How Much Should You Save for College Each Month?
Estimate future college costs with tuition inflation, how much you'll need when college starts, and the monthly savings to get there, with a free calculator.
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Free tool: College Savings CalculatorCollege costs keep rising, and the years before your child starts go quickly. The good news is that time is also your biggest advantage: money saved early has years to grow. This guide shows how to estimate the cost and the monthly savings needed, using the free College Savings Calculator.
Step 1: estimate the future cost
Start from today's cost of one year, including tuition, fees, housing and food, and grow it by a college cost inflation rate.
Example: a child who is 5 today and starts college at 18, for 4 years, at $30,000 a year today, rising 4% a year:
| College year | Child's age | Cost |
|---|---|---|
| 1 | 18 | $49,952 |
| 2 | 19 | $51,950 |
| 3 | 20 | $54,028 |
| 4 | 21 | $56,189 |
Total: about $212,120 in future dollars.
Step 2: what you need when college starts
You don't need the whole amount on day one, because the money keeps earning while it's spent. At a 6% return, you need about $194,225 when college starts to cover all four years.
Step 3: the monthly savings
With $10,000 already saved, growing to about $21,329 by age 18, the gap is about $172,895. Covering it takes about $743 a month for the next 13 years.
Starting earlier makes a big difference:
- From birth: about $545 a month
- From age 5: about $743 a month
- From age 10: about $1,178 a month
You don't have to cover everything
Scholarships, grants, work, current income and student loans can all play a part. Aiming to cover 50% of the costs in the example takes about $326 a month. Many families pick a share they're comfortable with and adjust as the child gets older.
Where to save
- 529 plans: earnings grow tax-free and withdrawals are tax-free for qualified education expenses; many states also give a tax deduction for contributions.
- Coverdell ESAs and custodial accounts are other options, with different rules.
- Don't sacrifice retirement savings for college: there are loans for college, but not for retirement.
For other savings goals, see How Much to Save Each Month for a Goal.
How to use the College Savings Calculator
- Open the College Savings Calculator.
- Enter your child's age, the age college starts and the number of years.
- Enter today's cost per year and the college cost inflation rate.
- Enter what you've saved, the expected return and the share of costs to cover.
- Read the results: the monthly savings needed, the total cost of college, the amount needed when college starts, what your current savings will grow to and the gap to fill, with charts of your savings path and each year's cost, plus a table of projected costs.
Frequently asked questions
How much should I save for college per month?
It depends on the cost, your child's age and your return. For a 5-year-old and a $30,000-a-year college today, about $743 a month covers four years at 4% cost inflation and a 6% return.
How much will college cost in the future?
At 4% inflation, $30,000 a year today becomes about $50,000 a year in 13 years, so four years would cost about $212,000.
Should I save in a 529 plan?
For most families it's a good fit: tax-free growth and tax-free withdrawals for qualified education costs, often with a state tax break.