Unexpectedly Intriguing!
January 27, 2009

Cap and Diploma Imagine that you are the proud parent of a child who will soon graduate from high school and will be bound for college. As their parent, you've been there for every phase of their life, from birth, through their toddler years, through their childhood and into this point of their teens. What's more, you've fed them, clothed them and housed them all their lives, working and sacrificing to make sure that they could reach this point where they'll make the full transition to adulthood.

In return, they've given you aggravation beyond end and greater joy than you could ever have imagined. In choosing their university, they've finally recognized your good parenting and that you're not, in fact, made of money, so they've opted for a good school near where you live, which means that they'll be able to continue living at home while getting their higher education. But now, you're faced with two crucial questions:

How much will you charge them for rent? And how much will you make them pay to eat meals at your house?

At least, those are the kind of questions that the financial aid literature from one particular state university, which will remain anonymous, would seem to believe that parents whose children live at home while attending college full-time think about. Seriously.

Better still, you don't need to take our word for it. We've excerpted the school's annual college cost information from its financial aid literature so you can see the side-by-side comparison of the costs they assign to students living at home, on campus and off-campus, which we provide below for both qualified state residents:

Expense Undergraduate
Living with Parent
Living on Campus
Living Off Campus
Books/Supplies 1,130 1,130 1,130
Room 1,350 5,240 4,710
Board 1,160 3,550 2,880
Transportation 1,650 1,440 1,650
Personal 2,110 1,750 1,870
Fees* 252 252 252
Resident Tuition* 5,410 5,410 5,410
Resident Total* 13,062 18,772 17,902

* Totals above reflect estimated numbers for full-time students starting Fall 2008. Tuition and fees vary based on new or continuing student status and by program, campus or residence hall.

Obviously, the costs of books and supplies, tuition and fees should be the same for each of these hypothetical students across the board. That makes sense. We can even understand some of the higher expenses of living at home. Living away from campus, for example, we would anticipate that transportation costs would indeed be higher.

But then there's the parts we don't understand. Let's do some math here, shall we? At $1,350 per year and 12 months per year, that's roughly $112.50 per month the university's financial aid people seem to think we should be charging our child to live at home. Likewise, our hypothetical child's monthly grocery bill works out to be $96.67. And why exactly would our living-at-home child's personal annual expenses be $360 more than a student's cost of living on campus?

Now, let's compare those costs to the monthly cost of living on campus. Here, room works out to be $544.72 per month for the nine months college is in session, which assumes that we're still charging our collegiate pride and joy that $112.50 per month for the three months that they come home for the summer. Doing similar math for board expenses, and we see that the university food plan runs $336.22 per month.

But look at those bottom lines - they're not that much different from one another at just around $5,000 to $6,000 more per year than the cost of living on campus! Just think about how much financial aid we could get to pay all those expenses - especially if we boot the kid from the house and make them live on campus!

That's the college's math. For the math that parents with a clue would do, continue reading....

In this situation, where your child has been living with you for all their lives, the only thing you need to be concerned with is the change in your costs from where they are today. You're already housing your child. You're already feeding and clothing them. The real comparison is between how your costs of supporting them today are compared to the alternatives of living on campus or off-campus (but not with you.)

We redid the table from above to take these considerations into account, and what the heck, we'll give the college those higher personal costs for living at home. Here's our better estimate of the bottom line:

More Realistic Higher Education Costs
Expense Undergraduate
Living with Parent
Living on Campus
Living Off Campus
Books/Supplies 1,130 1,130 1,130
Room 0 5,240 4,710
Board 0 3,550 2,880
Transportation 1,650 1,440 1,650
Personal 2,110 1,750 1,870
Fees* 252 252 252
Resident Tuition* 5,410 5,410 5,410
Resident Total* 10,552 18,772 17,902

Pretty amazing, right? That's means that living at home cuts your annual college cost by $8,220. Over four years, that's $32,880 less than the cost of living on campus and should your child end up on the five-year plan, that's $41,000 that your child won't have to take out loans to pay that amount and fifteen years worth of interest back upon.

Gosh, if that math is right, we guess the school's financial aid people won't be making as much money as they thought they would from you and your child. But at least we can see now why they'd rather every parent charge their school-going children room and board.


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