Inflation and tuition

[sarrudav]

I need to write a report on saving for college and I have the formula for savings and interest. What I am missing is the formula for projected tuition. Does anyone know what that is? Perhaps I am overthinking it. Is it just annual tuition times annual inflation to the power of years until attendance?? Please help me.

 

[wjm11]

formula for projected tuition

I recommend a little research. Tuition rates increase faster than the average inflation rate. Here are a few sites to get you started:

http://apps.collegeboard.com/fincalc/college_cost.jsp

http://www.hesc.com/content.nsf/SFC/9/C ... _Projector

http://ezinearticles.com/?What-is-the-C ... ?&id=59147

 

[sarrudav]

Sooo... Annual tuition times Twice annual inflation ^years until attendance??

 

[wjm11]

Annual tuition times Twice annual inflation ^years until attendance?

Basically, yes. To be complete, various scenarios should be presented: in state, out of state, private, etc. At the risk of stating what may be obvious to you, the inflation must be converted from percentage to a decimal and added to 1. Also recognize that these projections may be worthless if the inflation rate changes dramatically, which it very well may in the next ten years.

 

[sarrudav]

It seems like when real financial planners do this they start with "based on current inflation rates, even though they may change.." So that's what I'm going by. I don't want to make it too complicated. I was going to give an average private school number and an average public school number. Thank you for your help. It is making more sense to me now.