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College Data 2020-2022

Dear Clients & Friends,

This week, we are discussing college cost data for the 2020-2021 school year, as well as 2020 FAFSA data. Given the number of our clients who support their children and grandchildren’s education, we know that this data will be helpful to many.

Every year, the College Board releases updated college cost figures and trends in its annual report. Although costs can vary significantly (depending on the region of the country and the specific college), the College Board publishes average cost figures, which are based on a survey of approximately 4,000 colleges across the country.

Below are some cost highlights for the 2020-2021 academic year.1 Because many residential colleges shifted to an online model this year, the College Board estimated 2020-2021 room and board figures to be the same as 2019-2020, adjusted for a 1% inflation rate.

"Total cost of attendance" includes direct costs for tuition, fees, room, and board, plus a sum for indirect costs that includes books, transportation, and personal expenses (which will vary by student).

Public college costs (in-state students)

  • Tuition and fees increased 1.1% to $10,560

  • Room and board increased 1% to $11,620

  • Total cost of attendance: $26,820

Public college costs (out-of-state students)

  • Tuition and fees increased 0.9% to $27,020

  • Room and board increased 1% to $11,620 (same as in-state)

  • Total cost of attendance: $43,280

Private college costs

  • Tuition and fees increased 2.1% to $37,650

  • Room and board increased 1% to $13,120

  • Total cost of attendance: $54,880

Over the past decade, the average published cost for tuition, fees, room, and board at private 4-year colleges increased by 17% beyond increases in the Consumer Price Index; the average published cost for tuition, fees, room and board at 4-year public colleges increased 15% beyond increases in the Consumer Price Index.2

FAFSA opened October 1st

The FAFSA for the next school year, 2021-2022, opened on October 1, 2020. The 2021-2022 FAFSA relies on income information from your 2019 federal income tax return and current asset information. Your income is the biggest factor in determining financial aid eligibility.

A detailed analysis of the federal aid formula is beyond the scope of this article, but generally speaking, here's how your expected family contribution (EFC) is calculated:3

  • Parent income is counted up to 47% (income equals adjusted gross income, plus untaxed income/benefits, minus certain deductions)

  • Student income is counted at 50% over the student's income protection allowance ($6,970 for the 2021-2022 year)

  • Parent assets over the asset protection allowance are counted at 5.64% (home equity, retirement accounts, cash value life insurance, and annuities are not counted at all)

  • Student assets are counted at 20%.

  • Your EFC remains constant, no matter which college your child attends. Your EFC is not the same as your child's financial need. To calculate financial need, subtract your EFC from the cost of a specific college. Because costs vary by college, your child's financial need will vary by college.

Just because your child has financial need doesn't mean that colleges will automatically meet 100% of that need. Colleges that do meet 100% of "demonstrated need" usually advertise this; not all colleges do. If a college doesn't meet 100% of your child's financial need, you'll have to make up the gap, in addition to paying your EFC.

To get an estimate for out-of-pocket costs at a particular school ahead of time, run a college's net price calculator, which is available on every college website. You input income, asset, and general family information, and the net price calculator provides an estimate of the grant aid your child might expect at that particular college. The cost of the college minus this grant aid equals your net price, hence the name "net price calculator."

Reduced asset protection allowance

Over the past two decades, a change in the FAFSA has been negatively impacting a family's eligibility for financial aid. The asset protection allowance, which allows parents to shield a

certain amount of assets from consideration (in addition to the shielded assets listed above), has been steadily declining for years, resulting in higher EFCs. Ten years ago, the asset protection allowance for a 48-year-old married parent with a child about to enter college was $46,200. For 2021-2022, that same allowance is $6,600, resulting in a $2,233 decrease in a student's aid eligibility ($46,200 - $6,600 x 5.64%).4

Student loan debt

Student loan debt is the second-largest consumer debt category, coming in after mortgage debt and ahead of both auto loans and credit card debt.5 More than six in ten (62%) college seniors who graduated in 2019 had student loan debt, owing an average of $28,950.6 Paying careful attention to costs when the time comes to attend college might help you and/or your child avoid excessive student loan debt.

We hope this information is helpful.

For those who may come across mask-wearing naysayers during this week’s holiday, we thought we’d provide an easy-to-understand graphic that you can share with those who are challenged in the realm of common sense.

We wish you all a wonderful and safe Thanksgiving holiday.

-Your family at MORWM

1-2) College Board, 2020

3-4) U.S. Department of Education, The EFC Formula, 2021-2022, 2011-2012

5) Federal Reserve Bank of New York, Quarterly Report on Household Debt and Credit, August 2020

6) Institute for College Access & Success, Student Debt and the Class of 2019, October 2020


Matthew Ramer, AIF®

Principal, Financial Advisor

MOR Wealth Management, LLC

1801 Market Street, Suite 2435

Philadelphia, PA 19103

P: 267.930-8301 | c: 215-694-4784 | f: 267.284.4847 |

601 21st Street, Suite 300

Vero Beach, FL 32960

P: 772-453-2810 |

The majority of this content was written and distributed MOR Wealth Management, all rights reserved. Securities and advisory services offered through Commonwealth Financial Network, Member FINRA/SIPC, a registered investment adviser. Fixed insurance products and services offered through CES Insurance Agency.


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