How much should you save for college?

How the math works

Three steps:

1. Future tuition cost = current 4-year total × (1 + tuition inflation)^{years until enrollment}. Tuition inflation has run ~5% annually for decades, well above CPI.
2. Required monthly savings = future cost ÷ FV annuity factor at expected return rate. Default: 7% real return inside a 529 plan.
3. Tax-shelter benefit: 529 plans grow tax-free for qualified education expenses, plus state-level deduction (where applicable) on contributions. Effective return is 7% + state tax savings.

Today's reference points (2026 dollars):

• In-state public 4-year (tuition + room + board): ~$110K total
• Out-of-state public 4-year: ~$200K
• Private non-profit 4-year: ~$280K
• Elite private 4-year: ~$350K+

For a newborn (18 years to enrollment) at 5% tuition inflation: in-state public future cost = $265K. Required monthly savings at 7%: ~$430. Required monthly at 5% (more conservative): ~$610.

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Real-world scenarios

• Starting at birth: $430/month covers in-state public tuition (start at 8: $1,250) — the cost of waiting + the multi-child math + when partial-funding is the realistic plan.