Paid off $65,000 in 14 months.
“I decided to get serious about paying off debt. No spouse, no kids, just a good time to hustle and lay a good financial foundation.”
See how much you need to save for college and build a plan to help your student graduate without student loans.
This calculator estimates your total college expenses and shows how much you’ll need to save each month to reach that goal by the time your student enrolls. Just enter your child’s age, school type, current college savings, any expected scholarships and your expected return rate.
Once you have your total and your monthly amount, use the slider to adjust the monthly savings amount to fit your budget. We’ll do the math to show you how much of a savings gap or how much extra savings you could have. Assumptions: [X]% average annual tuition inflation and [Y]% average annual investment return based on long-term historical trends.
How to Close Your Gap
Debt-Free Strategies
If the numbers show you’ll have a savings gap, don’t panic. These four strategies can make a big difference in how much you need to save each month to cover your total college expenses.
Do Community College for First 2 Years
Sending your student to community college for two years before transferring to a four-year university could save you thousands on tuition.
Biggest Impact
Choose In-State Over Private
Choosing an in-state public university instead of a private school is often one of the biggest ways to lower college costs—and it doesn’t require any extra sacrifice during school.
Scholarships Aren’t Only for Valedictorians
Did you know millions of dollars of scholarship money go unawarded every year? If your student works to earn $3,750 a year in scholarships, that’ll add up to $15,000 over four years.
Student Works Part Time During School
A student earning $5,000 a year could contribute $20,000 over four years toward tuition and expenses without taking on debt.
These strategies work even better together. A family that chooses an in-state school, brings in $15,000 in scholarships over four years, and has their student work part time could cut what they need to save each month by more than half—without student loans and without sacrificing retirement savings.
A SmartVestor Pro can help you create a plan that fits your family’s situation.
If You’re on Baby Step 4. . .
While Baby Steps 1–3 are done one at a time and in order, you’ll work on Baby Step 4 (invest 15% of your gross income into retirement) and Baby Step 5 (save for your children’s college fund) and Baby Step 6 (pay off your home early) all at the same time. Once you have your 15% rolling into retirement, use this calculator to find your monthly savings amount for Baby Step 5.
Is It Too Late for Parents of Teens?
No—but the game plan changes.
There’s less time to build up savings, so focus instead on lowering the total cost of college. Choosing an in-state public university can save more than $60,000 over four years. Starting at a community college and transferring later can save tens of thousands more.
And there’s scholarships. So much money goes unclaimed each year because students don’t apply for them.
At this stage, the goal isn’t necessarily to save enough to pay for every penny of college. It’s to put together a plan that helps your student earn a degree without student loans—and keeps you from sacrificing your financial security (including retirement) to make it happen. With the right strategy, you still have plenty of time to make a big impact.
A SmartVestor Pro can help you build a plan that doesn’t require raiding your retirement or your home equity.
Real People, Real Debt, Real Freedom
Paid off $83,000.
“I wasn’t stressed about student loans . . . I knew as long as I stuck to the budget, I was going to be okay.”
Paid off $82,000
“When I saw it went under 20 grand, I was like ‘Ooh, let’s go.’”
“I cried the first time we finished a month and actually had money left over. That had never happened before.”
“Now we talk more about our money, we make decisions together, and it’s not stressful anymore.”
How SmartVestor Pros Work
SmartVestor Pros are investment professionals who understand the Baby Steps and Ramsey’s personal finance principles. To become a SmartVestor Pro, they must meet experience requirements, follow Ramsey’s Code of Conduct, and work for an investment advisor or broker-dealer firm which isn’t affiliated with Ramsey Solutions.
Ramsey will connect you to a SmartVestor Pro for free. If you decide to hire a SmartVestor Pro, there’ll be some type of payment for their service, like with any other professional. Advisors pay Ramsey to participate in the SmartVestor program.
Learn more about how a SmartVestor Pro can support you.
529 vs. ESA
A 529 plan is the go-to college savings tool for most families. Your money grows tax-free, and you can use it tax-free for qualified education expenses at most colleges and universities.
A Coverdell ESA offers similar tax advantages, but contributions are limited to $2,000 per year.
Borrowed Future
Borrowed Future exposes the truth about student loans and shows why saving for college now can help your child avoid years of debt.
Frequently Asked Questions
-
How much should I put in my 529 each month?
-
The easiest way to find your monthly savings amount is to use the College Savings Calculator. Based on your child’s age, current savings, expected scholarships and college goal, it’ll show how much you need to save each month to stay on track.
As a general ballpark number, parents saving for a newborn’s in-state public university education may need to invest around $350–550 a month. But every family’s situation is different. Scholarships, community college and lower-cost schools can significantly reduce how much you’ll need to save.
-
How much should a 7-year-old have in a 529?
-
There’s no magic number, but a family saving for an in-state public university may want to have roughly $30,000 saved by age 7.
Don’t treat that range as a pass-or-fail test. Every family starts from a different place, and there are plenty of ways to lower college costs along the way. Use the College Savings Calculator to see where you stand, and build a plan based on your family’s goals. And if you need help building that plan, a SmartVestor Pro can help you find the best path forward.
-
Is it too late to save for college if my child is in high school?
-
No—but your strategy shifts.
If your child is already in high school, focus on the biggest ways to lower college costs: community college, scholarships and part-time work. Those three moves can save tens of thousands of dollars and reduce how much you’ll need to cover from savings.
Don’t stress about making up for lost time. The goal is to create a solid plan that helps your kid avoid student loans.
-
What assumptions does this calculator use?
-
The calculator estimates future college costs using a default tuition inflation rate and an expected investment return. You can change the latter number to fit your goals and timeline. These defaults are based on long-term historical averages.
-
Are 529 plans still a good idea?
-
Yes. For most families, a 529 plan remains one of the best ways to save for college because your investments grow tax-free, and qualified education withdrawals are tax-free too.
If you qualify, a Coverdell ESA may also be worth considering, but 529 plans are still the most common college savings option for many families.
-
How do I balance saving for college and retirement?
-
Follow the Baby Steps.
First, invest 15% of your household income for retirement in Baby Step 4. Then, start saving for your children’s college fund in Baby Step 5.
Protecting your retirement isn’t selfish. If you don’t save enough for retirement, your children may end up having to support you later. Your child can find ways to pay for college. You can’t borrow money for retirement.
-
Why use a SmartVestor Pro instead of managing this myself?
-
A SmartVestor Pro is an independent financial advisor who can help you build a personalized college savings plan and recommend strategies for your long-term goals. They focus on serving over selling and have the heart of a teacher.
SmartVestor Pros are not Ramsey employees, and they do not sell Ramsey products. Their role is to help you create a plan that fits your family’s goals and situation.
What to Do Next?
Get a step-by-step college savings plan using your income, timeline and Baby Step—to help you save for college without losing sight of your other money goals.