This is what the calculation gives for the numbers you entered. It is an estimate, not advice, and it knows nothing about your situation beyond those numbers. Rules for United States change on a published schedule; the effective date is shown on every rule-based tool.
How this is calculated
The balance grows with contributions while costs inflate. The part usually done wrong is the cost side: a four year degree starting in fourteen years does not cost four times the year-fourteen figure, because each subsequent year inflates again. Both effects compound, and education inflation running above general inflation means the gap widens the longer you wait to start.
Worked examples
Each of these is asserted on every build. If a change to the engine ever moved one of these answers, the build would fail before the page could print it.
fourteen years of saving
- Current balance
- $12,000.00
- Monthly contribution
- $500.00
- Years until college
- 14
- Annual return
- 6.5%
- Current annual college cost
- $32,000.00
- Education cost inflation
- 5%
- Years of college
- 4
Projected balance$166,190.68
32,000 x 1.05^14
Open this exampleno inflation keeps the cost flat
- Current balance
- $12,000.00
- Monthly contribution
- $500.00
- Years until college
- 14
- Annual return
- 6.5%
- Current annual college cost
- $32,000.00
- Education cost inflation
- 0%
- Years of college
- 4
Projected balance$166,190.68
boundary
Open this exampleMethod and limits
What it assumes
- Constant return and constant education inflation, neither of which holds.
What it deliberately does not model
- Financial aid, scholarships and in-state pricing all change the cost side substantially.
- 529 withdrawals must be for qualified education expenses to stay untaxed.
- State tax treatment of contributions varies considerably.
Formula version 1.0.0 · definition 1.0.0 · United States · Report a problem with this calculator
Frequently asked questions
- Why is the projected cost so much higher than today?
- Because education inflation compounds through the saving years and again through the college years. At five percent, a cost doubles roughly every fourteen years.