Transparent method
The formula
Worked example
Example inputs
How to interpret the result
A savings goal works backward from a target to a monthly deposit. Aiming for $120,000 in 14 years with $8,000 already saved and a 6 percent return needs about $387 a month, with about $65,013 of the total coming from new deposits and the rest from growth on what you have. Each extra year of time cuts the monthly figure a lot, which is why starting early matters more than choosing a slightly better investment.
Before you rely on it
What to check
Base the goal on the net price of the schools you are considering, after aid, not the sticker price. Net price is what a family actually pays.
The common error
Where people go wrong with college savings goal calculator
Setting a goal from today's tuition. Costs rise faster than general prices, so a goal in today's dollars will fall short by the time the bills arrive.
Sensitivity evidence
How expected annual return changes the required monthly saving
| Expected annual return | Required monthly saving | Future contributions |
|---|---|---|
| 4.0% | $472 | $79,254 |
| 5.0% | $428 | $71,960 |
| 6.0%worked example | $387 | $65,013 |
| 7.0% | $348 | $58,405 |
| 8.0% | $310 | $52,126 |
Every input, tested
Which input moves the required monthly saving most
| Input | Tested from | To | Required monthly saving at each end | Swing |
|---|---|---|---|---|
| Years to goal | 10.0 years | 18.0 years | $643 to $249 | $394 (102%) |
| Future savings goal | $108,000 | $132,000 | $341 to $433 | $91 (24%) |
| Expected annual return | 5.0% | 7.0% | $428 to $348 | $81 (21%) |
| Current savings | $7,200 | $8,800 | $394 to $380 | $14 (3.6%) |
Two variables at once
Required monthly saving by expected annual return and future savings goal
| Expected annual return \ Future savings goal | $96,000 | $120,000 | $144,000 |
|---|---|---|---|
| 4.0% | $365 | $472 | $579 |
| 5.0% | $329 | $428 | $527 |
| 6.0% | $295 | $387 | $478 |
| 7.0% | $263 | $348 | $432 |
| 8.0% | $232 | $310 | $388 |
Step by step
The worked example, input by input
| Input | Value used |
|---|---|
| Future savings goal | $120,000 |
| Current savings | $8,000 |
| Expected annual return | 6.0% |
| Years to goal | 14.0 years |
| Required monthly saving | $387 |
| Future contributions | $65,013 |
Where the inputs come from
Future savings goal is the amount you want by enrollment, in future dollars, so use the college cost calculator to inflate today's price. Current savings is what you have set aside for it. Expected annual return should match the account and the time left; a lower return is safer for a short horizon. Years to goal is the time until the first bill. Consider a partial goal, such as half the cost, if you expect scholarships and current income to cover the rest.
When the result stops applying
The projection uses a constant return and fixed contributions. College costs rise faster than general inflation, and the actual price depends on the school. Financial aid formulas treat parent-owned 529 accounts as a modest asset. Investment risk rises in the years before college, so many families shift to safer holdings as the date approaches.
What to compare it with
Project the current plan with the 529 growth calculator, and estimate the target with the college cost page. The scholarship impact calculator shows how aid changes the borrowing need, and the student loan pages cover borrowing. The savings goal and time to save calculators handle other targets.
People also ask
Frequently asked questions
How much should I save for college?
There is no single figure. Many families aim to cover a portion of the cost, since aid, scholarships, current income and student contributions also pay for it.
When should I start saving?
As early as possible, since time lets the money grow and reduces the monthly amount. Even small deposits from birth add up.
Does saving hurt my chance of financial aid?
Only slightly. Parent assets are assessed at a low rate in the federal formula, so saving usually helps more than it hurts.