College Savings Calculator

First the tool projects each year of college from today's price. With $Y$ years until college and costs rising by $g$ a year, the bill for college year $k$ (counting from 0) is:

You do not need the sum of the bills on the first day. Each bill is paid at the start of its school year, and the money for later years stays invested at return $r$. So the amount needed when college starts is each bill discounted back to that day:

Your savings grow monthly until then, with each month's deposit added. The share covered is what you will have, divided by what is needed. The monthly amount that covers it all is the deposit that makes the two equal, the same sum a spreadsheet FV function would give.

The taxable account comparison takes your tax rate off the return every year. At 15% tax on a 5% return, money grows at 4.25% instead, which would leave the Garcias below with $70,572 rather than $74,643 by age 18.

The Garcias save $300 a month

Their daughter is 5. They have $5,000 in a 529 and add $300 a month. College costs $25,000 a year today and rises 3% a year; they assume a 5% return. By 18 they will have $74,643, against $142,711 needed, so the plan covers 52%.

The first year will cost $36,713, and four years $153,595 in all. The money runs out in year 3. Saving $613.12 a month would cover every year. Open this example in the tool

Starting at birth and aiming for half

New parents with nothing saved want to cover half of the same college. With 18 years of growth, $239.59 a month does it, and $479.18 would cover all of it. The Garcias, starting at 5 with $5,000 saved, need $613.12 a month for the same college: 5 fewer years of growth cost them more each month. Their $200 a month would cover 42%. Open this example in the tool

The Lees catch up at 12

The Lees have $30,000 saved for a 12-year-old and can add $600 a month. They expect $30,000 a year today and use a cautious 4% return for the short time left. They reach $86,586, 61% of what is needed; covering all of it would take $1,274.28 a month. Open this example in the tool

The share covered tells you how much of the bill your plan meets on its own. Few families save the whole cost; grants, scholarships, income at the time and loans fill the rest. Check a college's net price calculator, which every US college that takes federal aid must offer, for a more realistic cost than the sticker price.

The return and the cost growth are guesses, and small changes add up over 18 years. Look at the return table. A 529's growth is free of federal tax when spent on qualified costs: tuition, fees, books, supplies and, for students enrolled at least half-time, room and board (IRS Publication 970).

For 2026, one person can give $19,000 to each child without filing a gift tax return, or $95,000 at once into a 529 by electing on a gift tax return to spread it over five years. A 529 can also pay up to $20,000 a year of K-12 tuition from 2026, and up to $35,000 of unused money can move to the student's Roth IRA once the account is more than 15 years old.

• Multiplying the first year by four. Costs keep rising during college, and money for later years keeps growing. The tool projects each year.
• Using today's price for a child who is years away. At 3% a year, a $25,000 cost becomes $36,713 in 13 years.
• Assuming a high return right up to college. Money needed within a few years is usually moved to safer investments, so test a lower return for the last years (SEC Investor.gov, An Introduction to 529 Plans).
• Ignoring plan fees. Enter a return after the plan's yearly fees, which are listed in its offering document.
• Skipping your own state's plan without checking. Many states give a state tax deduction or credit only for contributions to their own plan. Compare that with another plan's lower fees.
• Taking money out for other things. The earnings part of a non-qualified withdrawal pays income tax plus a 10% additional tax.