A great new tool for comparing college costs
(MoneyWatch) Finding out the cost of any college in America is, thanks to a new startup, a whole lot easier.
If you've ever used Kayak, Carmax or Zillow to shop for airfares, cars or houses, you'll appreciate what is about to happen to the way that Americans will soon compare college prices. A company called College Abacus, which was created by a pair of Rhodes Scholars, has created a potentially valuable -- and free -- tool that allows you to check the net price of a school as easily as you now look up the cheapest air fares to Hawaii. The net price is what you get after a school's grants and scholarships are factored in.
One-stop college price shopping
To use the comparison tool, a family must answer one set of questions, which are used to come up with net price comparisons of all the colleges on a teenager's list. The individualized estimates that you obtain at College Abacus should match the price verdicts that you would receive if you spent time using the net price calculator at every institution's website.
College Abacus is now generating financial aid estimates for more than 2,500 public and private universities, says Abigail Seldin, who founded the startup with her husband Whitney Haring-Smith. The company plans to add many more private and state colleges and universities to its lineup in the months to come.
College Abacus is able to provide this service because of the existence of net price calculators. These online tools, which nearly every school in the country is now required to post on its website, allows a family to provide basic financial information about their household income and a child's academic profile in order to calculate an estimate of what the net price of a particular institution.
So far, College Abacus can offer the aid estimates for schools that used a federal template to build their net price calculators. Calculators relying on the federal template ask users a minimal number of questions, which has led to criticism that these calculators generate poor cost estimates. I suspect that some private schools, in particular, are using these simplified calculators in an attempt to mask how stingy their aid offers can be. Instead, schools could tell applicants that the calculators aren't reliable and that they should apply to their institutions anyway.
College Abacus next month will begin including private universities in its database that rely on more sophisticated institutional calculators. Adding these schools is more laborious because College Abacus must essentially crack the code for each of these calculators to provide reliable estimates. These will include schools that use net price calculators designed by Student Aid Services, and eventually the College Board. Other schools that will be added to the lineup in November will be the University of California campuses, as well as the State University of New York and City University of New York campuses.
College Abacus is a major advance in comparing college costs. Don't pass up the opportunity to use it.
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