Financing College Costs

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The table below shows the projected cost of a typical public and private four-year college education, along with the amount you need to invest in zero coupon bonds today (at slightly more than 12%) to earn what you will need later. The projected college costs assume that college expenses increase 6% annually -- slightly higher than the rate of inflation over the past several

Projected cost Investment

(4 years) * required

PUBLIC COLLEGES

In 5 years $28,800 $15,700

In 10 years 38,500 10,970

In 15 years 51,600 8,250

In 18 years 61,400 6,860

PRIVATE COLLEGES

In 5 years 56,000 30,400

In 10 years 75,000 21,600

In 15 years 100,400 15,850

In 18 years 119,500 13,400

* All figures rounded.

Source: T. Rowe Price Associates Inc.