Net Price Calculators as Financial Aid “Game-Changers”

A recent New York Times blog post discusses the potential strengths and weaknesses of net price calculators, which will appear on almost all college websites by October 29. Here’s our take:

Net price calculators can indeed be a “game changer” for prospective college students and their families. Armed with early, individualized, and comparable estimates of college costs (after subtracting grants and scholarships), students will be able to make more informed decisions about college at all stages of the process. Net price calculators can help students look past “sticker price” and discover that their dream school may be more (or less) affordable than they thought – before it is too late and most of their college decisions have already been made.

The blog post focuses a lot of attention on how accurately net price calculators can predict a student’s exact financial aid package, but we think that’s the wrong question. Net price calculators are intended to provide estimates that help students figure out which schools might be within reach, before they decide where to apply. At that early stage of the process, ease of use is more critical than precision.

We have been monitoring net price calculators over the past year and found, as noted in the blog post, that there is a great deal of variation in the way colleges have been designing and posting their calculators. To best serve the needs of prospective students and their families, net price calculators should all:

• Be easy to find – colleges should prominently post links to their calculators in areas of their websites that prospective students are likely to visit
• Be easy to use – limit the number of required questions, make it clear which questions are required, and keep the questions simple
• Present results that are easy to understand and compare – emphasize the “net price figure,” not what’s left after subtracting work-study and loans
• Protect students’ personal information – make it clear that submitting contact information is optional, protect users’ privacy, and inform them about how owns and has access to their information

For more information about net price calculators, and to find out more about our findings and recommendations, please view our report, “Adding It All Up: An Early Look at Net Price Calculators.”