Calculating COA w/ savings question Forum

[thatgumyoulike]

Sorry if this has been answered--I couldn't find anything concrete on TLS. When calculating COA and subtracting savings money from expenses, do I plug the savings into the Georgetown calculator, then add it back to the total at the end?

Hypothetical example: Georgetown at sticker (since it is preloaded into the calculator), after interest, calculates to $284,057. If I apply $50,000 savings into first year tuition, it comes to $219,335 of debt (due to saved interest). Obviously I just spent $50k of my savings, so really it should be $269,335, right? Which number is more useful to post, debt at graduation, or total COA?

[thatgumyoulike]

People often say things like this: "The COA figures are correct and include scholarship, personal savings, family contributions." This suggests that COA is really total debt at graduation.

[boblawlob]

Figure out your budget for the school first. This means tuition, rent, books, food, transportation, and misc (take into account yearly increases like the usual 5.5% tuition increase and ~2% rent increase (may be diff for other areas)). Then subtract your savings from that number and then multiple what's left by 8% interest (just a good rough number).

edit: And yes, COA is total indebtedness at graduation because interest accruing while you study in law school should be factored into the cost.

[thatgumyoulike]

Figure out your budget for the school first. This means tuition, rent, books, food, transportation, and misc (take into account yearly increases like the usual 5.5% tuition increase and ~2% rent increase (may be diff for other areas)). Then subtract your savings from that number and then multiple what's left by 8% interest (just a good rough number).

edit: And yes, COA is total indebtedness at graduation because interest accruing while you study in law school should be factored into the cost.

Thanks boblawlob. I know where to find the COL figures, and I have the Georgetown calculator (which factors in interest), so that isn't really what I'm asking though. Simply, is COA as used on TLS the total cost of attendance (including interest), or is it total debt at graduation?

Extreme example: If someone had $250,000 savings they could apply to tuition and COL, thus avoiding loans, would the "COA" for a T14 at sticker be $0? Or would it be $250,000, since they had to spend their savings (but have 0 debt at graduation).

[Bronck]

Most people go by debt at graduation, but include a note about how much of their own savings they're using.

[BigZuck]

When people say COA around here they almost always mean debt load at graduation.

[dixiecupdrinking]

If you're using your savings, it's part of your cost. If you want advice about whether a particular course of action is smart, you should definitely include that fact because it's a relevant consideration.

It's stupid to equate "cost of attendance" and "debt at graduation." Two very different things with different implications.

[dawyzest1]

If you're using your savings, it's part of your cost. If you want advice about whether a particular course of action is smart, you should definitely include that fact because it's very relevant.

+1.

Your savings is still a cost and while there's no interest on that, there is the opportunity cost of spending it rather than letting interest accrue on it.

[thatgumyoulike]

If you're using your savings, it's part of your cost. If you want advice about whether a particular course of action is smart, you should definitely include that fact because it's a relevant consideration.

It's stupid to equate "cost of attendance" and "debt at graduation." Two very different things with different implications.

I agree. It just seems to be common here, with people not even mentioning how much savings they put in.

[JamMasterJ]

most people go by debt since they contribute little/nothing to the cost in the significant majority of cases.

[untar614]

i think that may confuse things though since generally calculting coa incorporates interest, but if you use savings, you wouldnt be paying interest on that portion. So I think giving your debt at graduation and stating what would be paid for out of savings separately would be the most useful. Like "I will graduate with $Xk in loan debt and will be paying $Yk from savings"

[dawyzest1]

i think that may confuse things though since generally calculting coa incorporates interest, but if you use savings, you wouldnt be paying interest on that portion. So I think giving your debt at graduation and stating what would be paid for out of savings separately would be the most useful. Like "I will graduate with $Xk in loan debt and will be paying $Yk from savings"

this sounds right to me. You're not disregarding savings cost entirely. Rather you're separating it out as it has different parameters.