If you’re a parent with young kids like me, college cost projections for 2040 are top of mind—potentially reaching over $400,000 for a four-year degree. Even as the job market evolves, higher education remains key to their future success, no matter the career path. Setting them up to succeed in the future starts with a plan today to help them reach their goals—but how much will college really cost when your kids enroll in 10-15 years, and what’s the best way to save now?
Current Cost of Attendance
As our base case, I will be using data publicly available from my alma mater The University of Alabama. The costs reflect the total expenses for a full-time undergraduate student separated by in-state/out-of-state residency for the 2025-2026 academic year.
| Expense | In-State | Out-of-State |
| Tuition | $11,684 | $34,542 |
| Fees Estimate | $800 | $800 |
| Housing | $9,800 | $9,800 |
| Food | $5,316 | $5,316 |
| Books | $700 | $700 |
| Transportation | $2,266 | $3,330 |
| Miscellaneous | $3,962 | $3,962 |
| Loan Fee Estimate | $80 | $80 |
| Total Cost | $34,608 | $58,530 |
Inflation, demand, and the availability of student loans have certainly increased the cost of attendance since I was a student there. Our estimate of costs in 2040 definitely need to take into account this trend of rising prices. But how can we quantify that?
Rising Cost of Attendance
I was able to track down some historical data going back to 2010 when I was planning for my own family. There are some gaps in the years but I will show you how we can handle those using compound annual growth rates (CAGR) to help with our estimate.
CAGR measures the average annual return over a given time period. It smooths out returns to illustrate a theoretical steady growth rate and is a useful tool we can use with this data to help come up with some estimates. You can calculate CAGR using the formula below:
| Year | Total Cost | CAGR |
| 2010 | $21,900 | |
| 2015 | $25,950 | 3.45% |
| 2020 | $27,780 | 1.37% |
| 2021 | $28,620 | 3.02% |
| 2022 | $32,054 | 12.00% |
| 2023 | $33,382 | 4.14% |
| 2024 | $33,500 | 0.35% |
| 2025 | $34,608 | 3.31% |
2022 is a bit of an outlier compared to the other observations. If you remember during late 2021-2022 inflation spiked to nearly 9% as measured by the CPI (Consumer Price Index) before the Federal Reserve began hiking rates to combat inflation. We can use the average of all the years to get a high growth rate estimate including the 2022 outlier and low estimate using all years except 2022.
High Estimate (All Years Average) = 3.95%
Low Estimate (All Years ex 2022 Avg) = 2.61%
Average Estimate ((High + Low) / 2) = 3.28%
Projecting Cost of Attendance
We can use the low, high, and average estimated growth rates to calculate a range of projected costs for each year out to 2043. We start by taking our known costs for year 2025 and simply multiply that by 1 + Growth Rate Estimate % to get next years cost. Rinse and repeat for each year and each rate (High, Low, Average) and you will end up with the following estimates:
| Year | Low | High | Average |
| 2025 | $34,608 | $34,608 | $34,608 |
| 2026 | $35,511 | $35,975 | $35,743 |
| 2027 | $36,437 | $37,396 | $36,917 |
| 2028 | $37,388 | $38,873 | $38,130 |
| 2029 | $38,363 | $40,409 | $39,386 |
| 2030 | $39,364 | $42,005 | $40,684 |
| 2031 | $40,391 | $43,664 | $42,027 |
| 2032 | $41,444 | $45,389 | $43,417 |
| 2033 | $42,525 | $47,182 | $44,854 |
| 2034 | $43,635 | $49,046 | $46,340 |
| 2035 | $44,773 | $50,983 | $47,878 |
| 2036 | $45,941 | $52,997 | $49,469 |
| 2037 | $47,139 | $55,090 | $51,115 |
| 2038 | $48,369 | $57,266 | $52,818 |
| 2039 | $49,631 | $59,528 | $54,580 |
| 2040 | $50,926 | $61,880 | $56,403 |
| 2041 | $52,254 | $64,324 | $58,289 |
| 2042 | $53,617 | $66,865 | $60,241 |
| 2043 | $55,016 | $69,506 | $62,261 |
Total Cost of Attendance in 2040
Assuming you have a child that starts in-state college in 2040 and graduates in 4 years, our low estimate comes in at $211,813, high estimate at $262,575, and average estimate at $237,194. That is some serious sticker shock considering the current average estimated 4-year total cost is $145,630!
You can similarly calculate the out-of-state costs by year but I will just provide the 2040 ranges to save space: low estimate – $358,223, high estimate – $444,073, average estimate – $401,148.
Planning for Cost of Attendance
Higher education costs are soaring, and projections show college tuition could hit over $400K by 2040—making early planning essential for parents. Start college savings plans today—like 529 plans or UTMA/UGMA accounts—to help your kids graduate debt-free and achieve financial goals. With consistent forward-thinking, you can make higher education affordable despite rising costs.
In future posts, explore top college savings strategies and tools to minimize student loan burdens.