Rex says
Money math without the spreadsheet headache. Plug in your numbers and I'll show you exactly where the dollars land.
Try a scenario
Click to load — tweak from there.Inputs
Result
Extra cost of borrowing vs. saving
$26,442
Monthly savings needed
$244
Monthly loan payment if borrowed
$464
Total loan interest paid
$15,732
Total repaid on loan path
$55,732
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How to use this
- 1Enter college cost to cover ($).
- 2Enter years available to save before needed.
- 3Enter expected investment return while saving (%).
- 4Enter student loan interest rate (%).
- 5Enter loan repayment term (years).
- 6Read your extra cost of borrowing vs. saving on the right — it updates as you type.
- 7Hit Share to keep the scenario or send it to someone.
About this calculator
A dollar saved in advance and invested is worth more than a dollar borrowed later, because saved money grows tax-advantaged while borrowed money accrues interest working against you. This calculator compares two paths to the same college cost target: contributing monthly to a 529 that grows at an investment return, versus paying nothing now and instead taking federal/private loans at a given interest rate repaid over a standard term, showing the total dollars out of pocket for each path including investment gains foregone and loan interest paid.
Worked example
Using the values the calculator loads with:
Inputs
- College cost to cover: 40000 $
- Years available to save before needed: 10
- Expected investment return while saving: 6 %
- Student loan interest rate: 7 %
- Loan repayment term: 10 years
Results
- Extra cost of borrowing vs. saving: $26,442
- Monthly savings needed: $244
- Monthly loan payment if borrowed: $464
- Total loan interest paid: $15,732
- Total repaid on loan path: $55,732
What each field means
Inputs
- College cost to cover ($)
- The college cost to cover used in the calculation, measured in $. Starts at 40000 $ so you have a working example on load.
- Years available to save before needed
- The years available to save before needed used in the calculation. Starts at 10 so you have a working example on load. Accepted range: 1–18.
- Expected investment return while saving (%)
- The expected investment return while saving used in the calculation, measured in %. Starts at 6 % so you have a working example on load. Accepted range: 0–12 %.
- Student loan interest rate (%)
- The student loan interest rate used in the calculation, measured in %. Starts at 7 % so you have a working example on load. Accepted range: 0–15 %.
- Loan repayment term (years)
- The loan repayment term used in the calculation, measured in years. Starts at 10 years so you have a working example on load. Accepted range: 1–25 years.
Results
- Extra cost of borrowing vs. saving
- Returned as a money amount in US dollars and shown as the headline result. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
- Monthly savings needed
- Returned as a money amount in US dollars. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
- Monthly loan payment if borrowed
- Returned as a money amount in US dollars. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
- Total loan interest paid
- Returned as a money amount in US dollars. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
- Total repaid on loan path
- Returned as a money amount in US dollars. It recalculates instantly whenever you change an input, so you can compare scenarios without reloading.
FAQ
Why is saving in advance so much cheaper than borrowing?
Because a 529 lets compound growth do part of the work for you, while a loan makes compound interest work against you on the same dollar amount. Even at similar rates (6% growth vs. 7% loan interest), the saving path wins because you're contributing over more years than you're typically repaying, and the invested contributions grow tax-free.
Doesn't this ignore financial aid and scholarships?
Yes, intentionally — this isolates the pure cost-of-capital comparison for whatever amount you actually need to fund out of pocket after aid. Run your net cost (sticker price minus expected grants and scholarships) through this calculator, not the full sticker price.
What if I can't save the full amount in time?
A blended approach is common and often optimal: save what you reasonably can, then borrow only the remaining gap. This calculator can be run twice — once for the portion you'll save, once for the portion you'll borrow — and the results added together.
Are federal loans and private loans treated the same here?
The math is the same, but federal loans (Direct Subsidized/Unsubsidized, PLUS) offer protections private loans don't — income-driven repayment, deferment, and forgiveness programs. Rate alone doesn't capture that flexibility value, so don't choose purely on the interest rate number.
Accuracy and limitations
- Results are estimates before tax, fees, and inflation unless an input explicitly covers them.
- Rates are treated as fixed for the whole period — variable-rate products will drift from this projection.
- This is educational maths, not financial advice. Check anything contractual with the lender or your accountant.
Related tools
Cite this calculator
Writing about this topic? Grab a citation — every link helps keep these tools free.
RevenueLab. (2026). College Savings vs. Loans Calculator. Retrieved from https://www.revenuelab.fyi/toolbox/college-savings-vs-loans
<p>Source: <a href="https://www.revenuelab.fyi/toolbox/college-savings-vs-loans" target="_blank" rel="noopener">College Savings vs. Loans Calculator — RevenueLab</a> (2026).</p>
Source: [College Savings vs. Loans Calculator — RevenueLab](https://www.revenuelab.fyi/toolbox/college-savings-vs-loans) (2026).