What are Advanced Placement (AP) courses worth to your student?

Daniel V. Estenson CFP®, AIF®, Wealth Manager | Posted: January 29, 2020

One of my areas of interest in my position as a Wealth Manager with Bernicke Wealth Management, Ltd. is developing strategies for our client’s children and grandchildren to help pay for their college education. College costs have been increasing rapidly for quite a while now, and the amount of student loan debt is increasing each year as well. According to Nitro College, as of 2020 there is $1.53 trillion dollars of U.S. student loan debt, with the average student loan debt balance being $37,172. This is quite a burden for a young person to take on, especially in their early years of employment when they typically will be earning lower starting salaries as they enter the workforce.

There are a few ways parents or grandparents can help students reduce student loans for future college students. Saving funds for college in a 529 college savings account is one popular strategy. Another strategy is parents or grandparents paying for college tuition to the school directly with non-529 account money. Paying the school directly is typically not considered a gift to the student for gift tax purposes. Students can also apply for scholarships or grants for college or work to earn money to pay for a portion of their college costs. There is another way that the student can help themselves minimize college costs: by earning college credits through Advanced Placement (AP) classes.

What are Advanced Placement (AP) classes?

Advanced Placement, or AP, classes are taken by students while they are in high school. AP courses are typically college-level courses offered to high school students. In order to qualify for college credits, the student has to take the AP Exam. If their exam score is 3 or better on a 1 to 5 scale, they can be awarded college credit. In addition, taking and passing AP courses in high school can help students distinguish themselves when applying to college.

How much money can AP classes save a student?

Let’s take a look at a hypothetical example and imagine that a high-performing high school student, Jane, takes four AP courses and passes all four exams. The cost for an Advanced Placement exam in 2020 is $94 per exam. The cost of taking four AP exams would thus be $376.

Before we calculate how many credits the student could earn after passing each exam, let's look at how exam scores and credits work.

Each class has a different range of college credits available, and different high schools may have different Advanced Placement classes available as well. I used the University of Wisconsin- Eau Claire as the post-secondary school to calculate how many college credits could be earned from four Advanced Placement classes. Some AP courses offer additional credits for scores greater than 3. For example, a score of 3 on the AP Spanish exam will earn a student 8 college credits for foreign language and a 5 on the exam could earn a total of 16 credits.  The minimum and maximum credits available at UW-Eau Claire for the four AP courses I looked at are listed below:

AP Course

AP Exam Minimum Score

Minimum Number of Credits Earned

Maximum Credits Available per Course

AP English
(depending on course)




AP History
(depending on course)




AP Psychology




AP Spanish
(depending on course)




*Please note, other post-secondary schools may have different credit policies for Advanced Placement classes. Check with the Admissions department for the school your student is interested in attending to see how many credits may be earned through Advanced Placement exams.

Back to Jane…It is possible that she could have enough credits earned to have sophomore status the first day she steps on campus! If she is able to score a 5 on the AP Spanish exam, she would have a full semester of college credits for the cost of her one AP exam: $94!

How much are AP exams really worth?

Tuition/credit costs aren't the only expenses for a student during a semester at college. Students still may have other academic fees, housing costs, or a meal plan on campus. Let's look at how the costs compare when we take all of that into consideration:

Let's assume that 17 credits is approximately one full-time semester of college; 30 credits is approximately two full-time semesters of college. For the 2020-21 school year at UW-Eau Claire, Wisconsin resident undergraduate tuition/fees for a full time student is $8,870 per year, a dorm room on campus is $4,990 per year, and the average meal plan is $3,040. That is a total of $8,450 per semester, or $16,900 for one year of college.

The investment of $376 for AP Exams could potentially yield a return between $8,450 and $16,900 in college cost savings for Jane if she attends UW-Eau Claire, because those extra credits earned in high school mean one-two fewer semesters living on campus and attending college. She may also enter the workforce six months to a year earlier, allowing her to start earning income earlier than she would have had she not received credits for those AP courses.

Cost Savings Outweigh Extra Part-Time Job Hours, too

Finally, we compared the amount of savings of taking four AP exams this year to working an additional 3 hours per week during the student’s senior year of high school.

Let's assume that Jane can earn $10/hour at her part-time job. If she works an additional 3 hours per week for the entire year, she could earn an additional $1,560 before taxes. That isn’t a terrible strategy for saving for college costs, but isn’t nearly as impressive as not having to spend up to $16,900 for college! Students may be pleasantly surprised by how much money they could save by passing AP exams in high school compared to what they can earn while working an extra shift a week during their entire senior year.

About the author

Daniel V. Estenson CFP®, AIF®, Wealth Manager

Dan is a Wealth Manager who aims to help clients reach their lifelong goals through retirement income planning, tax minimization strategies, and wealth planning. Dan also helps develop college education funding strategies for our clients, in an effort to reduce the increasing costs of post-secondary education. He lives in Chippewa Falls with his wife, Nicole, and three children. In his free time, Dan enjoys traveling, the outdoors, and spending time with his family.

Certifications, Licenses, and Registrations

  • Registered Representative with LPL Financial, Member FINRA/SIPC
  • Accident, Life, Health, and Variable Life/Variable Annuity Insurance Licenses
  • Accredited Investment Fiduciary®

Education and Training

  • Series 7, 66 held at LPL Financial
  • Bachelor's Degree - Accounting; University of Wisconsin - Eau Claire
  • College for Financial Planning graduate

Send this blog post to someone: