Previous research on attrition has focused on the economic consequences of low graduation rates in terms of costs to students and families (from tuition and fees that do not culminate in a credential), lost time, and income and tax losses from low educational attainment in the workforce. However, no systematic attention has been given to another critical aspect of the cost of attrition, which is the cost to institutions (and to their financial supporters) from the "lost" credits that do not lead to degrees or certificates. Attrition clearly adds to the expense of producing college degrees, thus reducing it is crucial to enhancing productivity and increasing educational attainment. How big is this lost investment, and what do these "unfinished degrees" from student attrition look like? Just as completed degrees come in different shapes and sizes, unfinished degrees vary widely from student to student, although there has not been a common language to talk about them nor a method to analyze their costs. The development of a simple definition of attrition, as well as a methodology that can be used with existing data to assign costs to it, is the focus of this effort. Guided by advice from a group of postsecondary education policy and data experts, this work sets forth the following: (1) A clear definition of attrition that can be used by institutions and policymakers to develop benchmarks and measure performance; (2) A methodology for assigning institutional production costs to attrition, both for national data sets and for states that wish to pursue a similar analysis; (3) Identification of benchmarks that can serve as the basis for setting goals and measuring performance in reducing attrition; (4) Suggestions of ways to use data on attrition and its costs to inform state-and system-level policy choices and budgets, including performance funding; and (5) Dissemination of the project's findings to leaders and decision makers around the country. "Beginning Postsecondary/Integrated Postsecondary Education Data System Analysis: Definitions and Methodology" is appended. (Contains 7 tables, 2 figures, and 4 footnotes. A static illustration (a spreadsheet) accompanies this report.)