Debt from college tuition has skyrocketed over the last several years. Parents and students are weighing their ROI (return on investment) before making their college choices. As college costs have shot up, so has student debt. How can you pay for college without incurring debt?
According to the latest Quarterly Report on Household Debt and Credit, outstanding student loan debt stood at $1.58 trillion in the fourth quarter of 2021, an $8 billion decline from the third quarter. About 5 percent of aggregate student debt was 90+ days delinquent or in default in the fourth quarter; the lower level of student debt delinquency reflects a Department of Education decision to report current status on loans eligible for CARES Act forbearances.
That’s the bad news. But if you’re a savvy consumer and research the costs before signing on the dotted line, you should be able to go to college without incurring debt. Zac Bissonnette, author of DebtFree U, is proof that it can be done. He graduated from college with zero debt.
Believe it or not, you may be able to graduate without debt if you use these 10 ways to pay for college:
1. Take AP and Dual Credit Courses
Charging by credit hour adds up; but there are two ways you can save money on those costs: AP classes and dual credit courses. If you enroll in AP classes during high school and take the AP tests after completion, many colleges will award you credit for those courses. You can enter college as a sophomore and graduate sooner. AP tests cost $89.
Additionally, many high schools offer dual credit courses at a discounted rate, usually at local community colleges. Students take college courses simultaneously while attending high school. With the completion of these courses, the student receive college credit as well. It doesn’t take a math whiz to figure out that this is a huge savings.
2. Ignore the high priced colleges
There are hundreds of moderately priced colleges and universities in this country and abroad. Before you start choosing a college, investigate their tuition fees and financial aid history. College Navigator and the College Scorecard are the best places to start. If the colleges give little or no merit aid or scholarships and have a high price tag, cross them off the list. Look at smaller private colleges who have alumnus that give endowments and dispense merit scholarships.
Community colleges are also a practical way to save money. Their credit hours are substantially less than 4-year institutions. With this option, you save money on housing as well, since most community colleges are located close to home. After two years at a community college, you can transfer to a 4-year university. Just verify the credit hours you are taking will transfer.
3. Go to work
Working during school will give you an opportunity to add to your college fund or pay for college as you attend. Work part-time in high school and college, especially during summers and breaks and put those funds away for college. Work-study programs at colleges give students the option to stay on campus while working at a paid campus job. If you’re concerned that working will affect your grades, don’t be. Studies show that students who work actually do better academically.
4. Pay as you go
Most colleges offer pay plans so you can split the large tuition payments into smaller monthly payments. If you can’t afford tuition right now, work and take one class at a time when you can afford it. The degree may take longer but graduating without debt will make the sacrifice well worth it.
5. Join the military
The Montgomery G.I. Bill gives servicemen the opportunity to attend college during or after you have served. If full time military service doesn’t appeal to you, there are always the reserves or the National Guard. You can also investigate military colleges (such as the US Military academies) who award scholarships, ROTC as well, in exchange for a military enlistment when you graduate. Before you decide on this path, however, read the fine print and get acquainted with the rules regarding education benefits.
6. Apply for scholarships
There is a scholarship for every type of student. Make applying for scholarships a priority and you could attend college for free. Scholarships are plentiful, but you must apply. They won’t find you—you have to find them. Scholarship sites like Scholarships.com abound to help you find the perfect match; and don’t make the mistake that all scholarships are based on academics. There are scholarships with a short (3 sentence) essay, scholarships that require a text or a tweet, and even ones that only require an entry.
7. Get help funding from relatives and friends
Crowdfunding. It’s the new way to raise money for all kinds of worthwhile endeavors. But did you know that your student can use it to raise money for college? In the spirit of the famous quote, “It takes a village to raise a child”, crowdfunding takes college savings to a whole new level.
Though it might seem awkward asking for money for college, crowdfunding sites act as intermediaries. These sites allow students to submit a personal appeal for funds. Much like wedding registries that everyone is familiar with, crowdfunding sits act as a college registry to seek money to pay for college.
If you’re reluctant to solicit gifts for their children’s college funds, Gift of College would be an excellent crowdfunding source. With this unique offering, friends and relatives have an option to contribute to a 529 saving account by purchasing a gift card for special occasions and holidays.
The cards offer a tangible way to contribute to a college fund, rather than simply writing a check. You can purchase these gift cards online at their website or at various merchants to use as gifts.
8. Reduce college expenses
Reduce college expenses–reduce dorm costs (share with other students or become and RA); watch meal plans (sign up for the smallest one available); buy used textbooks or rent; sell your student’s car (won’t need one at college); take advantage of student discounts and free activities on campus. These reductions certainly add up.
9. Start saving now
Regardless of your current income level, you have the ability to save for your children’s college fund. You might have to trim your expenses, adjust your spending habits, and redirect your lifestyle in order to free up money for the college fund. But if you want to attend college without financing 100% of their education with borrowed money, then you’ll have to decide what’s more important.
Think you can’t save? Here are just a few examples: cut your teen to an occasional driver and save; food bills will decline when they are in college; stop subsidizing entertainment. It may require sacrifices but graduating without debt makes it easier to swallow that pill.
10. Save with every day spending
Upromise is a college savings service that harnesses the purchasing power of parents, extended family, family, and students to make it easier to pay for college. Members direct their spending to Upromise partners-including more than 600 online stores, 8,000+ restaurants, thousands of grocery and drugstore items-and earn money for college.
Wrapping Up
Making tough choices now will reap future rewards. Graduating without debt is possible; but it takes commitment toward that goal. For motivation remember that once you have that degree, you won’t have to worry about student loan payments when you enter the job market. Your salary won’t go toward loan payments—it can go towards enjoying your life and securing your future.