VWB Blog In the United States, college costs one student an average of $35,551 each year. This includes books, supplies, and daily living expenses. The average cost of college increases by 7.1% annually and has doubled in the 21st century.
If you’re planning on going to college soon, you’re likely overwhelmed at the thought of paying tuition fees. Now is the time to put a plan into place by learning different ways you can pay for college.
You may be surprised to see there are more ways to cut costs than you realize. Luckily, you can keep reading this guide to learn the top 12 ways to pay for college!
1. Apply for Federal Student Aid
Applying for student aid is one of the very first things you should do. Don’t skip this step because you think you won’t qualify.
The first step is filling out the Federal Student Aid (FAFSA) form online. Once you complete this form, you will be able to access work-study opportunities, federal grants, and student loans.
You may also be able to access additional financial aid from your school or the state you live in.
Many people are confused about how to get a student loan, but filling out the FAFSA will tell you what you qualify for.
2. Apply for Grants
Once you fill out the FAFSA, you’ll be able to access numerous grants that are available to students.
The best part about grants is that you don’t need to pay them back. You’ll receive grant money to cover your tuition costs as long as you’re eligible.
There are several grants you may be eligible for. First, the US Federal Government administers the Pell Grant, one of the most common grants you can get. They’re available to undergraduate students who have financial needs.
There are also Federal Supplemental Educational Opportunity Grants (FSEOGs). These grants are for students that have severe financial hardship. However, not all schools participate in the FSEOG program.
Additionally, you’ll find many other grant programs during the process, like the Iraq and Afghanistan Service Grant. You may qualify if you have a parent or guardian who was a US armed forces member and died from military service in Afghanistan or Iraq.
Finally, specific grants like the Teacher Education Assistance for College and Higher Education Grants (TEACH) pay for students who want a career in teaching.
3. Look for Scholarship Opportunities
Don’t underestimate scholarship opportunities. Many times you can find some of the best scholarships by doing a little research.
Start with a basic Google search for scholarships nationwide and local to your state. You’ll find numerous websites like Scholarships.com that allow you to look through available scholarships in your state and field of study.
Check with your employer to see if you’re currently working. Many people don’t realize that various organizations offer scholarships to students going into specific fields. They may also provide these scholarships to their employees.
Local scholarships offered by charities, non-profits, and small businesses are also common.
If you’re involved in your church and are interested in attending a Christian institution or have an interest in pursuing a degree in religious education, check out these best scholarships for Christians.
Overall, if you have particular hobbies or interests, you’ll usually be able to find a scholarship that fits your needs.
4. Attend College In-State
If you’ve been planning to attend college for a long time, you might have a particular one in mind. However, if this college is out of state, it may not be a realistic goal.
Choosing an in-state college can cut your tuition costs by at least half.
Some states give students a chance to attend a community college for the first two years and then transfer to a college or university in their junior year to save even more.
You may also be eligible to receive extra financial assistance if you attend an in-state college. This could be in the form of loans or scholarship programs.
Even more, attending an in-state college gives you extra options. You could attend school part-time and live at home. If you’re dreaming of an authentic “living away at college experience,” you could do this for a few years and transfer.
The bottom line is that in-state colleges give you access to more options than you think they do.
5. Start a 529 Plan
If you’re in the process of saving for college, it’s well worth looking into a 529 plan. The 529 plan is a tax-advantaged savings plan designed to pay education costs.
There are two main types of 529 plans; prepaid tuition and education savings.
Education savings plans are tax-deferred, meaning you can save money for college tax-free. Withdrawals on this plan are tax-free as long as you use it for a qualified educational expense.
A prepaid tuition plan allows you to pay current tuition rates for when you attend specific colleges or universities in the future. Basically, this will enable you to lock in a lower tuition rate for later.
It’s pretty straightforward to open a 529 plan. You’ll need to compare plans across different states and open an account when you find one that meets your needs.
It’s often easier to work with brokers like Fidelity Investments to help you open a 529 plan that works.
6. Look into Employer Tuition Assistance
If you have a job, don’t overlook your own employer’s tuition benefits. Many companies all over the country offer some tuition assistance.
For example, McDonald’s, Home Depot, and Chipolte help their employees attend school in some capacity.
Keep in mind that tuition assistance is usually limited to a specific amount each year and for a particular program. You’ll need to ask your HR department how to apply for the program.
With tuition reimbursement, you’ll have to pay for the tuition costs upfront, and your employer will reimburse you later.
This is an excellent option for college students who don’t plan to attend college immediately after high-school graduation. It allows you to work and save for college, ultimately reducing your debt.
7. Work Part-Time
Although it’s challenging to work and go to school, it can lead to college opportunities you wouldn’t usually have.
You’ll be surprised how much working part-time can actually help. You’ll be able to make enough money to cover tuition or part of your living expenses.
You should also look for internships. You can often find internships available throughout the year and during the summer. They’re a great way to make money and connections in your field.
Remember, not all internships pay, but plenty of paid internships are available; you just have to do some research.
It’s best to look for internships before summer starts to see what’s out there. It’s also wise to check with the school you plan to attend. Many colleges have various internship opportunities and student jobs you can take advantage of.
Finally, you could even consider freelance work while going to school. If you have writing, art, or technology skills, you can easily freelance your skills to help pay for school.
8. Go to School Part-Time
Another option to consider is attending school part-time. While it will take longer to earn a degree, going this route can pay off in the long run.
First, you can still access federal loans to pay for part-time school. In addition, many grants are available for part-time studies. You’ll be paying for your classes as you go along.
Doing this allows you to pace yourself more and save a lot of money long-term.
Part-time school also allows you to work more hours and save money. Ultimately, you’ll graduate from college with much less debt.
Before deciding to go this route, you must form a plan. Going to school and working is extremely busy and stressful. A solid plan will help you manage everything along the way.
9. Set Up a Payment Plan
Many schools allow students to sign up for a payment plan after enrollment. This allows you to avoid paying your tuition in one lump sum. It’s beneficial if you don’t want to take out student loans or don’t qualify for grants.
In some cases, payment plans can help you avoid taking out a loan altogether. Even if you don’t see it advertised, call the college you’re considering to see if payment plans are an option for you.
Be sure to ask questions about their payment plan fees. Typically, you’ll have to pay an administration fee to sign up for this type of plan.
10. Consider Private Student Loans
If you need more money than government loans provide, you can consider taking out private student loans.
Most banks offer student loan options with varying interest rates. If you have good credit, you may qualify for a low-interest rate. Depending on your age and credit history, you may need a co-signer.
Your co-signer will need good credit and a steady job. Remember that private loans aren’t guaranteed, and you may not qualify for them. However, they’re an option for many people who need to attend a full-time program.
Before taking out any private loans, be sure to shop around some. There are a variety of options out there, so you don’t want to go with the first loan you come across.
11. Test Out of Classes
If you’re still in high school, you can reduce the number of college classes you must take by signing up for Advanced Placement (AP) classes. Taking these classes allows you to earn college credits, saving you money.
Remember that receiving college credit isn’t limited to high school students. You can also get prior learning assessments through a portfolio assessment and evaluation of noncollege learning.
Even more, you can take a look at the College Level Examination Program (CLEP). These exams give you a chance to test out of introductory courses so you can take advanced courses much sooner.
You can take CLEP exams year-round in as many subjects as you like. The best part about CLEP exams is that anybody is eligible to take them.
Getting these course credits can save you thousands of dollars in tuition each year. You’ll be able to go to college and take only the courses you need.
12. Take Advantage of Tax Credits
Finally, don’t forget to take advantage of educational tax credits. These credits allow you to claim back educational costs on your yearly taxes.
The American Opportunity Tax Credit (AOTC) is a credit you can claim for the first four years of your college education. This credit is worth up to $2,500 each year, and you can claim 100% of the first $2,000 of your educational expenses. After this, you can claim 25% of qualified education expenses.
To be eligible for AOTC, you need to meet the following criteria:
- Be enrolled in school at least half time
- Be pursuing a degree
- Be in your first four years of higher education
- Not claiming this credit for more than four years
- Not have any felony drug convictions
You’ll need Form 1098-T, a tuition statement from an eligible educational institution, to claim the credit.
You can also take advantage of the lifetime learning credit (LLC). This credit helps pay for undergraduate, graduate, and professional courses to improve job skills. There is no limit on how many years you can claim this credit.
You can claim up to $2,000 on your yearly tax return and 20% of the first $10,000 of your educational expenses.
To claim this credit, you must be a student at a higher educational institution. You’ll need to be enrolled at the beginning of the tax year to make a claim. You’ll also need Form 1098-T to claim this credit.
Don’t hesitate to talk to a tax professional about the different educational credits you can claim. You may be able to save more money this way than you realize, depending on your financial situation.
Use These Tips to Pay for College
Following these tips will help you pay for college and land the career of your dreams in the future.
Paying for college is no easy task, so you’ll need to take everything one step at a time. Don’t be afraid to talk to the college you want to attend about other financial aid opportunities.
To learn more helpful education and lifestyle tips, be sure to read the rest of our blog articles today!