College can be a huge expense, and everyone has to find a different way to pay for it. If you are here, then you already have a head start. Let’s look at some things you could do in order to graduate debt-free from college!
“Debt is like any other trap—easy enough to get into but hard enough to get out of.”
Henry Wheeler Shaw
How do students accumulate college debt?
Understanding how to overcome or avoid college debt starts with understanding how the problem arises. Let’s look at some of the typical suspects.
- Student Loans: Whether it’s private or federal student loans, both play a huge role in the debt incurred by college students. In fact, according to The Washington Post, roughly 1 in 5 Americans have student loans. These students did not have enough funds to cover the initial costs of school tuition, fees, reading materials, and possibly room and board. This leaves students with the option of either federal or private student loans if they are not capable of subsidizing the needed funds from another source.
- Rising Cost of College Tuition: Due to factors such as State budget cuts, larger staff, and increasing facilities, the Education Data Initiative found that the cost of college tuition at a 4-year public university has risen by 31.4% from 2010 to 2020. This rise in tuition has made attending university much less affordable over the years, and the effects of these price increases are affecting people’s ability to attain their degrees while maintaining any sense of financial freedom.
- Becoming Delinquent Borrowers: According to BestColleges, in the year 2021, roughly 7% of student loan borrowers will default, and another 270,000 people will be delinquent on their student loans. This inability to maintain consistency while paying on loans results in these loans incurring interest, which will make it far more difficult for the borrower to ever get back on track with their original payment plan. Becoming a delinquent borrower is also a mental stressor that can weigh on people’s physiological selves and cause massive stress over the years.
Start a 529 plan.
A 529 Plan is a way in which each state helps its residents save for college expenses before their child goes to college. It allows the parents to put away money (tax-free) as an investment in the education of their children. These funds may be spent tax-free on school-related fees, but if not spent on school-related fees, they will ensure fees. Click here to see the official SEC webpage on 529 Plans and their rules and regulations.
Live at home during college.
Housing is one of the most costly parts of attending college. Depending on the college, you could spend thousands of dollars a year on room and board. Although it may be considered “part of the college experience” to live on campus, it can be extremely expensive and impractical. Instead, consider living at home, where you could save money on housing, food, water, electricity, sewage, trash, and more! Now you see why living at home could easily be one of your most practical solutions to saving money!
Find an employer that will pay for college.
Many employers are extremely friendly to college students and knowledgeable of the struggles their college-attending employees may face. Companies such as Disney and Amazon take great pride in paying for some or even all of their employees’ college expenses. These programs are great as they allow you to both pay for college and make a side income at the same time. Click here to see 40 companies offering to help pay for employees’ college.
Choose a more affordable school.
Have you ever considered that there may be a more affordable school that also offers a great program? Well, there probably is. This is especially true if you are considering attending college out of state or at an Ivy League school. Despite the hype for these universities, you have to consider the debt you will incur and whether a degree from these universities will have an effect on your employment or wage potential.
Apply for scholarships.
Do you like free money? Well, this is not quite that, but it is about as close as you will ever get. Take the time to search around for scholarships in your area that you feel are a good fit. With a personal letter and a few letters of recommendation, you might just be awarded a scholarship of your own. When thinking of applying for scholarships, check with your school advisors about local and school-specific scholarships. Also, check out the AP College Board Scholarship Finder to conduct a more vast scholarship search.
Take DE/AP classes while in high school.
Are you still in high school? If so, consider taking some of the AP and dual enrollment courses offered at your high school. These courses allow you to obtain college credits at a fraction of the cost of taking them at the university. Obtaining these credits can also afford you the opportunity to graduate from university earlier; therefore, you will have to pay even less to the university.
Work a part-time job
This is actually common. Working a part-time job is both manageable and practical, as it allows the student to focus on their studies without drowning in debt for doing so. Anyway, working a job in college can be a great way to get away from the constant mental exhaustion of university study and assignments.
Find a work-study program.
This program allows you to work directly for the university in order to pay off your student debt. The program allows you to work in a position that is directly related to the degree you are working for, and in this way, it is a “win-win” scenario as you get paid to learn. Check out Federal Student Aid’s webpage to learn more about this program.
Join the military.
Feeling patriotic? Easy fix: private! The United States Military offers: college repayment, tuition exemption, the GI Bill (multiple variations), and more! It is possible to join as enlisted personnel or to commission as an officer. Click here to check out the official government website for help understanding what branch would be right for you!
Federal Loan Forgiveness
Are you already a college graduate? Did you take out federal student loans? Well, you may be entitled to forgiveness of the loans, depending on your degree and the field you choose to work in. Click here to check out Federal Student Aid’s official page on federal student loan forgiveness!
Apply for Federal grants.
Now here is a way to get those funds quickly!
By filling out the FAFSA (click here to fill out the FAFSA), you can check to see what kind of grants you may be eligible for. The value of these grants varies, and whether you are a dependent or not will likely play a big role in what grants you qualify for. But all money is good money!
More ways to save!
So you realized that you would have to become more financially responsible to make it through college debt-free? Great! Check out our article “Clever Ways to Manage Finances As A College Student” for some more information on this topic.
