Paying for College 101


After years of toiling away in high school, the end is finally near: college is almost here! But is that really a good thing? The average 2016 graduate now has more than $35,000 in student loan debt to their name. Do you really want to join the millions of American who suffer from debt after graduation?

College is not just a treasured American tradition. It comes with tangible career benefits, from lower unemployment rates to higher salaries. Of course, if your debt keeps you down after earning your degree, those benefits can seem awfully theoretical.

Fortunately, it’s not necessarily a catch 22. As it turns out, you can graduate from college while still maintaining relative financial security – if you know how to pay your cards right.

So consider this your first higher education class. Welcome to Paying for College 101, a 10-step process to success.

1) Go Beyond the Sticker Price

First things first: you need to understand how much every college you consider applying to will actually charge. Here, it’s crucial to go beyond tuition. Sure, it can give you a first idea of how much you will eventually have to pay. But it’s not a comprehensive overview of your actual cost.

Room and board, fees, books, and cost of living are just a few of the many variables that play into the cost of your education. With these variables in mind, two universities with identical tuition can cost very different amounts. In addition, some universities have gone to a per-credit tuition system that makes understanding your actual cost more difficult. A variety of cost calculators can help you better understand how much you will actually have to pay.

2) File Your FAFSA Early

Once you have a general idea of your cost, it’s time to get to work on finding a way to pay for college. Your first step in that process should be to fill out your FAFSA, short for Free Application for Federal Student Aid.

Put simply, your FAFSA takes your family’s income into account to determine how much financial aid you should receive to cover a financial need in your family. As a result, it’s considered need-based aid. Depending on how you fill it out, you might be eligible for:

  • Pell grants, which (like any grant) do not have to be repaid after your education is complete.
  • Financial aid from your home state, which depends based on your current state of residence.
  • Institutional aid, depending on the college to which you’re applying.
  • Federal work study money – more on that below.
  • Federal student loans, which need to be repaid but typically come with low-interest rates.

You can learn more about the FAFSA, including deadlines and materials needed for a successful application, in this comprehensive guide.

3) Understand Your College’s Financial Aid Opportunities

Of course, the need-based aid that your FAFSA determines might not be enough to cover all college expenses. In that case, it makes sense to inform yourself about financial help you can get based on your academic achievements, extracurricular activities, and more.

You will come to know this type of assistance as merit-based aid. It can cover a wide spectrum, from athletic scholarships to out-of-state tuition waivers and even grants for being a first-generation student. The exact aid available differs from school to school, so talk to your admissions counselor about the opportunities for your college(s) of choice.

4) Look for External Scholarships

If a combination of need-based and merit-based aid doesn’t cover your expenses, you don’t have to stop trying to look for assistance. Thousands of scholarships are available every year through a wide range of institutions and professional organizations that are not connected to individual schools.

The CollegeBoard’s Scholarship database, for instance, includes 2,200 individual scholarships that total nearly $6 billion in aid. Awards can range from a few hundred to five digits, available for anyone from students with disabilities to volunteer firefighters. You can even find scholarships specifically for left-handed students, or for studies looking to enhance the potato industry.

5) Use Your Senior Year Wisely

Chances are you start thinking about college (and affording college) long before you graduate from high school. But simply applying for a FAFSA and other financial aid doesn’t mean you should stop trying your best during your senior year.

Instead, as U.S. News and World Report details, your final year of high school is a crucial time for your financial aid eligibility. Colleges have the right to change their award based on your performance, which can influence the amount of aid you will get. Improve your grade point average, and your financial aid from your dream college might just increase. Do worse, and the college that has accepted you can decrease your aid.

6) Understand Your Award Letter

Your financial aid award letter will break down exactly how an institution that admits you plans to help you afford your studies. Unfortunately, it can be technical and difficult to understand for those not deeply involved in the financial aid process.

The key to success in this step is simple: know exactly what your prospective college is offering you. Understand the terms they use, the differences between grants and scholarships, and how much money you will actually get. Then, use that information to choose the best college for your financial situation.

7) Stay Within the Deadlines

Every college has deadlines by which you have to apply for, accept, or appeal your financial aid. Often, these deadlines are directly connected to enrollment and tuition deposit deadlines. The earlier you know them, the better you can plan ahead to make sure that you don’t let any deadline lapse or financial aid get away.

8) Find a Work Study Job

Your FAFSA results may indicate that you’re eligible for federal work study. In that case, you can find a part-time job (typically up to 20 hours per week) on campus that helps to pay for your books and living expenses.

Even if you’re not eligible for federal work study, many colleges offer student work positions that are paid from university budgets. A student job, especially when connected to your major, allows you to gain practical experience before graduation all while helping you pay for college.

9) Join the Gig Economy

Are you out of luck with work study positions or looking for even more opportunities to pad your wallet? In that case, you might be able to take advantage of increasingly available freelance opportunities online.

Market places like Fiverr allow you to offer any (above-board) services to interested businesses and clients online. Education majors can engage in online tutoring, while computer science majors can help local businesses improve their networks and cybersecurity. The opportunities are there if you know where to look.

10) Use Student Loans Strategically

An understanding of all of the above opportunities alone can make paying for college a lot more affordable than you think. But in most cases, you will still need student loans to cover even small differences between financial availability and the cost of college.

When that’s the case, the key is using student loans strategically. Look for not just low-interest rates, but also services that are well-reviewed and won’t change terms of service on you after you sign up. Rather than simply signing up with your nearest bank, understand your options through thorough online research.

We want to help you afford college. The value of a higher education degree is still immense, even if it can get expensive. If, after exhausting all of your financial aid, scholarship, and student work options, you still need help, contact us. We’d love to work with you in making sure that your college experience is as affordable as it is memorable.