People who earned a bachelor’s degree in 2015 graduated with an average of $30,100, according to the Project on Student Debt, and while that number tends to grow each year, that doesn’t mean you need to go thousands of dollars into debt to get an education. It’s possible to get a college education without taking on a ton (or any) student loans, even when your parents can help you pay. Still, keeping your college costs down takes some work.
With higher education costs skyrocketing over the past couple of decades, you’ll want to spend just as much time researching financial aid, scholarships and grants as you do deciding where you want to attend and what you want to study — perhaps even more.
Choose Your School Carefully
Whether or not you need student loans heavily depends on where you attend college. First of all, tuition varies widely by school type. Here are the average annual tuition rates by school type, according to the College Board:
- Public Two-Year College (in-district students): $3,440
- Public Four-Year College (in-state students): $9,410
- Public Four-Year College (out-of-state students): $23,890
- Private Four-Year College: $32,410
Second, many schools heavily discount their sticker price with merit scholarships and other aid sources. You want to try to find out a school’s typical net price: How much a student tends to pay after non-loan financial aid. For example, the average family pays $3,980 per year for a student to attend a public four-year college, according to the College Board — $5,430 lower than the average sticker price.
Many schools have a net price calculator on their site (an internet search of the school’s name and “net price calculator” is a good way to find it), so start there if you want to know what you may have to pay out of pocket. From there, you can try to figure out whether or not it’s affordable.
Apply for Scholarships
More than $3.4 billion in scholarship money is available to students, according to Fastweb.com, a free scholarship database. Not all require stellar grades or winning essays, but most require applications.
Start searching early to find out whether scholarship money for college is available for you. (You don’t have to decide on a particular school before you start your research.) There are scholarships based on everything from ethnicity and honors earned in school to unique situations such as being an orphan, a child of single parents or receiving foster care. As Fastweb notes, securing scholarships “is a numbers game. The more scholarships you apply for, the better your chances of winning.”
Check Out College Grants
College grants are similar to scholarships in that you generally don’t have to repay them. But they are usually based on need, rather than merit or other qualifications.
Most people have heard of Federal Pell Grants, which are available to students who qualify based on need. They offer a maximum of $5,815 in aid for the 2016-2017 award year. (You can check the Department of Education website for current information.) In addition, there are several other federal education grants, including Federal Supplemental Educational Opportunity Grants (FSEOG) for undergraduate students with exceptional financial need.
Schools themselves may offer grants, and there are organizations that offer grants for minorities, women and other groups. If you’re looking at a school in your state of residence, you’ll want to see what sort of grants your state offers. Some of those deadlines may come up months before you decide where to attend, so don’t delay researching them.
Apply for Financial Aid
If you are a prospective student, it’s a good idea to complete the the Free Application for Federal Student Aid (FAFSA), even if you aren’t sure you will qualify for financial assistance. Just as the name suggests, it is completely free and can help you find out how federal aid can help you pay for a college education. As the Department of Education points out, millions of students are awarded approximately $150 billion in aid in the form of grants, low-interest loans and work-study funds to help them pay for college.
In order to be eligible, you must fill out the FAFSA. Many aid sources besides the federal government require applicants to fill out the FAFSA as well. Most experts recommend you apply as close to January 1 as possible, because some agencies award aid on a first come, first served basis. In addition, schools and federal and state agencies also have deadlines.
Work While in School
If you have exhausted your options for scholarships and grants, consider working while you are in school to help cover expenses. This may mean taking fewer classes and delaying the day you graduate, but it may also allow you to graduate with less debt.
You may also want to consider working for an employer that provides tuition reimbursement. Some students are able to get their degrees paid for this way. It can be a particularly attractive option for those pursuing a graduate degree for which less financial aid is available.
Some students save significant money by going to a community college for two years and then transferring to a four-year institution. You have to be careful if you take this route to ensure that the credits you earn initially transfer, but if you do your homework, this can be an excellent way to get a diploma from your school of choice at a fraction of the cost.
Taking out student loans isn’t necessarily a bad thing. By helping you get a college degree, student loans can play a crucial role in increasing your earning potential. Student loans can also help you build credit if you consistently make your loan payments on time. Of course, failing to repay your student loans can damage your credit, which is why it’s important to only borrow what you need — and what you can afford. You can see how your student loans are affecting your credit by getting a free snapshot of your credit report on Credit.com.
To learn more about managing debt, read more from our experts by visiting our Debt Learning Center. You can also get tips about how to manage student loan debt by visiting our Student Loans Learning Center.
This article has been updated. It was originally published October 30, 2013.