Here are 6 ways to save money on a college education

For many students and families, the rising cost of higher education feels like an insurmountable challenge. Questions like “Which school is right for me?” or “Makes prestige they carry more weight than knowledge?” carry their share of weight, but one question always stands out: “How can I save as much money as possible?”

The numbers show the average total student loan debt – including private loan debt – in the United States can be as high as $40,681, with the average federal aid loan owed a whopping $37,853 per person.

While FAFSA (Free Application for Federal Student Aid) is a key tool for unlocking grants, loans, and work-study program opportunities that can help mitigate some higher education expenses, relying solely on FAFSA can sometimes lead to the astronomical debt, and not all students. qualify for the amount of help they need.

The good news? There are other ways to save money from your education expenses. Whether you’re looking to avoid excessive student loans or supplement your existing financial aid, these practical, affordable options can make higher education more accessible and affordable:

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1. Community college

Entrance to the community college building. (iStock/iStock)

What’s in a name? While attending top-tier universities like Harvard, Stanford, Yale or Columbia could be the dream, these schools and others like them can sport a high price.

To break it down:

• U College Board reports that the average annual cost of tuition and fees for a public 2-year college for the 2022-2023 school year was $3,440 for students in the district.
• The average annual cost for a 4-year public university was $9,410 for in-state students and $23,890 for out-of-state students.
• For a 4-year private university, the cost rises to $32,410 per year in tuition and fees.

Even completing just two years at a less expensive school and transferring to a more expensive institution can knock some off your overall college expenses.

“This is really big for us in California, where you do two years at a junior college and transfer to, say, UC Santa Barbara, UCLA or Berkeley,” said Greg Kaplan, a college admissions strategist based in the Golden State. Fox News Digital.

Kaplan pointed out that many students start at community colleges and later transfer to more prestigious top universities. This path allows students to earn a degree—and institutional recognition—from a top university, but at a fraction of the cost of attending all four years at that dream college.

“We worked with a student who started at Arizona State University for two years on a full-tuition scholarship, and transferred to Northwestern, which is extremely expensive, very prestigious. So he only had to pay for two years,” he explained.

2. Make your boss your partner

A barista pours steamed milk into a beverage cup marked “Steven” at a Starbucks Corp. coffee shop. in the Sandton area of ​​Johannesburg, South Africa on Monday 14 January 2019. (Waldo Swiegers/Bloomberg via Getty Images/Getty Images)

Some employers will reimburse tuition for degree programs that could potentially enhance their employees’ on-the-job skills. In other words, you save money and your employer gains a more talented and well-rounded employee. It’s a win-win for both parties.

Tuition reimbursements are often limited to $5,250 per year in accordance with Section 127 of the Internal Revenue Code (IRC), which allows companies to provide that amount of dollars in tax-free assistance. This can be written off as a business deduction for the employer and employees get reimbursed as a tax-free benefit.

But some employers can do much more than that, even covering the cost of the employee’s bachelor’s degree in full.

“It’s not just matching employers,” Kaplan said. “If you’re a young person, and you’re going to be a first-time worker, you might want to think about working for a company that could be your partner… I’ve talked to people who go to work specifically places like Starbucks because they can taking Arizona State online classes, and doing it to get their degrees.”

Starbucks College Achievement Plan (SCAP) offers eligible employees 100% upfront tuition coverage for a first-time bachelor’s degree through Arizona State University’s online programs.

Amazon’s Career Choice Program also pre-pay tuition and fees up to an annual limit, and Walmart’s Live Better U The program offers eligible Walmart employees the opportunity to expand their education on the company’s dime.

3. Parental employee benefits

A person holds a jar full of savings money. (iStock/iStock)

Rather than relying solely on their employer, some college applicants can take advantage of employee benefits from their parents or guardians, most commonly through company scholarships.

Companies like Chevron, PepsiCo and Wells Fargo offer scholarship opportunities reserved for children of eligible employees. PepsiCo Foundation Family Scholars The program, for example, offers a renewable reward of up to $5,000 for selected winners who pursue an eligible education program with the funds.

After being accepted by a university, it is worth exploring the benefits for the employer and applying for the scholarship if the eligibility criteria are met.

This amount, combined with the potential for federal and state aid, can significantly reduce the cost of higher education.

4. Open a 529 Account

Jar with label and money on the table. The concept of saving money. (iStock/iStock)

While it is best to open a 529 account when college savings begin while the college applicant is a child, creating an account as an adult and adding small amounts can add up over time.

What is a 529 plan? A 529 account is a tax-saving account designed specifically for education expenses. Contributions to this account grow tax-free, and withdrawals are also tax-free if used for qualified educational expenses (eg, tuition, supplies, room and board, etc.).

It is different from a basic savings account as the money has the potential to grow instead of standing still.

“If you can put in a few thousand dollars a year, of course it all helps,” Kaplan said.

However, a 529 only extends so far. Kaplan notes that 529 plans alone cannot cover a large portion of tuition costs, especially at private universities.

“It wasn’t enough to pay for my overpriced private university,” he added.

5. Prioritize the SAT/ACT

Close-up of a pencil on a page of an SAT college entrance exam preparation book, taken on August 6, 2017, in Melville, New York. (Thomas A. Ferrara/Newsday RM via Getty Images/Getty Images)

While many colleges have maintained an optional testing policy in the post-pandemic age, high SAT or ACT scores can give students an edge when it comes to merit-based scholarships. Scoring well on standardized tests can help students unlock thousands of dollars in automatic aid, helping to ease the burden of their overall tuition bill.

“For example, if you get a 32 on the ACT or a 1400 on the SAT, that automatically qualifies you for a massive (about) $30,000 scholarship at the University of Alabama, Tuscaloosa,” Kaplan said, noting other colleges . and universities award similar amounts.

“These scholarships are automatic based on test scores and grades, so study for the SAT or ACT, even if it’s not necessary. Giving your all could potentially pay for all the schools.”

While taking multi-hour exams seems daunting to many high school students, putting in hours of practice through extra courses, practice exams, and even seeking help from tutors could lead to a drastically different financial outcome in the long run.

6. Consider consortium programs

A lesser-known way to save on college costs is to take advantage of state scholarship programs, which allow students to attend out-of-state public universities at reduced tuition rates. These arrangements can help families avoid the price overruns often associated with non-residential tuition.

In states like California, the Western Undergraduate Exchange (WUE) is a game changer. This program allows students to apply to more than 150 colleges in the western United States – including schools in Montana, Hawaii, Wyoming, Arizona, California and Nevada – while paying reduced tuition rates.

“If I have a 3.3 GPA, I can go to the University of Utah for in-state tuition plus a small supplement as a California resident, so it’s cheaper for me to go to the University of Utah at $11,000 to the year than for me. go to any public university in the state of California,” Kaplan explained.

“There are different consortia in the Northeast, in the Southeast and in the Midwest and in the West, and these are ways that these universities try to diversify their students based on geography. I think a lot of people don’t understand not that these consortia exist and that can put many more schools in play, and it can end up being the right one for you or your child”.

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