Here are 6 ways to save money on a college education

For many students and families, the rising costs of higher education feel like an insurmountable challenge. Questions like “Which school is right for me?” or “Does it overtake they have more weight than expertise?” carry their share of the weight, but one question keeps standing out: “How can I save as much money as possible?”

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

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

good news? There are other ways to reduce the cost of education. Whether you’re trying to avoid exorbitant student loans or supplement your existing financial aid, these practical, cost-effective options can make higher education more accessible and affordable:

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1. Community College

What’s in a name? While attending a top university like Harvard, Stanford, Yale, or Columbia might be a dream come true, these schools and others like them can come with a hefty price tag.

To break it down:

• The Senior management reports that the average annual cost of tuition and fees for a public two-year college for the 2022-2023 school year is was $3,440 for students in the district.
• The average annual price for a public four-year university was $9,410 for in-state students and $23,890 for out-of-state students.
• For a private four-year university, the cost increased 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 lower your overall college costs somewhat.

“That’s 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 emphasized that many students start at community colleges and later transfer to more prestigious leading universities. This pathway 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 two years at Arizona State University with full tuition, and he transferred to Northwestern, which is extremely expensive, very prestigious. So he only had to pay for two years,” he explained.

2. Make your employer your partner

Some employers will reimburse the cost of tuition for degree programs that could potentially improve their employees’ skill set in the workplace. In other words, you save money and your employer gets a more talented, well-rounded employee. It’s a win-win for both parties.

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

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

“It’s not just about finding employers,” Kaplan said. “If you’re a young person and you’re going to be a startup, maybe you should consider working for a company that could partner with you… I’ve talked to people who specifically go to work at a place like Starbucks because they can take online classes in the state of Arizona and they do it to get degrees.”

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

Amazon’s career choice program similarly prepays tuition and fees up to the annual limit, and Walmart’s Live Better U program offers eligible Walmart employees the opportunity to further their education with company money.

3. Benefits for parents of employees

Rather than relying solely on their employer, some college applicants may benefit from benefits from their parents or guardians, most often through company scholarships.

Companies such as Chevron, PepsiCo and Wells Fargo offer scholarship opportunities reserved for the children of eligible employees. PepsiCo Foundation Family Scholars program, for example, offers a renewable award of up to $5,000 to selected winners who will use the funds to pursue an eligible educational program.

Once you’ve been accepted to university, it’s worth researching employer benefits and applying for scholarships if the eligibility criteria are met.

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

4. Open a 529 account

While it’s best to open a 529 account when college savings begin while a 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-advantaged savings 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 differs from a basic savings account because the money has the potential to grow instead of sitting idle.

“If you could set aside a few thousand dollars a year, of course it helps,” Kaplan said.

However, 529 only stretches so far. Kaplan notes that 529 plans alone may not cover much of the cost of tuition, especially at private universities.

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

5. Prioritize the SAT/ACT

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

“For example, if you got a 32 on the ACT or a 1400 on the SAT, that will automatically qualify you for a major [approximately] A $30,000 scholarship at the University of Alabama, Tuscaloosa,” Kaplan said, noting that other colleges and universities award similar amounts.

“These scholarships are automatically based on test scores and grades, so studying for the SAT or ACT, even if it’s not required. By doing your best, you could potentially pay for all of your tuition.”

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

6. Consider consortium programs

One lesser-known way to save on college costs is to take advantage of state consortium programs, which allow students to attend out-of-state public universities at lower tuition rates. These deals can help families avoid the high prices often associated with non-resident tuition.

In states like California, the Western Undergraduate Exchange (WUE) is changing the rules of the game. This program allows students to apply to more than 150 colleges across the western US – including schools throughout Montana, Hawaii, Wyoming, Arizona, California and Nevada – while paying reduced tuition.

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

“There are different consortia in the Northeast, the Southeast, the Midwest, and the West, and these are ways that those universities try to diversify their student body based on geography. I think a lot of people don’t realize that these consortia exist and that they can involve many more schools, and maybe will end up being the right thing for you or your child.”

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