college degree with no debt? (part ii)

18 Apr college degree with no debt? (part ii)

Last week, I shared some troubling statistics about the student debt crisis and the massive amount of debt the average college student incurs. I also shared some strategies for parents to consider so their child can graduate debt-free.

This week we’ll tackle some of the many ways students can help ensure they have no student loan debt:

• Start saving early. Every penny you save now for college will save you from paying off student loans – with interest – later.
• Consider community college. Many people go to a community college for two years and then transfer to a four-year school. If all your credits transfer, you get the same degree as those who attended for four years, and can save — literally — tens of thousands of dollars.
• Look at state schools. Your state schools likely have tuition which is far less than private schools.
• Live at home. Perhaps not as fun as living away at school, but the savings can be enormous.
• Consider a gap year. During that gap year, work as many hours as possible in order to save up for college. (Consult a tax advisor if your earnings could be substantial as there are tax implications.)
• Apply for every scholarship you can. One young woman mentioned in the Dave Ramsey book “The Total Money Makeover” sent in 1,000 scholarship applications, spending her summer writing essays. She only got 30 of them. However, those 30 scholarships provided her with $38,000 towards school! There are many websites which offer scholarships, including fastweb.com. In addition, civic organizations and your guidance office (even if you are homeschooled) can help you. And, of course, the college you plan to attend also likely has many scholarship opportunities.
• Consider a different type of college experience. There are some schools where you are required to work at the school in exchange for tuition. Other schools offer much lower tuition if you do an internship while you are taking classes. Search for alternative colleges online. My youngest child is currently doing an internship through a church which is affiliated with a university. He will graduate with a full degree at about one-third of the cost.
• Ask your parents if their workplace offers any benefits that help with educational expenses, especially if they work at a college or university.
• FAFSA (studentaid.gov) – this is the Free Application for Federal Student Aid. Filling out this form allows you to be considered for federal student aid. You will be asked for detailed financial information and more. The end result is a number which details what your expected family contribution is, how much you can take out in federal loans (not a good idea), and any federal grants available. In addition, schools use this information to determine scholarships and grants. Don’t get your hopes up in terms of receiving federal grants, however. You can only submit this form for a limited time each year and it is recommended that you do so even if your family’s financial situation is fine – if your parents end up losing a job after the FAFSA due date (June 30) but haven’t submitted a FAFSA, you are out of luck.
• Finally, consider other alternatives. While the “average” person with a college degree earns much more over their lifetime than someone without a degree, it is not written in stone that everyone must have a degree. For some, this will mean attending a trade school. For others, it means simply starting to work after you graduate from high school. If you are wise with your money and save, you can be as successful financially as someone with a four-year degree.
  
  Keep in mind that most funding you receive through scholarships, grants, and the like must be used for certain purposes. If you quit school or flunk a class, you may need to repay the money.
  
  My children were able to graduate debt-free with a combination of very hard work (between the three of them, they have held the following jobs: wedding videographer, transcriber, restaurant host, lifeguard, valet, janitor, summer camp counselor, daycare helper), 529 plans that were started when they were toddlers, scholarships from community groups and their colleges, applying to be a graduate assistant (which provided a free graduate degree), and an educational benefit.
  
  There’s nothing like the feeling of walking across the stage at graduation debt-free. You can do it!
  
  For more resources I recommend the book “Debt Free Degree” by Anthony ONeal. I’d love to help you get your debt-free degree, or work with you to get out of debt. Visit yourwalletwellness.com to set up a complimentary consultation.