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How to Reduce College Costs

There is no doubt that a college degree is expensive. But are there any ways to get a college degree without having to spend a lot of money? Well, yes there are ways to not only get a college degree but also save money. It might sound insane to a lot of you. But before you close the browser, I would like you to give it a chance. So, with that being said, continue reading to find out how to reduce college costs and save some money at college.

How to Reduce College Costs

College fees continue to increase faster than inflation. This makes it increasingly difficult for students and their families to achieve their educational goals. But instead of giving up on the idea of going to college, why shouldn’t one figure out ways to help him not only learn how to reduce college costs but also get a college degree without having to spend a large amount of money?

1. Utilize the 529 College Savings Plan

According to the How America Pays For College 2021 report by Sallie Mae, one’s (parent) income and savings paid the majority of overall college expenditures, roughly 45% or $11,000 on average. This is no doubt a huge amount.

The college 529 savings plan allows families to grow their savings tax-free as long as the funds are utilized on approved educational expenses. Besides, the saving plans were used to pay a higher percentage of college expenses than noncollege savings accounts and retirement accounts.

Moreover, according to the spokesperson of Sallie Mae, about 37% of parents used a college savings account, such as the 529 college savings plan, to help them pay for their children’s college expenses in 2019 and 2020. However, this number does not seem to rise further which means only two-thirds of families use a college savings plan.

Hence, one of the best ways to reduce college expenses is to utilize a college savings plan such as the 529 college savings plan.

2. Apply for Local Scholarships

While colleges and universities may provide institutional scholarships, students can reduce their education costs even lower by applying for local scholarships. These are often sponsored by non-profit organizations, local groups, or NGOs.

In addition to that, some businesses also provide scholarships to workers’ dependents. Besides, local scholarships are often much less competitive than national scholarships and do not have large award amounts.

3. Get Financial Aid

Even at a very expensive private college, financial aid, including grants, can help students to reduce a large number of their expenses.

Many people make the mistake of believing that since their salary is too high for federal financial aid, they would not be able to get any sort of financial help. Besides, there is no doubt that government financial help has tight criteria. On the other hand, there are no clear guidelines for institutional financial aid.

After all, colleges and universities can set their own qualifying conditions for grants, scholarships, and other types of financial help.

Hence, you should always have an open eye to any possible financial aid either from your college or government. Besides, never miss any grant or financial aid considering that you might not be eligible for it. Apply anyways!

4. Consider a work-study program

According to the US Department of Education, over 3,000 colleges and universities offer Work-Study Programs. To be eligible for work-study programs, you must first complete the Free Application for FAFSA or Federal Student Aid.

Besides, keep in mind that even if you are eligible for work-study, you are not promised a job via the program. So, you must still have to find your own work. Therefore, check with the financial aid departments of the colleges you’re thinking about attending to see whether they have a work-study program.

In addition to that, also see what kinds of employment are available.

5. Begin Saving Early

Begin saving for college expenses as soon as possible using tax-advantaged vehicles such as Coverdell Education Savings Plans or ESAs and the 529 plans. Both plans provide federal tax benefits. However, the 529 plans are the only college savings plans that also provide state tax benefits.

529 plans aim to reduce the impact of financial aid while allowing families to save money for future educational expenses. Most states provide them, and they are normally accessible to all savers, not just residents.

So, whether you’re saving for yourself, a kid, grandchild, or another family or friend, 529 school savings plans have distinct advantages that can help you achieve other key financial objectives, including:

  • Anyone can make a contribution
  • There are no income restrictions
  • Very minimum investments
  • You can change the owner or the beneficiary at any time.
  • There is no federal tax on Withdrawals and earnings.
  • and much more

Furthermore, you can use the assets from your savings on tuition, dorm, books, computer, and other supplies. This will surely make it easier for you to manage your money at college.

6. Take Introductory College Classes in High School 

While you are still in high school, you can earn college credits that you may need to complete a degree. So, try to take the introductory classes while you are still in high school. These courses include the introduction to calculus, accounting, English composition, and many more.

So, do the following to earn further credit hours in high school.

  • Take AP classes
  • Talk to your professors about taking dual-credit classes.
  • Visit a local college to see if there are any options for high school.
  • Take a college course online

7. Handle Your Student Loans Responsibly

Student loans are appealing. After all, it is simple to take all available financial help and utilize it to attend the most costly institution or to enhance your college lifestyle. However, it is one of the most damaging things that you can do as a college student.  Remember that whichever student loans you get, you will have to repay them all with interest once you graduate. Everything contributes to the overall cost. The more money you borrow while you are in college, the more you will have to return later. This of course dramatically raises the cost of tuition ultimately. 

8. Enroll at a less expensive college

Even if you do not get financial help, an in-state public institution can cost less than a private non-profit college. Besides, there are also dozens of institutions with generous “no loans” financial aid programs that substitute grants for loans in the financial assistance package.

However, if you take a detour via a community college on your path to a Bachelor’s degree, you may end up missing your target. Only one-fifth of students who begin at a community college complete their Bachelor’s degree within six years, compared to two-thirds of students who begin at a four-year institution or university.

Nevertheless, a good way to learn how to reduce college costs is to enroll at a less expensive college.

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