There are currently 44.2 million Americans with a combined student loan debt of $1.48 trillion.
The average college student is going to graduate with $37,000 in student loan debt.
These numbers are increasing every year.
Save yourself a lot of time, money, and stress by following the steps below.
Take action now: Before we begin, take action now, and download the FREE Ultimate Financial Planner. Paying off debt and managing your finances can be FUN. Included is a bonus debt thermometer.
1. Apply for scholarships
Most people end up not applying for scholarships because they don’t know where to find them.
One scholarship saved me almost $8,000 one year.
Also, every school hands out their own scholarships as well.
For example, my college awards scholarships for transfer students, students with high GPA’s, and more.
To find out which scholarships your school offers, type in your school following the word scholarships.
Ex: If you went to the University of Chicago, you would type in “University of Chicago scholarships.”
Don’t assume that your college is going to grant you these scholarships.
You need to apply for them.
I had a friend who didn’t apply for a scholarship they were 100% qualified for which could’ve saved them $3,000 per year.
2. Complete general education classes at Community College
Before enrolling in college, I decided to take my general education courses at a local community college.
My community college was charging $97 per credit hour, which saved me a ton of money compared to the average school charging $600 per credit hour.
I took the majority of my classes online, which also saved me time and money on transportation costs.
I was able to work a full-time job, which ultimately led me to pay off my car and build a solid emergency fund.
Before enrolling in community college, make sure your future college or university accepts courses from your community college.
Most colleges and universities offer a transfer scholarship which can range up to $5,000 per year depending on which school you are going to.
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3. Go to school with the end in mind
Often you’ll hear advice from people telling you to go to school even if you don’t know what to major in.
I mean, how are you supposed to know what you want to do with your life when you’re a junior or senior in high school?
If you have no idea what you want to do once you graduate high school, take a gap year.
In the United States, gap years aren’t common, but in Europe, gap years are quite traditional.
Malia (Obama’s daughter) was accepted to Harvard, but before she starts, she’s taking a gap year.
Harvard not only allows their students to take a break before enrolling in school, but they encourage it.
During a gap year, travel, volunteer, work various jobs, and spend time in several different career fields.
Tip: Even if you already know what you want to do, taking a gap year can give you time to reflect and gain life experiences. Instead of going straight to college, teach English abroad for a year. Launch a blog and get experience working online. Walk dogs in your free time. Become a Certified Personal Trainer, and either offer your services online or in person. I did all 4! (Taught English as an au pair).
4. Refinance student loans
Refinancing student loans with Credible can lower your interest rate, saving you thousands in interest and allowing you to make monthly payments that pay off your loans even faster.
When my boyfriend graduates, we are 100% refinancing his student loans, which will most likely save us thousands of dollars over the course of his loan.
Here are some of the options that may be available to you:
- Pay off loans faster
- Reduce your monthly payment
- Reduce interest charges and monthly payment
- Relieve your co-signer of their obligations
You can get started with Credible here. Sign up takes less than 5 minutes.
5. Live off campus
Living off campus means you aren’t living in a dorm, but instead with your parents or in a shared apartment.
Dorms are overpriced, cramped, and sharing a bathroom with tons of other people isn’t that cool.
Save some money and get a shared apartment with other students at your school.
Most schools should have information on shared rooms in complexes off campus.
Living off campus poses a ton of benefits (although living on campus has many benefits as well).
You also save thousands of dollars per year, while also getting your room.
6. Become a cook
Instead of signing up for a meal plan at your school (which is ridiculously overpriced by the way), learn how to cook your meals.
While shopping for your groceries, make sure to use Ibotta (you get $10 when you sign up, too!). Ibotta is a free app that is used by me and hundreds of FITnancials readers. I hate clipping coupons, but with Ibotta, all you have to do is log on to the app, find out which foods you want and click redeem, and then take a photo of the receipt through the Ibotta app. SO EASY.
Also, stop buying coffee at school or Starbucks for $5 every single day.
This will save you hundreds of dollars each semester, and you don’t even have to give up your coffee habit.
7. Only take out the amount you need
This is probably the most important tip on this list.
When you get your financial aid electronic award letter, you can customize how much money you need.
Instead of accepting the full amount, calculate how much you need every semester to pay off your classes and textbooks.
If you aren’t sure how much you need, set up an appointment with a financial aid counselor at your school.
It may sound tempting to accept the full amount and spend the extra money on shopping or travel, but this will end up biting you in the butt once you graduate.
Interest fees on student loans are no joke, and you don’t want to be drowning in student loan debt once you graduate.
Bonus: If you’re a parent
CollegeBacker is a 529 College Savings Plan that makes it easy to start saving for your child’s future college education. The plan grows tax-free and can be withdrawn taxa-free – just like a retirement plan for college.
You can even claim a gifting page which allows friends and family to chip in as a birthday present instead of actual gifts (this is a bonus if you’re a minimalist!).
CollegeBacker stands out among others because they have fudicary standards – which means they put your best interest first and never take commissions. They don’t charge any fees and instead work for tips. As an added bonus of giving back, 1% of all tips are donated to low-income families acround the country.
In just 5 minutes you can sign up with CollegeBacker and start your child’s college fund. If you click here, you even get a $25 matching gift for your child’s college fund.
What to read next: How I Made $80,000 My Second Year Blogging Full-Time In College
How did you or do you save money on college costs?
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