When faced with tuition, fees, textbooks and living expenses, many students hope that paying the money for college back in the future will be easier than finding it in the present. As a result, many students fall into debt.
With research, resourcefulness, and hard work, you can find ways to help pay for college. By choosing the right school and taking advantage of scholarships, grants, work-study programs, budgeting, and frugal living, you can make a significant difference in the amount of debt you’ll carry when you graduate.
Do you have to attend a four-year brick-and-mortar university? Consider attending two years at a community college or all four years at an online university. Tuition may be lower with both options and you can eliminate on-campus living expenses.
It used to be that college scholarships were awarded primarily on academic or athletic merit. Today, there are also scholarships connected to field of study, ethnic or racial designation, disability, religious affiliation, employers or professional organizations, veterans and military service, and more. Sites such as Scholarships.com, The College Board, and FastWeb match you with scholarship opportunities.
Scholarships and grants are similar—both are funds for education that apply toward your tuition and don’t have to be repaid—but scholarships tend to be based more on merit, while grants are based more on need. Grants can be offered by employers or private organizations, but most are awarded by colleges, states, and the federal government. So, how do you get started?
Many colleges and universities participate in the Federal Work Study Program, in which students earn money by working part-time for the university, a community organization, or a government-funded agency. The employer and the government split the cost of paying the student (who cannot be paid less than federal minimum wage). Students fill out the FAFSA as part of the application process, then work with the university’s financial aid office to find available work-study positions.
The problems happen when you aren’t honest with yourself about your expenses (no one wants to admit that a latte a day adds up to more than $120 a month) or when you have unforeseen expenses due to car trouble or medical care. The truth is, the latter happens to everyone from time to time, so if you can set aside even $25-$50 in a savings account each month, you’ll be better prepared.
Determine How Much You Earn Each Month. That includes take-home pay (not gross pay), plus any other regular source of income. Multiply your weekly take-home pay by 52 (weeks), then divide by 12 (months). And this is critical: If you receive large chunks of money once a semester, as with scholarships or grants, you must split that money into monthly allowances (after you’ve paid for tuition and books).
Calculate How Much You Spend Each Month. Be brutally honest. Keep receipts. Write down expenses. Account for cash you take out of the ATM. This category includes rent, utilities (including cable, Wi-Fi, and cell phones), car insurance, groceries, and gas, but it also needs to include the small things—those lattes, for instance, and snacks and pizza.
Settle Up With Yourself. This means you need to cut expenses until the total you’re spending is less than the total you earn. It will mean spending less money on entertainment, looking for generic labels at the grocery store, and curbing impulse buys when you’re shopping.
Split the Money Into Categories. It’s not enough to know that you earn $750 a month and have whittled your expenses down to that amount. You also need to know how much you plan to spend in each category, or you won’t know where the money went. Deduct fixed expenses from your monthly income and then divide the remainder into what you will spend on food, social events, gas, and so on. When you go over your spending limit in one category, be aware that means you’re borrowing from another.