Personal Finance

How to Pay For College Expenses

Paying for College: It All Starts in High School

Even if you, a sibling, a family member, a child, or a friend is only in high school, it’s never too early to start thinking about how to pay for college.  Given that the average tuition for a 4 year degree at a private school is now over $31k/year, it pays to plan ahead. Even for a public university, it’s now $9k.  If you’re really ambitious and can get into an Ivy League school, then get ready to pay more $60k/year. With that as the backdrop, let’s do our homework on figuring how to pay for college expenses.

Cut College Expenses by Taking AP Courses

As a high school freshman or sophomore, you can help your family, and yourself, pay for college expenses by enrolling in Advanced Placement (AP) courses. Most high schools offer some AP classes that are taught at the level of an intro college courses. AP subjects range from Calculus, English, History, Chemistry, Art, Biology, Economics, and many more.  By taking an AP class and passing an exam at the end of the school year (earning at least a 3 out of a 5), a student can be exempt from taking that introductory course in college.  Nowadays, it isn’t uncommon for a top high school student to graduate with numerous AP course credits, and in some cases, an entire year of college credits earned.  Do the math, if you’re attending a state university with moderate tuition of $15k, you’re saving that much and another $10-20k in room and board. Basically, you can graduate college a year early.  And if you save a year of cost at a private college, you’re looking at $50-70k in saved tuition and room and board expenses!

Earn a Scholarship

When students apply for college admission, they may qualify for scholarships that can save them thousands or tens of thousands of dollars. Most scholarships fall into these categories:

  • Merit – Based on GPA, SAT/ACT scores typically
  • Diversity – Based on ethnic, racial, gender, or geographic diversity. Sometimes, it can be based on heritage. Descendant of World War II veteran, for example.
  • Sports, Skills – The applicant has special skills, usually in athletics, music, art, or some other valued skill that a particular values.
  • Major / Career Choice – Often, specific departments in a university will have a number of scholarships for students focusing on a specific major. Sometimes, especially in the fields of social work and education, there are scholarships for students targeting careers in lower income areas.
  • Extracurricular / Community Involvement – Typically, these are offered to students with certain types of activity involvement.  It could be someone who sings in a church choir, volunteered at the local hospital, was a Boy Scout, etc.

Scholarship websites:  Several excellent scholarship search sites are,, Fastweb,,

Apply for Financial Aid

This seems obvious, but it’s important to complete the Free Application for Federal Student Aid (FAFSA) application in time and completely.  This is the basis for financial aid awards at university, so it’s very important.

Here’s the FASFA website:

Attend Junior or Community College

If attending the 4 year college of your dream is difficult for financial reasons, consider attending a local two-year community or city college to complete all your general education requirements and then transferring over.  For one junior college near my home, the total cost for a student comes out to about $7,000/year, assuming one lives at home with parents and there are no room and board costs. This amount includes $1,100 for tuition and fees, $1,700 for books and supplies, and about $4,500 for transportation and food.  If you add in $4,500 for room and board costs while living at parents, it’s still a reasonable, $11,500/year. At a state college, tuition alone is $3,300.  At the more prestigious University of California, tuition and fees add up to almost $15,000/year.

So if you attend a junior college for two years before transferring to a California State University or University of California, you can save $2,200/year or nearly $14,000/yr. And if you transfer to a private college where tuition is say $35,000 per year or more, you’ll save $34,000 or more each year. I have a cousin who completed her general education at a junior college before attending a private college. After graduation, she worked at a top investment bank and was earning $120,000/year (that was over 10 years ago).  Clearly, her decision to attend a junior college did not impact her career or income earning potential!  So, don’t scoff at the chance to attend a junior college to save some serious dough.

Here’s some general information on community colleges in general:

Online Education

Online education, in many cases, may not be the low cost alternative that attending a junior college presents. However, it allows students to obtain an education on a more flexible schedule. This is attractive if a student is working full time at a relatively attractive job while she still wants to obtain a college education. Below is a list of online programs that ranked well in their respective niches.

Join the ROTC / Armed Forces to Pay for College Expenses

For those who want to serve their country and get a free education at the same time, joining the ROTC or military is a great way to do it. In exchange for several years of military service or reserve duty, students obtain a free education via the GI Bill. With the Montgomery GI Bill, one can get up to $60k for college expenses.

Each of the military branches has its own types of programs, so it’s best to visit their websites to learn the specifics of each:

Earn Money During College

Jobs. During the school year and the summers in between, why not get a job, especially one in an industry that you may be interested in working full-time after graduation. My suggestion is to avoid to mindless fast food McBurger places. To the extent that you can work in a more “white-collar” or trade oriented jobs where you can acquire some valuable skills and experience while networking for references for future jobs post-graduation, that’d be even better.

As you approach your junior or senior year, try to get a job with a company that could be a full-time employer after graduation. If you’ve worked for a place for 1-2 years, they will likely have a much better understanding of your work ethic, skills, and personality, and assuming you performed well, you’re in a much better position to get a full-time offer from them than an untested candidate.

Tutoring. Yes, you can make spare change doing this, but I knew someone who charged over $100/hr. while still in college.  Even if you charge only $20/hr and puts in 5 hrs a week, that’s still good money for a very part time job that’s most likely tax-free.  For the same guy who made $100/hr during college, tutoring turned out to be more than a part-time job.  Years after graduating, he now tutors students of all ages with the SAT, GMAT, college courses, etc now earns over $300,000 a year from tutoring. He is very good at explaining difficult concepts and has built a great referral network with clients who don’t mind paying him top dollars.

Start a Website / App. Most young people are pretty savvy nowadays since they grew up with the internet and cellphones and many feel comfortable with technology. Michelle Phan, the Youtube make-up demonstrator and entrepreneur, started uploading loaded videos showing young girls how to apply make-up in 2007, and the rest, as they say, is history. Her videos have been viewed over 1 billion times, and she has partnered with Lancome and L’Oreal in recent years. Not bad for someone who had to borrow a computer from a local college library to create her first video!  If you’re good with tech, why not start a website or app to earn you extra money and develop skills for your career.

Be a Freelancer. With the part-time economy in full swing, why not be a freelancer on Fiverr and Odesk for side gigs that you can work on your own schedule. I’ve personally hired high school and college students to do small research projects and write articles, which have worked well.

Have Your Loan Forgiven 

For people who enter into certain types of professions like education and social work or work for a non-profit, there are programs that may forgive part or all of the loan. It works something like this: after college, you become a high school teacher and for each year of service completed, a portion of the loan (either a fixed amount like several thousand dollars or a certain %) is “forgiven” or repaid by the government or agency that is sponsoring this program. In some cases, if the school you attended closed for whatever reason, it’s possible that the loan will be forgiven as well.

Here are several articles for reference that can help you:



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