Get Smart in Paying for College

Rising tuition costs and interest rates are the biggest factors that contribute to students, even promising ones, dropping out from college. A quality education is worth a million dollars or even more, which is why you must start planning for college as early as possible. Last minute scrambles to secure a large amount of money at exorbitant interest rates only end up stressing you and your parents and increasing your loan burden. Here’s how you can afford to pay your way through college:

• Loans: If you want low interest rates and payments that are deferred to when you actually finish your degree, try your best to secure a federal loan. Both the Stafford and Perkins loans are good options, so read up on them to see if you qualify. If you are forced to borrow money from a private lender, lock in your interest rates for the duration of your degree and ask about flexible repayment options. Some loans allow you tax deductions when they’re used to finance your education.

• Accelerated degrees: If you’re smart enough and hardworking, you could take more classes and courses than required during each academic year and finish your degree faster than normal. Accelerated degree programs cost less than regular programs, so even if you’ve taken out a loan to fund college, you’d have less to pay back.

• Grades and SAT scores: Instead of aspiring to gain admission to colleges where you’re out of your league, apply to places where you’re among the top 25 percent. Look around for schools where your SAT scores are higher than the expected norm and you can bet your tuition fees come down considerably. Smaller colleges looking to raise their profile with performing students are willing to reduce their rates or offer you a scholarship if you fit their bill of the perfect freshman.

• Savings: The best kinds are those that are tax free, like the 529 College Savings plan. Your parents can start one of these when you’re young and watch the money grow without having to pay taxes. This is a great way to both save for college and avoid paying taxes on your hard-earned money. You can transfer 529 plans to any of your kids depending on which ones want to go to college, so you don’t need to apply foresight before you start to save.

• Community programs: If all else fails and you’re unable to repay your student loans even after you earn your degree, the government offers you various options to pay back in kind – through service of some kind. You’re most likely to be asked to work in low income areas at lower salaries. These kinds of loan forgiveness programs are open to nurses, teachers, doctors, lawyers, Peace Corp volunteers, and others who qualify for public service careers. Check your options with The National Health Service Corps, The National Association of Public Interest Law, The Peace Corps, Americorps, and Volunteers in Service to America

This article is contributed by Sarah Scrafford, who regularly writes on the topic of top 10 on line universities. She invites your questions, comments and freelancing job inquiries at her email address: sarah.scrafford25@gmail.com.