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Student loans can make college accessible by helping you pay for education costs. But after college, you’ll still have the debt waiting for you. The average student loan balance is $29,719, according to data reported by U.S. News. Therefore, it’s a good idea to investigate alternate ways to pay for college.

The best way is to start saving for college tuition as early as possible. If you’re already enrolled in college and have little to no savings, you have other options besides relying only on student loans.

Here’s how to cover the cost of college without relying on student loans or financial aid:

How to pay for college without student loans

Student loans are helpful, but you’d probably prefer to avoid debt if possible. It’s worth exploring other options with the goal of having as little student loan debt as possible when you graduate. The greater your debt upon graduation, the more difficult it can be to secure financing for a house or even a car.

Here are some ways you can pay for college without student loans.

Save in advance

Depending on when you start saving, you might be able to cover most of the cost of college without relying on student loans. Here are a couple savings vehicles to look into:

  • 529 College Savings Plan: You can set up a 529 College savings plan, which is a tax-advantaged savings vehicle that you use for education costs. Every state has a version of a 529 plan, and you aren’t required to open one only in your state. These plans work like an investment account. The money you put in is typically invested in mutual funds and exchange-traded funds. The earnings you receive from your 529 investments aren’t taxed and you can set one up from the state that sponsors the plan or through a brokerage.
  • Coverdell Education Savings Account (ESA): A Coverdell Education Savings Account is another type of savings account you can use for education expenses. Like a 529 plan, the distributions you receive from an ESA aren’t taxed. If the distributions exceed your education costs, though, you could be taxed on the overage. You can open a Coverdell ESA account at any financial institution or brokerage.
Good to know: Although 529 and Coverdell plans are similar, the differences are in the details of each plan. You can choose the plan that best suits your needs.

Grants and scholarships

Scholarships and grants are available through multiple platforms. Many of them are considered gift aid, which doesn’t need to be repaid.

When searching for grants and scholarships you might qualify for, look at state and local opportunities. Start your search at the financial aid office of the school you plan to attend. You can also search for grants and scholarships at your local library and online. Both merit-based grants and scholarships are typically based on financial need.

Tip: The U.S. Department of Labor has a free search tool that you can use to find a scholarship for your needs.

Consider a community college

While a prestigious university might be appealing for a resume, a community college is a good place to start. You can often transfer college credits that you earn at a community college to a larger university.

Taking transferable courses from a community college allows you to pay significantly less for the first two years. You can then complete your degree at a larger university.

Take on a part-time job

A full course of classes is essentially a full-time job, so you should only consider a part-time job as long as it won’t interfere with your classes. If it does, and it takes you longer to graduate, you defeat the debt-saving aspect of working. But if you can find a part-time job and keep up with your college courses, the job can provide a useful source of income.

Many universities and colleges have on-campus positions, which could be convenient. The hours are likely to be flexible and designed with your course schedule in mind.

Federal work-study jobs are another option. This part-time-job program is sponsored by the federal government and is for students who need financial assistance to attend college. Work is typically civic- or job-related. Not all schools participate, so check with your school’s financial aid office to see if the program is available.

Learn More: How to Pay for College

Additional options to pay for college

Sometimes you can’t avoid taking out a student loan to fill gaps in your education costs. If that’s the case, here are available student loan options to consider:

  • Federal student loans: Federal student loans are available through the federal government. In addition to free federal aid, the information you provide on the Free Application for Federal Student Aid (FAFSA) can help you qualify for a federal student loan. After filling out this form, you could be offered grants, work-study jobs, and student loans. Once you graduate, you’ll need to pay back the loan.
  • Private student loans: Private student loans are available through financial institutions, like banks and credit unions. You can use a private student loan to pay for all your education and education-related expenses, such as tuition, room and board, fees, books, supplies, transportation, and a computer for school.

It’s best to shop around for the best terms and interest rates before taking out any sort of loan, whether it’s federal or private. With Credible, you can compare private student loan rates without affecting your credit.

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Keep Reading: Guide to Every Type of Student Loan Offered

About the author
Laura Agadoni
Laura Agadoni

Laura Agadoni, author of “New Home Journal: Record All the Repairs, Upgrades and Home Improvements During Your Years at…,” is a real estate writer, landlord, and REALTOR®.

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