Paying for College on a Shoestring Budget

By Sara Schapmann

If you’re like many other families in the United States, pushing your child out of the nest and into the semi-independent world of college life tugs at more than just the heartstrings—it brings with it the anxiety of paying the high price of higher education when money is already tight.

College tuition is at an all-time high and if history is any indication, the price will only continue to rise. According to the College Board, the average cost of attending a public college in 2010 rose by 7.9% to $7,605 a year, and private institution tuition and fees rose by 4.5 % up to $27, 293.

What Can Parents Paying for College on a Fixed Income Do?

News stories and blogs alike tout creative ways families pay for education, from spending hundreds of hours gathering and recycling cans to disco dancing on busy streets for spare change. While these efforts are commendable, the real trick to paying for college is staying informed on the multitude of funding opportunities available.

No matter how skinny your salary or slim your savings, options exist to help you make college a reality for your child. Find out if the five tips below could fit your family’s situation.

Financial Aid Programs

The first step is to determine the overall price tag for your child’s education, taking into account living expenses, books and recreation. The second step is to determine your expected family contribution (EFC).

With many financial aid programs, you are only expected to contribute what you can realistically spend without breaking the bank. This is called the EFC, and it is determined by the federal government or organization awarding the aid. Your EFC is based on your net worth using a formula that considers a number of factors. To get an idea of your potential EFC, visit

Take Advantage of Loans and Grants

One of the most traditional routes to paying for school is through financial aid in the form of loans or grants. Grants are gifts from the government or college that you don’t pay back, while loans are paid back in full with interest. Before you can qualify for any grants or loans, you must fill out and submit the Free Application For Federal Student Aid (FAFSA) at

Subsidized Stafford loans are typically easier on the wallet in the long run than unsubsidized Stafford loans or private loans. Subsidized Stafford loans have a low fixed-interest rate and are determined based on need. Additionally, you can defer payment of the loan and interest until after graduation. Visit to decipher the finer points of these types of loans. The Federal Pell Grant is the most common higher education grant and is based on your household income. Search for additional grants at

If you are still struggling to pay your EFC, there are “parent” loans available through Federal Parent Loan Programs (PLUS). Parents can obtain a loan to close the gap between the total cost of education and their child’s expected financial aid. Keep in mind that you are required to pay back any kind of loan with interest, so make sure to factor that into your future financial plans.

Scholarships: Not Just for Academic Scholars

That underwater basket-weaving class just might pay off. Even if your children are not necessarily straight A students, they could be competitive candidates for the millions of scholarships available.

Scholarships exist for everything from sports and theater to knitting wool and skateboarding. They are also available for individuals of varying races, religions and cultures. Visit to help in your search for scholarships. You should also visit potential colleges’ websites and contact your child’s high school guidance counselor or academic advisor for a list of local scholarships.

Building a Tuition Fund and Resume with Work Study

Most colleges and universities offer work study programs that allow students to work part time— based on financial need and class load—on campus or in the community. You might get some sighs and eye rolls from your child, but not only will work study help pay for school, it is a great way for your child to begin building a resume.

Along with the valuable experience gained, work study opportunities can help children become more well-rounded candidates in a competitive job market — helping lower the chances they’ll be flying “back to the nest” after graduation.

Stockpile Cheaper Credit Hours

Another way to obtain credits at a lower per-credit-hour cost is for your child to enroll in classes at a community college during his or her last year of high school. Community colleges are significantly more affordable than four-year colleges, and most universities allow students to transfer community college credits toward a degree. Encourage your child to enroll in Advanced Placement courses in high school as these classes usually count toward college credit hours as well.

Pay Yourself Back

The government offers a variety of tax credits, deductions and savings plans. When tax time rolls around, you could boost your return by a couple of thousand dollars or more if you are paying for college. Visit for updated information on current education credits and deductions.

The bottom line is that no matter what your financial circumstances, college is not out of reach for your kids. By knowing your options and planning wisely, you can help your children’s academic dreams come true without breaking the bank.

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