How to Pay for College Without Student Loan Debt

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Mark Kantrowitz

By Mark Kantrowitz

August 18, 2023

There are several steps you can take to try to avoid taking student loans to pay for college. Many of these require planning early, and some will require help from parents or other family members who have the means to set aside savings for your education from an early age.

How Much College Costs

The overall cost of college is going to vary pretty widely based on the type of school you go to, what degree you earn, and where you live. For example, getting a bachelor’s degree in North Dakota at a state school while living on campus is going to be more affordable than getting a master’s degree from Harvard and living off campus. 

The average annual tuition cost for a four-year public school, nationwide, last school year was almost $11,000 while the average out-of-state tuition was over $28,000. Multiply that by four years and you’re paying a pretty penny just for the tuition costs. That doesn’t include room and board, food, or books. 

The average student could be paying over $40,000 per year to go to an out-of-state school. That’s around $160,000 over the course of their degree if they graduate on time, which many students do not. That is big investment, and why so many people wonder how they can pay for college without being in debt. 

If you’re thinking about taking out student loans, consider using our loan calculator to determine the monthly loan payment and total payments on your student loans, based on the loan amount, interest rate, fees and repayment term.

10 Ways to Pay For College Without Loans

While you may have to take out student loans to cover a portion of your total college costs, there are ways to try to get through school without doing that, or at least reducing the total amount of loans you’ll need to take out, which lowers the total debt you’re going to repay later. Here are the best things you can do to try to graduate debt-free.

1. Choose a More Affordable College

This can mean an in-state public school, or even starting your first two years at a community college before transferring to a four-year university. Students who enroll at community colleges are less likely to graduate with student loans. More than half of the students at these colleges do not borrow to pay for their education and more than two-thirds graduate with less than $10,000 in student loan debt.

Taking dual enrollment classes while you are still in high school can also allow you to get an early start on earning college credits which can reduce the total cost of your four-year degree.

More than three-quarters of students who graduate with no debt enrolled at a college that charged less than $10,000 a year in tuition, according to data from the 2015-2016 National Postsecondary Student Aid Study (NPSAS:16). Another option is to enroll at a college with a generous no-loans financial aid policy.

2. Work While in School

You can get a job while you’re in school to help reduce the need to borrow money just for living expenses. Some colleges offer a work-study program that helps you work for the school and pay a portion of your owed tuition and fees. This can be a great way to lower your total obligation every year. 

Working also enables you to get work experience for when you graduate and start looking for a more permanent full-time job. It can be a win-win if you find a job that doesn’t interfere with your ability to study and perform well in your classes. 

3. Choose a College That Is Close to Home

Students who enroll at an in-state public college are less likely to graduate with student loans than students who go out-of-state for college. This is because state schools offer a significantly lower tuition rate to students who are residents of the state. This can lower your annual tuition and fees by $10,000 or even $20,000 every year.

There are additional savings to going to school close to home as well. You could choose to live at home while you attend college, which could save money on room and board, for example. Familiarity with the area can also lower the need or desire to spend unnecessarily for extracurricular activities. 

4. Consider a College Where Your Parents Attended or Where They Work

Many colleges offer discounted or free tuition to employees and their families. It can be a great way to earn a degree without having to pay the steep tuition costs that everyone else is paying. The great thing about this perk, also, is that you can’t lose it like you can a scholarship as long as your parent continues to work at the school. 

If your parent or sibling attended a specific school, you may be eligible for a legacy discount, too. That can help you not only get into the school but also help reduce the overall cost and in turn the need to take out student debt. 

5. Consider Majoring in a STEM Degree

Students who major in STEM, especially mathematics, are less likely to borrow to pay for college. Perhaps it’s because math majors know how to calculate the impact of compound interest and are warier in borrowing to pay for college. There are also grants and scholarships for those who are working hard to obtain one of these sought-after degrees.

6. Apply for as Many Scholarships as You Can

Students who win more scholarships, especially scholarships worth $25,000 or more, are less likely to borrow to pay for college and more than half graduate with no debt. The goal of many scholarship providers is to reduce the student’s work and debt burden. So, focus on free money first. This is one of the best ways to graduate without having to take out a large number of student loans.

Did you know that scholarships are taxable? Use our Scholarship Tax Calculator to figure out the taxable amount of your scholarships and calculate how much you’ll have to pay in taxes.

7. Find an Employer Who Will Pay Your Tuition

Students who benefit from employer-paid tuition assistance are also less likely to graduate with student loan debt. This would entail you getting a job right out of high school and working hard to put yourself in a position where your employer will pay for school. 

Keep in mind that if you go this route, there is typically an obligation on your part in exchange for the free tuition payments. Most of the time, you’ll be asked to work with the company in a specific capacity for a minimum amount of time after you graduate. 

See also: These Companies Will Help You Pay For College

8. Graduate on Time

Make sure you plan a pathway from matriculation to graduation. Consider how often each class is offered and any prerequisites. Make sure you take all the credits required each semester to allow you to graduate within four years. Your tuition and fees typically include more credits than you may be taking. 

Students who take less time to graduate are also less likely to graduate with student loan debt. This is because you won’t have the added costs of another semester or two of room and board costs and you won’t have to pay for unnecessary classes that don’t help you progress to graduation. 

9. Save for College as Early as Possible

Every dollar you save is a dollar less you’ll have to borrow. It is cheaper to save than to borrow. Money in college savings plans also gives you the flexibility to choose a more expensive college than you otherwise could afford.

If your parents, a grandparent or another relative have opened a 529 college savings plan for you, ask that any presents received from birthdays, holidays, and graduations to be made as a cash contribution to a 529 plan. Apply any unexpected money, such as winning a contest, a bonus at work, or refund, to your college savings account.

10. Fill out the FAFSA as Soon as Possible

The FAFSA can open the door to grants, which is free money you don’t have to pay back. You can also qualify for work-study, which could help reduce what you need to borrow. Both of these things are super competitive and the quicker you fill out your FAFSA, the more financial aid that may be available for you.

Be sure to fill out and submit the FAFSA as soon as it opens – usually October 1st – for the following school year. This is when you should log on and complete the FAFSA. Remember that you must fill it out annually as it is not a one-time activity. 

Check out our Complete Guide to the FAFSA and Financial Aid.

Stats About College Students and Debt

There has been a lot of research and analysis done on those who graduate with student debt and on those who don’t. Here are some interesting findings about graduates and student loans:

  • Students whose parents earn $100,000 or more a year are less likely to borrow to pay for college.
  • Students who need financial aid to pay for college are more likely to graduate with student loans, in part because most colleges use student loans to meet financial needs.
  • Since those who earn $90,000 per year or above are earning more than 87% of the rest of the U.S. population, there are other ways your parents could help you eliminate student loan debt without being wealthy.

  • Dependent students, Asian and Hispanic students, and male students are less likely to graduate with student loan debt.
  • More than 90% of international students graduate with no debt, in part because they are not eligible for student loans.

The Bottom Line

College is expensive and it is expected to get much more expensive over the next decade. Student loans, while helpful for many, can damage your finances long-term if you don’t do everything you can to take on a manageable amount of debt. From working and saving your earnings, to getting family members to contribute to a 529 plan, there are plenty of things you can do to lower your total student debt

Frequently Asked Questions (FAQs)

How do people pay for college with no money? 

Most people who don’t have any money end up taking out at least some student loans in order to go to school. However, you can use a variety of methods to pay for school without money such as scholarships, grants, and working while you’re in school. 

Can you pay off college without loans? 

Paying for college is hard but doable without taking out any student loan debt. You’ll likely need to work hard and be creative if you don’t have someone gifting you the money. You can do this by earning scholarships or applying for as many grants as you qualify for. Ultimately, it will take sacrifice and you may need to work while you attend school. 

Do student loans go away after 7 years?

No, student loans do not go away after seven years. In fact, federal student loans, which are the most affordable, are one of the few types of debt that doesn’t go away if you file for bankruptcy

A good place to start:

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