You are 22 years old. You have just spent the past four years paying tuition, room and board, books, food, utilities, transportation, etc. The worst part is that it is all getting more and more expensive beyond peoples’ expectations. Where does that leave you? In a mountain of debt upon graduation. For some of us that means letting our debt dictate a less than optimal career.

If you are a college student (or know a college student to pass this onto!), what is one area that you directly control? The amount of money you make. Why does that matter? Every dollar you make is one less dollar you will have to borrow!

One thing to remember, though, is that you shouldn’t write off expensive colleges because you fear debt:

” Not applying to schools with high sticker prices that offer significant financial aid could actually lead families to pay more for their children’s education, not less. With Harvard’s new pricing structure, a family making $100,000 will pay about $10,000 for total charges (tuition, room and board, and fees). This compares to the average charges at public four-year colleges and universities in 2008-09 of $14,333…”

Here are a few tried and true methods to slash the price of a college education.

1) Military Service

There are two Montgomery GI Bills:

• One for active duty, and
• One for reservists and guard.

The one for active duty military offers recruits the option of participating. Choosing to participate reduces their paycheck by a measly $100 per month for the first year. What do you get for this total of $1,200? A whopping $37,224 in education benefits if you are a 4 year enlistee. If you are a 2 year enlistee that number drops down to $30,240. Where else could you turn $1,200 into over $30,000? That is a pretty good ROI!

The Montgomery GI Bill for reservists and guards does not reduce your pay. However, you do forfeit a lot of the monetary benefits… you are only entitled to a total of $10,692. You also must be enlisted for a total of 6 years in order to qualify. Nonetheless, about $11,000 is a pretty good deal!

Another way to use the military to reduce your college costs is by going to a Military academy. They are tuition-free four-year colleges that offer a commission in the military as an officer after graduation.  What is a Military academy? West Point, the Air Force Academy, etc. The ROTC (Reserve Officer Training Corps) also provides scholarships for participation. These scholarships are merit based. If you look at the site you will see they also offer additional living expenses on top of tuition. A great deal if service to your country is something you want to do. If you have any questions you should contact your local military recruiter.

2) Part-time Work

This is the option I chose when I attended college. I worked about 20-30 hours per week every semester except for one. That’s not counting all of my other time commitments (15-18 credits per semester and was an officer in an academic society).

The first issue most people raise is that they do not want to negatively affect their grades. However, interestingly enough the only semester in which I did not work was the semester in which I got the worst grades! Why? Because I wasn’t utilizing proper time management practices that I needed in order to balance work, school, academic clubs, and a social life. Once I was forced to “budget” my time I found that all aspects in my life improved. And this is a life skill. Postponing learning this skill just makes it harder for yourself down the road.

My jobs entailed business management, sales, marketing, logistics, warehousing, and more. The pay for each job varied but were all pretty good. Some had benefits, some didn’t. Some did tuition reimbursement to sweeten the deal.

What did I get by doing all of this? When I graduated, on top of my scholarships, grants, and income from working… I was debt free. Worth it?

3) Co-op

Co-ops are offered by some college programs. Drexel is a well-known business school that has a 5 year program in order to incorporate between six and eighteen months of co-ops.

What is a co-op and why do some schools incorporate them? A co-op allows a student to work within a major corporation in the field they are interested in. The corporations typically are very willing to entrust projects to the students because they have them for a period of time and know that the student is working for a grade. If you want responsibility, a co-op is right for you.

The benefit is that a co-op allows students to apply their knowledge in the field. Upon graduation, practical experience may set you apart from your peers. A lot of companies (Unilever, Johnson and Johnson, etc) offer the students who have co-op’d with them a higher starting salary. At Drexel University, the average six month co-op salary is $13,760. Other co-op programs offer similar compensation. If you were to work at UPS (as I did for a year), you would earn $9,600 over the six months plus $4,000 in tuition reimbursement. So the amounts are right in line but the co-op offers the advantage of a better resume boost and a potential job offer!

4) Volunteer Programs

Have you heard of AmericCorps? AmeriCorps is an organization that links people with non-profit groups in order to make a difference in someone’s life. What kind of work would you find yourself doing?

• Tutor and mentor disadvantaged youth
• Fight illiteracy
• Improve health services
• Build affordable housing
• Teach computer skills
• Clean parks and streams
• Manage or operate after-school programs
• Help communities respond to disasters
• Build organizational capacity
• Benefits of Service

What reward do you get? Helping people! Oh… and a Segal AmeriCorps Education Award which totals $4,725. You can use it to pay for college, graduate school, or just to pay back qualified student loans. If you only serve the AmeriCorps part-time you will still receive a partial award!

Another way that the AmeriCorps helps to reimburse college loans is the Public Service Loan Forgiveness program and a new Income-Based Repayment plan (IBR) which stemmed from  The College Cost Reduction and Access Act of 2007. The IBR allows you to pay less money on your loans since you will be a low-income AmeriCorps member. Service is also viewed as an equivalent to a public service job which qualifies you for the Public Service Loan Forgiveness program! Oh, and while you are working for the AmeriCops to get these education benefits, you are also receiving a living allowance and health benefits.

5) Scholarships

Scholarships are a great way to save money. My academic society had a pretty large endowment to draw from to give out scholarships.

The real interesting thing, however, is that we had so few applicants that every applicant would receive something, with the minimum scholarship being $500. And it was just a 1 page form that took five minutes to fill out! That is $100 per minute… or $6,000 per hour!

You would be surprised how many scholarships get left on the table. There are a bunch of websites dedicated to helping you find scholarships, such as FastWeb and Scholarships.com (but be prepared to have a low success rate on those sites). You should try to take advantage of every possible scholarship. On top of asking academic societies if they offer scholarships and searching those sites, you should ask your high school guidance counselor or college advisor if they know of any scholarships that are available.

6) Community College

This is one option that I did not take advantage of, and I wish I would have at least considered it. Community colleges are cheaper by an extraordinary amount. You may wind up paying $5,000 for the year rather than what would be $20,000 at your state school or a private institution. You can take your first two years of classes which normally consist of basic requirements, or core classes, anyway. By doing this you may wind up saving a fortune. If I had done this when I was in college, I could have saved an extra $30,000 over the first two years of school – when accounting for tuition and room and board, since I would have lived home. I still would have graduated on time… just with a huge chunk of cash in my pocket! I certainly have a few things on my mind that I could have used that for!

7) Lifetime Learning Credit

When it comes time to do your taxes, The Lifetime Learning Credit provides an annual tax credit of up to $2,000 for qualified tuition and fees. This limit is on a per family basis. If you are a single filer the credit starts getting phased out at an adjusted gross income (AGI) of $50,000. For a married filing jointly filer the credit gets phased out starting at an AGI of $100,000.

Summary

There should be no reason you graduate in mountains of debt if you have the foresight to make a plan and stick to it. There are plenty of ways to chip away at the costs of college as I have outlined above. There are more but I thought these were some of the most sizable and substantial ways. Feel free to offer any suggestions that have a large impact, too!