Some parents don’t start planning for how to pay for college costs until after their child is admitted. There are, nevertheless, a few options available to students and parents who did not plan ahead or need a little extra money at the last minute:
- File the Free Application for Federal Student Aid (FAFSA) immediately. Some state deadlines may have already passed, but students can still apply for federal student aid as late as the last day of classes or June 30 of the academic year in which the student will be enrolled, whichever comes first. Review the Edvisors Student Aid Secrets for advice on ways to increase student financial aid eligibility on the FAFSA. Ask the college financial aid administrator for a professional judgment review if the family’s ability to pay is affected by unusual circumstances.
- Search for scholarships using a free scholarship matching service, such as the Edvisors StudentScholarshipSearch, ASAP. Most scholarships have deadlines in the fall and spring, but there are a few with summer deadlines. Starting the scholarship search now also helps the student get a head start on getting free money for the next academic year.
- It may seem counterintuitive, but it is still worthwhile to save for college, even very late in the game. Every dollar saved is a dollar less borrowed. Also, 35 states (including the District of Columbia) offer a state income tax deduction or tax credit for contributions to the state’s 529 college savings plan. That’s like getting a discount on tuition. Some states restrict the income tax deduction to contributions net of distributions, requiring the parent to wait until after December 31 to take the distribution, but some states allow parents to take the distribution as soon as the day after the contribution.
- Take advantage of education tax benefits, such as the American Opportunity Tax Credit and the Student Loan Interest Deduction, which are claimed on the subsequent year’s federal income tax return.
- Consider financial aid associated with work. Students should look into student job opportunities on or near campus (ask the college financial aid office, student employment or campus career office if there are any work-study or other student jobs that have gone unfilled). Parents should ask their employer’s human resources office whether the employer offers employer tuition assistance to employees and their dependents. Volunteer through the AmeriCorps program to earn education awards to help pay for school and pay down student loan debt. Military student aid may also be available through Reserve Officer Training Corps (ROTC) scholarships.
- If the student’s first choice college is too expensive on a net price basis, consider asking to defer admission for a year and/or enrolling in a less expensive college. Living at home is one of several ways of cutting college costs. It is often difficult to avoid relying on student loans, but consider tuition installment plans as a way of avoiding long-term debt.
- Ask the student’s grandparents or other relatives for help. Grandparents like bragging about their grandchildren, and what better way than helping them graduate from a top college? Grandparents should make sure they help in ways that do not hurt the student’s eligibility for need-based financial aid. Options include giving money to the parents to pay the grandchild’s college bills and contributing to a parent-owned 529 college savings plan. Consider having relatives and friends sign up for college savings loyalty/rebate programs.