Seven Tips for Paying College Bills



College tuition costs have been increasing at a rate greater than most any other consumer item.

According to the College Board, the average tuition increase was 3.7% at private colleges and 2.9% at public schools for 2014-15. But over the last decade the increase has averaged 5%.

Fortunately for tuition payers, “the average discount – in the form of institutional grants and scholarships – for full-time freshmen topped 50% for the first time,” according to the Philadelphia Inquirer.

The primary drivers for the increasing discount percentage are:

  • Increasing competition among schools for students.
  • A lot of families can’t afford $30,000 to $40,000 for tuition.

The Inquirer also reports: “The average sticker price for tuition and fees rose an estimated 3.3%, to $38,301, while the average institutional grant for freshmen jumped 7.3%, preliminary figures show.”

If your son or daughter is beginning college this fall or has already started their four-year journey, here are some strategies you can use to help pay for college costs.

For most college freshmen and their families, according to Consumer Reports, they don’t “start thinking seriously about how they’re going to pay for college until they accept a school’s admission offer.” The publication outlines six tips for paying college bills:

School communications

First-year students need to check their email frequently. Sometimes, schools want you to verify financial-aid information, which requires additional paperwork. Schools usually send an email when a bill is due, with a link that shows the full statement. Students – now considered an adult – should also sign a waiver so parents can also get email communications about financial aid and billing statements.

Understand the bill

Unfortunately, bills don’t start and end with tuition. There’s also room and board and lots of different fees. Once you have that number you can subtract grants, scholarships. The difference is what you owe. If you are planning to take a loan, you’ll have to sign a master promissory note agreeing to repay it and also complete loan counseling, online or in person. There also may be charges that you don’t need, such as an expensive meal plan or more costly health insurance. Make sure you decline unnecessary fees.

Borrowing options

Federally backed loans have flexible repayment plans, deferment or loan-forgiveness options. Repayments also don’t begin until a student has been out of school for six months. Federal loans have a fixed rate, while some private loans are variable, so they can continue rising.

Borrowing process

It’s important to only borrow what you need. Federal loans are paid directly to the school to cover expenses. If there is anything left it will be sent to the student. It may be tempting to spend the money for other things, since there is no requirement that it be spent for school costs. Resist that temptation by making a college-cost budget and stick to it. If you do have money left over at the end of a semester, consider making loan payments. There aren’t any repayment penalties.

529 limitations

If you have a 529 account, that money can only be used for qualified college expenses like tuition, room and board, fees, books, supplies and computers.

Installment plan

Most schools offer interest-free payment plans so you don’t have to pay for a semester with one check. This can ease the burden over a number of months.

One additional idea

Most students can manage a 10- or 20-hour-a-week job. This is a good opportunity to improve their time-management skills, but to also give them the responsibility of paying for some specific items like books, all extra entertainment, clothes, etc. It’s probably the best way to eliminate those monthly calls home asking for money.


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