Most 18-year-olds skipping merrily off to college have no idea of of the financial turmoil that awaits them after graduation — if they’re part of the one-third of enrollees lucky or dogged enough to get their degree.
Federal student loan debt rose to over $1 trillion in 2012, and the government compassionate enough to lend young kids all of that money dispatches debt collectors from 32 different agencies to keep them paying off the interest on time each month. Can’t afford the monthly payment? That’s a shame. If you stop paying on your loans, the interest is capitalized, dragging you deeper in the hole. (RELATED: Federal loan sharks prey on cancer patients filing for bankruptcy)
If you plan to attend college full time, take steps to secure your financial future. Don’t wake up with a hangover and a pile of bills on graduation day — use this list to reduce the amount you borrow for a degree you almost certainly can’t afford.
SCHOLARSHIPS: Tens of thousands of dollars go unclaimed each year — grab some of the free money floating past you and pay off a semester a grant at a time. Let your mentors know which scholarships you will apply for and when ahead of time so they have plenty of time to send in recommendation letters. Begin searching for opportunities in January, when most new applications go online; make an agenda with deadlines and send in your materials as soon as possible. Call local businesses and ask if they sponsor promising students headed to college. Check the sites of major corporations, too. Coca Cola gave out $3 million to 250 high school seniors every year since 1989, which adds up to a decent $12,000 per kid. Your parents’ employers may also offer scholarship opportunities. If you’re an athlete, search for the college recruiting service that best fits your plan. Conduct your searches on a yearly cycle, and rake in the cash while you still can. Write a poem, win 15 grand — easy money.
FELLOWSHIPS: Before you knock off a few thousand off your bill with miscellaneous scholarships, look for the big money. Many organizations will funnel you a steady stream of dollars by providing grants for students excelling in certain fields of study, and may guarantee post-grad employment if you meet their standards. A fellowship in the humanities is especially valuable, considering that salaries for its corresponding jobs tend to be lower than STEM-related occupations. Looking to use your political science degree to further a free society? Apply for George Mason’s Institute for Humane Studies Humane Fellowship, a non-residential program that pays up to $15,000 per year while initiating you into a professional networks of scholars. You can also take advantage of big government by taking its money: The State Department will pay up to $40,000 per year for students enrolling in the Thomas R. Pickering Foreign Affairs Fellowship. Look for institutions dedicated to specific causes willing to stick with you for all four years. Add in tuition discounts from your college for academic excellence, and consider a fellowship a double coupon.
STANDARDIZED TESTS: Now, consider shortening your stay on campus. Get your core class requirements out of the way by taking a battery of Advanced Placement tests before you enroll. Why waste months languishing in Calc 1 when you can take an AP exam your senior year and earn credit for it before setting foot on campus? Front the money for as many tests as you can — they cost $89 a pop, and The College Board may lower that to $45 for qualifying students — to save thousands on rehashed college classes and to begin taking the interesting, advanced courses right away. Consider taking CLEP tests as well to earn credits for what you already know, and to fill in gaps left by unavailable AP tests. CLEP test costs are comparable to AP tests. Use your high school graduation party windfall wisely to defer the cost.
COMMUNITY COLLEGE: Not ready to pony up tens of thousands of dollars right away? Receive the dreadfully slender envelope from the Ivy League school you (and your parents) dreamed about since junior year? Not a problem. The nation’s top schools’ acceptance rates hover around 10 percent, but the line into your dream school gets a lot shorter — by several thousand hopefuls — if you apply as a transfer student. Nearly half of all undergrads in 2013 enrolled in a community college, which cost, on average, 64 percent less than a four-year university. A public community college costs on average $3,130 per year, while a public university costs skyrockets to $8,660 on average — and those numbers don’t even account for the breathtakingly expensive private colleges, which can leave you $40k in the hole each passing year.
CHOOSE A THREE-YEAR PROGRAM: Tuition costs show no sign of decreasing, so why not shorten your stay on campus by a year and incur less debt? Many colleges looking to boost enrollment numbers offer three-year programs to attract students who might otherwise be deterred by cost. Get in, get out, save thousands, get a salaried job a year early. Although the federal government’s student loan programs encourage colleges to artificially inflate costs, some have adapted to the distorted market and allow students to take classes year-round. Besides, dirty basement parties with watered-down kegs of Bud Lite get old fast, especially when you’re a super senior. One ambitious American University freshman put it perfectly: “There’s so much that I want to do — I don’t have time to be spending years and years in college.” We couldn’t agree more, Isabella.
OVERLOAD CLASSES: If you’re a full-time student, consider your education your job. Putting in a 40-plus hour work week is nothing. Aim for 60 hours and stretch your limits by adding one (or two) more classes than you think you can easily handle each semester. Getting any remaining prerequisites out of the way and accomplish more in shorter amount of time while saving money — don’t rely on the college bureaucracy to set your pace. You will adopt expert time management skills that will serve you well for a lifetime. Take this guy’s advice and triage ruthlessly — not every class and assignment demands the same level of effort. As each semester comes to a close, you’ll find yourself closer to the finish line than most of your classmates.
(Full disclosure: The author worked as a IHS Journalism Programs intern in the summer of 2011.)