Unless you have a hefty college fund, financing your college education may be your only option.

But don’t despair.

If you’d rather not drown in student debt, here are a few strategies to keep your loans to a minimum.

1. Stick to an in-state school or affordable out-of-state school

It is tempting to attend a big brand-name college with a stellar reputation, but you’ll often get more bang for your buck at an in-state public school or an affordable private college (yes, they exist): Nebraska Wesleyan, Birmingham Southern, and Hastings, for example.

Here’s a breakdown of the average cost of tuition by college type for the 2019–2020 academic year:

College Type Average Cost of Tuition
Community $3,730
In-state public $10,440
Out-of-state public $26,820
Private $36,880

Data Source: The College Board

As you can see, opting for an in-state public university over a pricey private one might save you roughly $99,000 on tuition over a four-year period. That’s strong motivation to become a smart college shopper by finding an affordable local or out-of-state school. Don’t settle for the first college that you’re interested in. Remember to apply to between 7-14 schools so that they can compete for your attendance with scholarships.

2. Avoid taking out private loans

Students whose college costs exceed the federal borrowing limits often take out private loans to make up the difference. We don’t recommend it.

For starters, interest rates on private loans are not capped. Private loans also don’t normally offer any sort of accommodations for people who struggle to keep up with their payments. Federal loans, conversely, offer a number of borrower protections like income-based repayment plans and deferment.

Instead, choose a college that the family can afford with the student borrowing at most $5,000 a year—or a total of $20,000 over four years. $20,000 can be paid off by age 31 for only $225 a month after college.

3. Graduate on time

Graduating on time means having a solid idea of your major, taking at least 15 credits a semester, and working hard. But you can start even earlier. Taking AP or IB credits in high school, doing summer school, and taking 18 or so credits a semester can get you that degree in less than four years, leaving you with less debt and a real income even sooner.

Avoid switching majors multiple times and extending your time in college unnecessarily. Adding a fifth year might extend your college experience, but it’ll add a large amount to your college debt, too.

4. Leave your car at home

Your savings from leaving the car at home can fund the premium you’ll incur from living in a dorm, frat, or sorority. Further, if you’re enjoying the benefits of on-campus living like community and proximity, you shouldn’t need a car. Then, once you’ve experienced the benefits of on-campus living, save even more by living at home. You’ll be thankful you did when your outstanding loan balance is thousands less than what your peers owe.

Using these strategies, you can keep costs under control and accomplish the goal of graduating with minimal debt. Be a smart college shopper and choose wisely. It will make a lasting difference.


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