Before You Borrow

Now that you’ve compared your college award letters, do you still have a funding gap? How will you finance the remaining costs? Before you borrow, consider these strategies to lower your cost of attendance.

If, after reviewing your options, you decide to borrow for college, you’ll save on your overall cost of borrowing by making interest payments while in school.

Federal Direct Subsidized Loans do not accrue interest until after you graduate or leave college, however, you can save money on the capitalized interest of Federal Direct Unsubsidized Loans if you pay the interest while in school. Paying a little each month or quarter can go far to reduce your total loan costs.

  • Reduce Costs
  • Earn Money for College
  • Payment Plans
  • Tax Benefits
  • Reconsider Your Choice

Reduce Variable Costs

While some expenses are fixed, such as tuition and fees, you may be able to realize savings on other variable costs, such as room, board, textbooks, transportation and personal expenses.

Campus Housing Options:
Colleges usually offer a selection of housing options, depending on your class year. You can save money on residential living if you are willing to live in larger suites, rather than two-person suites, singles or campus apartments. Off-campus apartments are often available in the college community. Living off campus does not always mean a lower cost of living. Be aware of the additional costs of food, utilities and furniture.

Meal Plans:
Meals can be the third highest expense at college, after tuition and room charges. Many colleges offer a variety of plans based on how much food you might eat in a week. Rather than opt for the most expensive plan with the most meals, review your eating habits and select a plan that will give you the most value for your money. Many plans include “flex” money that can be used at different campus locations and a few local businesses. Check the terms of the flex options and find out if unused meal money can be refunded or rolled over to another academic term. After your first semester, you may want to reconsider meal plan options that may result in additional savings. Meal plan details are usually available on the dining and residence life pages of the college website.

The average college student spends more than $1,200 a year on books and supplies, so it’s important to comparison shop before purchasing textbooks. Colleges must provide book lists for courses in advance, so students heading to college will be able to find the best deal before the semester begins. Remember to save your receipts from rentals or purchases, since these are qualified college expenses that you can use toward federal and state tax savings. Strategies to save money on textbooks include:

  • Shopping early
  • Shopping online
  • Using electronic textbooks, when available
  • Renting textbooks from the bookstore or other source
  • Buying earlier versions of textbooks, if allowed
  • Buying Used
  • Using library copies

Transportation costs vary widely, depending on factors such as the distance between your college and home, whether you will commute or live on campus, and how often you plan to go home for breaks. When bringing a car to campus, you may have to pay registration and parking fees. Many campuses offer a free bus to locations on campus and in town. Rides from campus to your hometown can be shared with others and some campuses may offer discounted buses to central locations. If you are commuting, look for student discounts on public transportation.

Personal Expenses and Entertainment:
You should have a good idea of how much money you can set aside for entertainment each semester, before you arrive on campus. Your entertainment budget can go further when you explore on-campus entertainment, clubs and sporting events. Remember to carry your student ID card; many local businesses give discounts to college students. Skip the trendy school break vacations. Instead, volunteer for a worthy cause near home — it’s a great resume builder and personally rewarding, too.

Earn Money for College

Working on or off-campus during the academic year and working a summer job can go far to help keep your college expenses in check.

  • Federal Work-Study: The Federal Work-Study program (FWS) provides jobs for undergraduate and graduate students with financial need, allowing them to earn money to help pay their education expenses. Pay is based on the federal minimum wage, but may vary depending on the skill level required for the job. The money from FWS is earned for hours worked and is paid directly to the student. It is not shown as a credit on the college bill.
  • On or off-campus jobs: Your college campus may have many opportunities to work part-time. You could be a tour guide for the admissions office, a fundraiser for the alumni association, work at the campus center food court or dining hall, or be a day care assistant, if there is a day care center on campus. Most colleges are close to shopping centers and restaurants, where you can also look for part-time work.
  • Be a Resident Assistant (RA): Many RA’s get free room and board, and sometimes a private room, in exchange for creating activities in the residence halls, acting as a resource and working with others to solve problems. Plus, being an RA will provide you with a wealth of experiences that will help build your resume. Contact your campus residential life office for details and application information – apply early, as these positions get filled quickly.
  • Summer Jobs: While it’s tempting to take an extended break from academic studies, forward-thinking students use their summers to find part-time or seasonal work. Not only can summer work provide good income to pay for next semester's textbooks and other college expenses, you may have an opportunity to find a job in your field of study, adding experience to your resume. The New York State Department of Labor’s Youth Portal has information to help you get ready for interviews and find a job. New York City students can find a job at the Summer Youth Employment Program (SYEP). Students living in other areas can look at their local government website in order to learn more about possible youth employment programs.

Use College Payment Plans

Use College Tuition Payment Plans:
Most colleges offer monthly payment plans. They are usually spread over 10 months, aren’t credit based and don’t charge interest. There may be an application fee. Ask about any fees before using a tuition payment plan.

Tuition payment plans can be a reasonable alternative to loans if you can afford to pay tuition each month. You may be able to avoid borrowing at all, or at least borrow less, by using a monthly tuition plan. Find out more from your college.

Take Advantage of Higher Education Tax Benefits

Many students and parents overlook important higher education tax benefits. You or your parents may be eligible for federal and state tax credits or deductions. For example, the federal American Opportunity Tax Credit provides a tax credit of up to $2,500 per student to offset qualified higher education expenses, even if you don’t pay any income tax. New York State residents may qualify for either a refundable tax credit of up to $400 per student or deduction of up to $10,000 for each eligible student for qualified tuition expenses. Learn more.

Reconsider Your College Choice

If you find the additional cost left to pay or finance is too great to keep your estimated debt burden affordable, you may need to consider other college options.

  • Save money by attending a two-year community college and transfer to a four-year college later to complete your program of study. You can take many of the core requirements of your degree program during your first two years. Find out if your four-year college of choice has transfer agreements with local two-year colleges. Your community college advisor can help you plan a two-year course of study that will transfer to your selected 4-year college.
  • Consider choosing a local two or four-year college so you can live at home. Eliminating room and board expenses and commuting from home can save thousands of dollars from your overall costs.

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