Sure, ramen noodles and used books can help to minimize the debt you incur during your college years, but if you really want to slash the cost of that higher education degree you will need to do better than that.
Students with a frugal streak and a flair for creativity can cut the cost of college tuition by half or more — if they know where to look.
“To the extent you can minimize your college debt at the undergraduate level you should, which can set you up a little bit better for success,” said Karen McCarthy, director of policy analysis at the National Association of Student Financial Aid Administrators in Washington, D.C. “That is especially true if you plan to pursue a graduate degree. Sometimes students with very large undergraduate loans are shocked to find that there isn’t very much federal aid available at the graduate level, so it is best not to go into a lot of student debt.”
According to the College Board, tuition, fees and room and board for full-time in-state students averaged $19,548 at public four-year colleges and universities in 2015 and $43,921 at private nonprofit four-year colleges.1 (Calculator: How Much Do I Need to Save for College?)
But most students receive some form of financial aid, bringing the average net cost (sticker price minus grant aid and tax benefits) of tuition, fees and room and board down to $14,120 at public four-year institutions, and $26,400 at private nonprofits.2
A few well-played strategies can slash that college price tag further still.
Level Down A College
Your college cost cutting campaign will be most successful if you have what colleges want.
Solid students who take tough classes, get good grades and excel in athletics or extracurricular activities are likely to get more merit aid, also known as non-need-based aid, if they are willing to “level down.”
“‘A’ students look very good to schools that get mostly ‘B’ students,” said Francine Block, president of American College Admissions Consultants in Holland, Pennsylvania. “If you find that the top schools aren’t giving any merit money, look half a step down. These are still really good schools.”
High achieving students who opt for a less prestigious undergraduate school can often earn a degree for 50 percent less with the help of lower tuition fees and more generous scholarships and grants. The most sought after college students could even get a full ride, the Holy Grail of financial aid in which tuition is fully covered.
Added bonus? You have a better chance of graduating college with honors as a big fish in a smaller pond than you would if you attended a more selective school, which better positions you for success, said Block.
“You get to come out on top and when graduate schools look at your application you may have a higher grade point average than your peers at the elite private schools,” she said in an interview.
Still worried that a lower tier school may stymie your child’s potential? You need not be.
A 2014 study of college graduates by Gallup-Purdue University found that the type of institution they attended (public or private, small or large, selective or less selective) mattered less than what they experienced while in college – experiences that “strongly relate to great jobs and great lives.”
According to the study, just as many graduates of public colleges as those who graduated from not-for-profit colleges are engaged at work and thriving “in all areas of their well-being.”
Support and experiences in college, the study found, had more of a relationship to long-term outcomes, including opportunities to apply what they learned as an intern, active involvement in extracurricular activities and groups and work on projects that took a semester or more to complete.3
Choose a Zero Tuition School
If you really want to minimize your tuition fee, as in, not pay a dime, more than a dozen U.S. colleges offer free tuition. Really.
Generally, you will still incur the cost of room and board, along with books and incidentals, and you may be required to work during the academic year, as some schools offering a degree for free want their students to have some skin in the game.
Finaid.org, a free online financial aid resource, profiles each of the colleges offering zero tuition, including Alice Lloyd College in Pippa Passes, Kentucky; Cooper Union in New York City; and College of the Ozarks in Point Lookout, Missouri.
Many free-tuition schools, which include a mix of four-year and two-year programs, are small and located in rural parts of the country.
Some cater to a specific major, like the Webb Institute in Glen Cover, New York, which offers a double major in Naval Architecture and Marine Engineering, and the Curtis Institute of Music in Philadelphia, which offers only music degrees.
A few are also bible-based, like the St. Louis Christian College in Florissant, Missouri, and the Barclay College in Haviland, Kansas.
Finaid.org notes that some new colleges, particularly professional schools, also offer free tuition to the first year’s incoming class to generate publicity, which is worth investigating the year you apply for college. And for those with exceptional financial need, it reports, more than 70 colleges have implemented zero loans financial aid policies for low-income students.
College Study Abroad
The number of American students who study abroad before graduating from college has more than tripled in the last two decades, reaching a new high of more than 300,000 in 2013-14 academic year, the most recent year for which data are available, according to the Institute of International Education.4 But the vast majority spends only a semester or two abroad.
To save some serious cash, you might want to consider packing your bags for all four years, said Block.
Germany has famously abolished tuition fees for all higher education students, including those who hail from overseas, and some of the top schools in Great Britain are a relative bargain compared to their U.S.-based counterparts.
Undergraduate tuition at the University of Edinburgh in Scotland, for example, ranged from roughly $24,000 to $32,000 for international students in 2016-17, depending on the major selected, while Oxford University tuition ranges from $22,000 to $33,000. By comparison, domestic Ivy League Harvard University and the elite Stanford University, both charge roughly $45,000 per year.
Canadian colleges, including McGill University and Concordia University in Montreal, also offer annual tuition for far less than many top private U.S. schools, said Block.
“Going abroad can be a substantial savings for international students,” she said. “This coming fall I will have several students at the University of St. Andrews, which draws roughly one-third of their students from America.” (The prestigious Scottish school where Prince William and Princess Kate were introduced offers a joint degree with the College of William and Mary in Williamsburg, Virginia.)
She cautions, however, that students who select an international school are generally restricted to the major they chose when they were initially accepted. You cannot change your mind as easily as you can in U.S. colleges.
“You also want to look at the dark side, meaning what will happen in four years when you graduate,” Block said. “Where are the kids who go there getting jobs? Are they getting into American graduate schools? Are they getting internships back in the U.S.? I tell families you have to look at the outcome four years from now because if you can’t get work, it is not really a savings.”
Start at a Community College
You can also save a bundle by getting your first two years of college credits at a local community college and then transferring to a four-year institution, McCarthy said in an interview.
And many do. In the fall of 2014, the most recent year for which data are available, 42 percent of all undergraduate students in the U.S. were enrolled in community colleges, according to the College Board.
The average published price for an in-district, two-year public community college in 2015-16: $3,435. That is a total of $6,870 for two full years.5
And since many students who attend community college live at home, they do not incur the additional expense of room and board.
To fairly compare out-of-pocket costs, however, you will need to factor in the cost of transportation to get you to and from campus, including a car, train or bus.
The community college and transfer option, sometimes called the 2+2 plan, is a major money saver, but McCarthy cautions students to look before they leap.
“One warning I always provide with that option is that you want to make sure all the work you do at the community college will transfer to the four-year program,” she said. “A lot of community colleges have guaranteed transfer agreements with local four-year institutions which direct exactly which classes you need to take so you do not lose any of the credits.”
Check with your community college and the four-year school you are planning to research your options.
Pay in-state Tuition
There is also much to be gained by getting “in-state” tuition rates, but that does not necessarily mean you have to attend a school in your own state.
Several states have reciprocity programs in place that allow eligible non-residents to pay the equivalent of in-state tuition at their colleges and universities.
The New England Regional Student Program, for example, also called the Tuition Break program, enables residents of Connecticut, Maine, Massachusetts, New Hampshire, Vermont and Rhode Island to enroll in an out-of-state New England public college or university at a discount if they select a major that is not offered in their home state. The average annual tuition savings per full-time student: $7,000.
Similarly, the Southern Regional Education Board Academic Common Market provides tuition discounts for college students in 15 southern states who pursue degrees not offered by their in-state institutions, while the Midwest Student Exchange Program offers discounts of its own.
Many schools in the Western region also offer reciprocity to local undergraduate students, graduate students and those who pursue professional healthcare degrees.
Despite the rising cost of college tuition, it is still possible to earn a degree without driving yourself into debilitating debt.
As they explore their options for higher education, Block suggests students consider not just the price tag, but the setting. Will they feel comfortable living out of state, or overseas? Do they prefer a smaller, more intimate campus, or a large university feel? Does the college offer courses that will propel them on their career path, or position them for graduate school?
“Finding the right college really means finding the right fit for them,” said Block.
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1 College Board, Tuition and Fees and Room and Board over Time, 1975-76 to 2015-16, Selected Years
2 College Board, Table 7, Average Net Price over Time for Full-Time Students, By Sector, 2015-16
3 Gallup-Purdue University, “Gallup Purdue Index Inaugural Report,” May 6, 2014
4 Institute of International Education, Open Doors 2015
5 College Board, Trends in Community Colleges: Table 6, 2016
The information provided is not written or intended as specific tax or legal advice. MassMutual, its employees and representatives are not authorized to give tax or legal advice. You are encouraged to seek advice from your own tax or legal counsel.