College can be expensive, but don’t be discouraged if you can’t save enough to cover the entire cost.
How Do I Pay for College?
Compare the goal of paying for college to another major purchase – like buying a house. Most buyers can’t afford to pay cash. Instead, they make a down payment and borrow the rest. College is no different.
While you may want to save enough to pay for college, it might require a combination of savings, income, scholarships and student loans to get the job done.
According to Sallie Mae, here is how American families are paying for college:
Families spent $26,373 on college in AY 2020-21.
56% of families are making payments on student loans while in school, up from 46% in AY 2019-20
- Calculate your projected college savings amount and compare it to your goal.
- Set up an automatic transfer from your bank account that goes into college savings every month.
- Consider expanding your savings whenever you pay off a loan or credit card by sending that same payment to your college savings, instead.
- Instead of toys, encourage grandparents, family, and friends to contribute to a college savings account when they want to give a gift to your child.
- Research credit card reward programs that contribute to your college savings account.