How to Hack College – 4 Ways to Graduate Debt Free
Today, I’m going to share 4 strategies I used to graduate with a bachelor’s degree debt-free.
Last week, I wrote a post on ways to pay off your student loans. This is part two of that post on how to avoid taking out loans in the first place.
There are many ways to graduate debt-free but these are strategies I used to obtain my undergraduate degree for free.
How to Graduate Debt Free
I graduated with a bachelor’s degree from the most expensive college in my state with zero debt. My cost of attendance ended up being close to $50,000. I didn’t have an athletic full-ride scholarship, help from parents or an employer.
I worked my way through college full time, between 40 – 50 hours a week with two jobs while taking at least 12 credits a semester.
This happened in 4 ways: The FAFSA and scholarships, community college, an IDA account (if you don’t know what that is google it and see if your state offers it), and my personal savings.
1. The FAFSA
Free Application For Federal Student Aid (FAFSA) is the official form used to request federal, state and school assistance in paying for college.
“The FAFSA asks questions to determine the student’s level of financial need and establish his or her expected family contribution, or the amount of money the student and parents are expected to pay out of pocket for the student’s college expenses.”
Based on your situation you could get up to $5,800 per year in grants. I qualified for the full amount of Pell Grants for the first few years because my mother was single with five kids.
Too many students don’t even complete the application because they don’t think they would qualify for anything and miss out on a ton of money!
Applications for the FAFSA open up on October first for the following academic year. For example, if you complete the FAFSA on October 1st, 2020, it will be for the 2021-2022 academic year.
The earlier you apply, the better your chances of receiving grants. Even if you don’t qualify for a grant, you may still qualify for a subsidized student loan.
At least complete the application!
Along with the FAFSA, I went a little crazy applying for scholarships.
I knew I couldn’t afford to pay for my entire bachelor’s degree with grants and the rest out of pocket, so I went crazy applying for scholarships.
I didn’t want to waste time so I made a small investment of $7.99 and ordered a book off of Amazon called “How to Write an Award-Winning Scholarship Essay.”
Because of this book, no joke, I received over $13,000 in scholarships.
It was the best $8 I’ve ever spent!
A 162,400% ROI!
If I didn’t apply what I learned in that book, I wouldn’t have graduated debt-free.
2. Community College
Most people think they have to attend their school of choice for four years to have a degree from that school.
You don’t.
I went to my local community college for the first few years and finished my general education for free. This was all because of the grants that I received from the government because my mom was single and I was claimed as a dependent on her taxes for those first two years of college.
This decision saved me over $24,000.
After completing my associate’s degree, I transferred to get my bachelor’s degree from the University of Utah which is the flagship university of my state.
3. An Individual Development Account (IDA)
An Individual Development Account (IDA) is an asset-building tool designed to enable low-income individuals and families to save a targeted amount. These funds are used for building assets in the form of homeownership, post-secondary education, and small business ownership.
Because my wife and I were newly married and I only worked half of the previous year because I was on a church service mission, we qualified to participate in the IDA. Over a two year period of saving money each month, I was able to use $4,500 towards college.
How it worked was, I had to save $62.50 per month into a designated savings account at Zions Bank for 24 months. These cash deposits had to be made every month at the physical branch. If I failed to save $62.50 one month, I would forgo any matching.
I religiously deposited that amount every month and after two years I had saved up $1,500 of my own money in the account. After that, the amount in the account was matched 3 to 1. So by the end, I had $6,000 to use toward college, a down payment on a house, or starting a business.
Most of it was used to pay for college and a little to start a new business.
I’m not sure if these are still being offered because things are always changing. However, stay on top of this if you think you or someone you know may qualify.
Where else are you going to get a 300% return on your savings?
4. Personal Savings and Hard Work
This one is often overlooked.
Most people think because a student is in college, they don’t have to work hard or worry about finances until after they graduate.
This is so backward!
The habits and work ethic you create in college will transfer over into the real world after college.
I’ve basically always had a full-time job and I’ve worked my classes around my work schedule. Not the other way around.
I was also smart with my money.
Related: Guide to Personal Finance for College Students: Finance Management Tools and Apps
Making money and covering my expenses in college was very important to me so I didn’t have to borrow student loans and I could still save money.
A good chunk of my bachelor’s degree was paid for with money that I earned while I was in college and during the summer.
If you’d like to learn a few of the things I did in college to earn income:
Read: The Ultimate Guide to Making Side Income
Getting good grades is obviously important and you shouldn’t let work interfere with that. For me, I didn’t mind being a B student if it meant graduating debt-free.
But if you’re trying to get into Harvard or MIT, you obviously have to weigh the pros and cons of working as an undergrad.
Final Thoughts on a Debt-Free Degree
Because of the FAFSA and scholarships, attending community college, saving in an IDA account, and working my butt off, I was able to graduate from the university of my choice.
I had to figure all these things out on my own in college and I’m so grateful that I did!
If graduating college debt free is one of your goals, or you’d like to help a child graduate debt-free, I hope these ideas will help you in your journey!
Can You Do It With a Master’s Degree?
Graduating with my bachelor’s degree was a huge accomplishment for me.
But now, I am starting a Master’s in Personal Financial Planning at Texas Tech in the fall. I may have a plan in place to not have to borrow loans.
I have taken a challenge upon myself to graduate debt-free with a master’s degree as well. It should cost me about $19,000.
I already have $9,000 secured in scholarships and $4,000 covered if I work for the university. That leaves me with $6,000 out of pocket. I plan to pay for that by working and I’ll wipe out any loans I may have from my savings.
Wish me luck!
