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5 Clever Ways to Eliminate Student Loans

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5 Clever Ways to Eliminate Student Loans

You sign a piece of paper and suddenly you owe thousands of dollars. It’s a small price to pay, right? You’ll get a college degree and your future will be secure.

Sorry.

The average student takes out $30,000 in loans. Many students take out more, some well into the six-figure mark. And it takes most of them more than two decades to pay this money back.

Want to travel for a couple of years after graduation?

Too bad. You owe hundreds of dollars every month. You need a regular paycheck.

Always wanted to work in the arts or for a nonprofit?

You might need to find something else. You might be able to pay off your loan payments with those jobs, but how will you still have enough left over to pay for your rent and food?

When you have loans, you need to make sacrifices. You might take a job you don’t particularly like. You might move back in with your parents. You might even do both to help yourself get out of debt faster. And when you wake up every morning and don’t like where you live or what you are doing, you might start to wish you had done things differently. Any way you slice it, student loans will affect your life. They are a major burden, and frankly, it is an unnecessary one.

Whether you are a top student or a mediocre one and whether you come from a low-, middle-, or high-income family, you can avoid student loans.

Here are five ways to get you started:

1. Take a Working Gap Year

Chances are, if you are just finishing high school, you are still living at home with your parents. You aren’t paying for rent, and you aren’t paying for food, and for the most part, all of the money you earn is yours to keep.

This is a pretty unique situation. Most people in this country have to spend most if not all of their earnings just to live off of. At least right now, you don’t have to.

If you take the year off between high school and college, get a job, even a job that pays close to minimum wage at a local retail store or restaurant, you will be able to save a significant amount of money.

One year of working full-time can easily add up to $20,000 or $30,000. How would you feel if you were awarded a scholarship worth that amount?

You’d probably be ecstatic.

Taking a working gap year will allow you to save enough to pay for two years of college at many in-state universities and at the very least will put a significant dent in reducing your loans at other institutions.

2. Live Off-Campus

Living on-campus comes with all sorts of benefits. There likely won’t be another time in your life when you’ll have to chance to live in a building with hundreds of residents exactly your age. And dorm life between late night conversations, parties, and group study sessions can be a lot of fun.

But at an average of $10,000 per year and in some cases up to $15,000 including board, dorm life is not cheap.

If you go to college in an expensive city like New York City or Boston, living off-campus might not be much cheaper, but in many parts of the country, off-campus housing could save you up to $6,000 per year (or $24,000 by the end of college).

And if you have the opportunity to live with relatives and skip out on rent altogether, forgoing the on-campus experience could mean major savings of approximately $40,000 by graduation at the average school (and up to $60,000 at some of the most expensive ones).

3. Take an Internship

Earning any money over the summer can be helpful for reducing debt, but internships often provide more value than a traditional summer job.

When many people hear the word “internship,” they think unpaid work. But according to a 2006 survey, 84% of American college students reported having an internship during some point in college and 64% of those students said they were paid for their work.

Lots of internship programs will pay students stipends, often times more than what you would earn in a traditional summer job. And even if your dream company is unable to pay you directly during your internship, you may want to check with your college to see if they offer any grants or fellowships for students who want to get a non-paying summer internships.

A number of colleges have programs that will distribute funds to you to compensate you for your unpaid summer internship work. Sometimes these funds can be quite substantial allocating between $3,000 and $6,000 for a summer of full-time work.

4. Earn College Credits Before College

These days, most public high schools offer either AP classes, which are designed to be college-level courses. If you take the exam offered at the end of each AP course and get a score of 4 or 5 (and even 3 in some cases), you may be able to gain college credit once you matriculate in college.

Credits, in many cases, equal money.

If you take four AP courses, for example, you may be able to waive an entire semester of college work, saving you anywhere from $6,000 to $35,000 once you account for room, board, fees, and other expenses. With seven or eight AP courses, you may be able to graduate an entire year early, potentially saving you anywhere from $12,000 to $70,000.

If your high school did not offer AP classes, some colleges will also give you the opportunity to earn credit from IB courses or from credits earned at a local community college.

You also may want to consider taking a couple of the 33 exams offered through the College Board’s College-Level Examination Program, which allows students the opportunity to pass out of full college courses for just $77 per exam, potentially saving you hundreds or even thousands of dollars.

5. Study Abroad

Study abroad might seem appealing for reasons entirely unrelated to financial aid including the opportunity to visit a different country, experience a new culture, and learn a language. But some students find that study abroad is also an excellent opportunity to save money.

I saved over $10,000 in the one semester I studied abroad based on the study abroad policy at my school.

If your school allows you to pay for tuition directly to a foreign institution (which in most cases are less expensive than American colleges) or if living expenses are significantly lower in the country where you plan to study, you may be able to accrue significant cost savings while abroad.

Asking about how your college handles study abroad will help you figure out whether study abroad can help you reduce your overall college expense while providing you with many other benefits as well.

There are so many ways to save money for college, and while finding the method that works for you will take effort and planning, take heart in knowing that thousands of students from all sorts of backgrounds manage to graduate each year debt free. The time you spend carving your own path to a debt free education will be well worth it when you graduate with a diploma and the freedom to do whatever you want to do with the next stage of your life.

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Pallas Snider Ziporyn is the author of Graduate with Zero Debt and The International Student’s Guide to American Colleges. She is a college counselor, writer, and speaker specializing in college search and selection, financial aid, and admissions to elite colleges. She is a graduate of Harvard College and formerly worked at the Harvard College Undergraduate Admissions Office.

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