How to Pay for College Without Loans

Check Out Our Tips on How to Pay for College Without Loans.

Written by Jason

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Last updated Feb 11, 2023 | Published on Jan 15, 2023

Does paying for college without loans sound like a dream? But you may wonder… How? After all, everyone seems to take out loans to pay for college?

But what if you did not have to? What if you could carefully piece together how to pay for college without loans by doing exactly that — pay for college without loans — instead of just dreaming about it?

Let’s discuss reasons why you may want to pay for college without loans and the ways it can be done.

Reasons to Pay for College Without Loans

You are likely no stranger to the fact that college graduates (and those who did not graduate) have student loan debt. More than 45 million individuals owe a total of $1.6 trillion and the typical undergraduate student finishes school with nearly $25,000.00 in debt.

Always Avoid Student Loans and Debt

We will walk through a number of reasons you may not want to pay for college with student loans.

Reason 1: You will not make monthly payments.

Monthly payments on anything can significantly drain your ability to save, invest and more. Debt can become a huge problem if you “collect” too much of it. For example, if you have less than 36% of debt relative to your income, your debt load is considered affordable compared to your earnings. Between 36% to 42%, you may want to consider specific methods of paying it off. Debt load over 50% often signals high-risk debt. 

Between home loans, student loans, private loans, car loans and other types of debt, you could end up putting yourself in a difficult situation later on. Eliminating student loan debt can help keep one type of debt off the books and help set yourself up for success in the future.

Reason 2: Cosigners are off the hook. 

When you take on student loans, you have a choice between federal student loans and private student loans. Federal student loans come from the federal government and private student loans come from private lenders, such as a bank or credit union.

Private student loans almost always require students to have cosigners, or trusted individuals who promise to make payments if you stop making your student loan payments. If you fail to make your payments, both you and the cosigner will experience negative credit changes. 

Reason 3: You will not incur high-interest loans.

One of the downsides of obtaining a loan involves the interest. The interest is the price you pay for borrowing from a lender. Depending on the type of loan you choose, you may end up with a higher interest rate with one type of loan over another. For example, a private lender may charge a higher interest rate than a federal student loan, but not always. Interest can cost a lot of money over the long term. 

Always Know the Interest Rates with Your Student Loans - Federal and Private Loans

The average student loan borrower on a standard 10-year repayment plan will pay $5,994.07 in interest over 10 years. Why not avoid that altogether?

Reason 4: You will not have debt for years.

In addition to not having debt monthly, you will not have debt for years. Under the standard repayment plan for federal student loans, you make fixed payments for up to 10 years and between 10 and 30 years for consolidation loans. Why not say “no” to 10 years — or longer — of paying on federal or private student loans?

Reason 5: Universal forgiveness may not relieve you.

The Biden administration has proposed $10,000.00 in debt relief for student loan borrowers as long as they earn less than $125,000.00 a year or are in households earning less than $250,000.00. However, you may not want to bank on that option, particularly because it is a one-time option and currently blocked by federal courts. Who knows if it will actually pay off for those who currently qualify?

Ways to Pay for College Without Student Loans

Let’s look at a few ways to pay for college without student loans, including paying cash, filing the FAFSA, choosing an affordable college, applying for merit scholarships and/or private scholarships, earning college credit in high school, getting grants, installment payment plans sponsored by colleges, working, and paying a family member back. 

1. Pay cash for college.

You can pay cash for college in a number of different ways, including through the following: 

  • Parents’ or grandparents’ savings
  • 529 plan, Coverdell, or other educational savings accounts
  • Your own savings
  • Parents’ monthly income (many colleges offer a monthly payment plan option)
  • Your own monthly income from a summer job

529 Plans Will Help You Pay for College Without Loans

You can use a few of these methods as well. For example, maybe your parents and grandparents saved for college and you can also pull from your own savings to handle college costs. 

2. File the FAFSA for federal aid.

Filing the Free Application for Federal Student Aid (FAFSA) can help you get federal aid, including grants and scholarships — not just federal student loans.

Here are the main steps for filing the FAFSA: 

  1. Create an FSA ID. An FSA ID is your account username and password to file the FAFSA, which you quickly create here. You will need to make a FSA ID for both the student and a parent.  
  2. File the FAFSA. You can file the FAFSA online form prior to each school year. Fill out the student demographics section, which includes your name and date of birth. List the schools that will receive your FAFSA, answer dependency status questions (whether you are a dependent student or not), fill out the parent demographics section, provide financial information using the IRS data retrieval tool (DRT), which automatically retrieves your parents’ information from the IRS.
  3. Sign and submit the form. Finally, sign and submit the form using your FSA ID.

Filing the FAFSA may not seem like a huge priority, particularly if you do not think you will “get any money” due to your income or other reasons. However, it is a good idea to consider filing anyway because the schools you apply to might use your information to offer you certain scholarships from the institution.

3. Choose an affordable college.

This is a big one. Before we dive into meetings with our clients, we sit down with them and ask about their comfort level paying for college. We encourage families to take a look at paying for college based on numbers instead of rushing headlong into costs they will regret later.

Naturally, choosing a college from an affordability standpoint is a big deal to us, and we will work with you from start to finish to make sure you choose the right college for your financial situation. 

4. Apply for merit-based scholarships. 

What are merit-based scholarships? Merit-based scholarships are just what they sound like — scholarships based on merit. Scholarships are free money that you do not have to pay back. 

They are one of the best ways to collect free money based on your special achievements and typically come from the institution that you plan to attend. For example, you can earn academic, athletic, creative, and special-interest scholarships from your college. Private colleges and universities typically offer generous academic merit-based scholarships that may be worth thousands of dollars per year.

5. Apply for private scholarships. 

In addition to merit-based scholarships, you can also apply for private scholarships. Private scholarships typically come from a private organization, such as from the local Elks Club or private business in the community. One of our clients obtained a scholarship through their part-time job at Chick-fil-A and their Remarkable Futures Scholarship Program. The point is, local clubs, organizations, and businesses are great places to look for private scholarships. 

Many Private Businesses - such as Chick-fil-A - Provide Scholarships to Reduce Loan Debt

6. Earn college credit in high school.

AP courses offer a great way to earn college credit in high school. High school students can take college-level courses at their high school by taking the AP subject exam in subjects like English, U.S. history, computer science, chemistry and music theory. You can get college credit by taking the AP exams and achieving a certain score on each exam. There is a cost for each AP exam, though you can get fee reductions in certain situations. 

College Level Examination Program (CLEP) exams also allow you to build college-level knowledge of topics, though you must prepare for exams on your own. CLEP exams do have a cost and cover a wide variety of subjects, from literature to mathematics.

You can also consider dual enrollment, which means enrolling in college courses, particularly community college courses, in high school. Many high schools offer this option to help students gain college credit. Check with your high school for more information about dual enrollment credit options.

If your high school does not offer a way for you to earn college credit in school, consider taking college courses during the summer. It’s a great way to build some college course credit during a time when you may need something to do.

7. Get grants. 

As mentioned before, you can file the FAFSA and receive grants. But what exactly are grants? They are money you do not need to pay back and can come from a wide variety of sources, including the federal government, state government, a college, or a private nonprofit organization.

It is a good idea to check with the college you plan to attend about how you can qualify for grants. Many grants are need-based, so it is important to keep that in mind when you are asking about grants. You may not qualify if your family income reaches a certain level.

8. Installment payment plans.

One of the unknown ways of how to pay for college without loans is installment payment plans. A majority of colleges offer installment payment plans but many students are unaware of this option. If you would have a remaining balance after grants or other funding sources, you could make monthly payments over the course of the semester instead of taking out a loan. 

You should inquire with the financial aid office about this option and payment details.  Colleges throughout the country vary greatly in repayment options and deadlines to register. Check out the University of Maryland’s payment plan to understand this option further.

9. Work during college.

How much could you put toward your college education if you worked during college? For example, let’s say tuition, room, board, and fees will cost you $20,000.00 It may seem overwhelming to get a bill for $10,000.00 for the semester, but many colleges offer a payment plan, where you can break your bill up into even payments throughout the school year.

Figure Out How Many Hours You Need to Work to Avoid Taking Out Loans

So, let’s say the total cost is $20,000.00 ($10,000.00 per semester). (Note that this is a completely made-up figure for example purposes.)

$20,000.00/10 (with a 10-month payment plan) = $2,000.00 per month 

Do you think you can earn $2,000.00 per month through a job during college in order to pay your tuition? It is possible. You may want to put together a carefully crafted budget to determine how you might be able to pay for college as well as other expenses you might have. 

The point is, do not write off a job during college completely! It can make a huge dent in paying for college — more than you might think. Check out these work possibilities for ways to make money in college.

You can also consider getting work-study through the college you attend as long as they participate in the federal work-study program. However, note that you are limited in your earnings. For example, after filing the FAFSA, you may find that you only qualify to receive $3,000.00 in work-study. Keep in mind that you need to earn this money by getting a job on campus and being diligent to save money to pay for college. 

10. Offer to pay a family member back.

We mentioned earlier that individuals sometimes get cosigners to help them get private loans. What if you asked a family member for the money and arranged to pay them back when you graduated? Naturally, there would have to be some trust involved in this process and you would have to have careful documentation that shows what you will owe and when you will repay them. 

11. Put all the pieces together.

Here is the biggest takeaway: You can piece all these methods together. For example, you can combine paying cash for college, scholarships, working, and filing the FAFSA. Financial planning for college is exactly like a puzzle. Puzzle together the ways to pay for college without loans in a way that makes sense for your situation. Talk carefully with your parents about the best way to combine effort and make it possible to avoid loans.

Learn How to Get Money for College Without Loans

Now that you know a few more ways about how to pay for college without student loans, how will you prepare for this opportunity yourself?

Campus to Career Crossroads Can Help You Pay for College Without Loans

Explore your options, opportunities, and everything available to you before you make a final plan. Contact Campus to Career Crossroads to get help with the entire process, from beginning to end.


How do students afford college without financial aid?

Students and their families put together a plan to afford college in many different ways. Some pull from college savings accounts, stocks, family savings, and more. There is no one “right” way to pay for college, though it is important to watch out for your parents’ retirement savings. You can always take out loans for college but your parents cannot take out loans for retirement!

How do I pay for college with nothing?

If you do not have anything saved, do as much as you can with the FAFSA. You may also be surprised at how much you can pull from summer jobs, working during school, and from family kicking in money to pay for tuition. 

Is it possible to go to college without debt?

Yes, it is possible to go to college without debt. Many college students graduate without debt, and it is important to remember that despite what the media says about “the cost of college,” it is possible to go to college without debt. It may take some careful planning in some situations, but you can make it happen! Check out these additional tips on paying for college.

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