by nursing pins
College students often have trouble finding the necessary funds to pay all their college expenses to get a degree. Many students will apply for a student loan, but there are alternatives which can help to get the degree without a high level of debt.
Education loans will help college students to pay their college expenses, and the interest rate is lower compared with other loans. There are different kinds of student loans, but with most of them, the loan does not have to be paid back until after graduation from college.
Here are some other strategies and saving plans which can help to prevent debt when pursuing your degree:
College students who want a career in the military have an excellent opportunity to get a degree without any costs. They can combine their military occupation with education and there is plenty of choice in degree programs. It is possible to study for engineering, nursing, accounting, teaching, computer programming, doctor, psychology, business administration etc. and you are even paid for this education.
Before you consider taking this step to get your degree while in the military you need to know you can’t leave service when you get your degree. You have to serve the military for a specified period of time before you can leave the military and choose a job in another company. They have paid you for the expenses to get your degree with the intention to get a job in the army and you have to do your part in return.
2. Roth IRA’s
Most people know Roth IRA’s as a great opportunity to save for your retirement but is also a good way to save for the college expenses of your children. This savings plan doesn’t offer tax deductions but you don’t pay taxes on the interest of your savings. It is possible to withdraw money from this account without a penalty before the age of retirement if you use this money for higher education of your children.
If you start saving in this account when your child is born you can save already a high amount by the time he/she reaches the age for going to college. You can withdraw the money you need for college savings and let the rest of your savings grow in this account until you reach the age of retirement
3. 529 accounts and Coverdell accounts
There are 2 other types of accounts created for the purpose of education savings: 529 accounts and Coverdell accounts which may be a better choice for the college savings of your children. If you withdraw money for college expenses from your Roth IRA account you will pay income taxes. You can avoid these taxes by opening a 529 or a Coverdell account. These accounts offer also tax free savings and may only be used for college expenses.
It might be a good idea to consider opening a 529 or Coverdell account but there are also some disadvantages. It may happen that your child decides not going to college; in this case you can name another beneficiary of this account (another child, qualified relative or yourself). In other circumstances and money is not used for college expenses you need to pay a penalty of 10 %. You also lose tax benefits which should have if you left this money in a Roth IRA.
4. Study grants and scholarships
Many countries offer parents grants which may help them to pay college expenses. Not everyone can get these grants because it is dependent on the income of the parents. If your income is not above a certain level you can enjoy study grants. There are many criteria and vary from country to country.
Another possibility is to apply for scholarships. You can compare scholarships with receiving an award. There are several sites online where you can search if there are scholarships available which meets your criteria and you often have to fill out an application and write an essay to get a chance to receive a scholarship.
5. A savings account
Education can be really expensive and if you want your children get their degree without the debt you can best start with opening a savings account as soon as possible. Probably an online savings account will offer you the best rates and it is maybe best to open such account which only will be used for your college expenses. It is best to set every month a fixed amount aside and deposit into your online savings account. You need to resist the temptation to make temporarily withdrawals for other purposes with the intention to pay this money back later.
6. A vacation job, a weekend job or a part time job
It may be possible you need more money to pay all your college expenses than you have in all savings accounts together and you can best avoid student loans if you can find opportunities to increase your savings. Many students will search a vacation job during the summer months and a weekend job to save for their education and get their degree without the debt. It is also possible to search for a part time job and earn some extra money while they are studying for their degree.
Parents will search the best options for their children to get their degree without the debt. They know college expenses can be really high and it is best so search the necessary information when their children are still young. The sooner they know the possibilities which are available in their country the sooner they can start searching the best saving plans for the education of their children.
Getting a degree without the debt is possible with efforts from as well parents as their children (college students). It is possible parents can’t offer all the financial needs but they can inform their children the risks of student loans and inform them about the advantages of a summer job or a part-time job to get their degree. Getting a degree without the debt is the path to success in the future.
Written by Erik