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Pay for College

There are only a few ways to pay for college unless you are lucky enough to have the means to pay for it outright. You can use savings, use current income from work, apply for scholarships, qualify for grants, or take out student loans. In many cases, you will use a combination of these options to pay for tuition, books, and living expenses while you attend college.

Saving for College

Parents - Your child’s college tuition is one of the biggest investments you will ever make. Instead of splurging on luxury items (boats, cars, rvs, pools, video games, etc) think ahead to the expense of college.

Traditional savings options include savings accounts, taxable investment accounts, annuities, and U.S. Savings Bonds. You may also save for college using 529 college savings programs, 529 prepaid tuition programs, and Coverdell education savings accounts.

Start Early, Start Small

Can you afford $50.00 a month? If you invest $50.00 a month over an 18 year period, by the time your child attends college you will have saved over $17,000.00 if your savings earns just 5.0% interest (compounded monthly). Now add birthday and Christmas money from grandparents and aunts and uncles and you could easily reach your savings goal. Remember that any amount can make a big difference. Plus, you may be able to save more later — for example, if your family income goes up.

To Learn More or Calculate Your College Savings Goal:

Saving for College

AZ Family College Savings Plan

Apply for Grants & Scholarships

Apply for scholarships and grants early. Check with your High School and/or College, community organizations, and foundations. Take advantage of free scholarship search engines and utilize state department of education websites. Focus on finding free money first, prior to taking out student loans.

To learn more about Grants & Scholarships click here. 

10 Steps to Apply for Financial Aid

1. Financial aid consists of grants, scholarships, loans, and work-study. You can only qualify for federal financial aid (From the U.S. Department of Education) by completing a Free Application for Federal Student Aid (FAFSA) at www.fafsa.ed.gov .  The FAFSA should be completed as soon after January 1st, of the year you intend to start school in the fall. For more information on the FAFSA, check out Applying for Financial Aid.

2. Once your FAFSA has been processed you will receive a Student Aid Report (SAR) either by mail or email. The information on the SAR is what you submitted on the FAFSA. If any changes or corrections need to be made, you will be required to submit those changes to the Department of Education by following the directions provided in the email or mail packet.

3. Schools you have been accepted to and who have received your FAFSA information will put together a financial aid package for you. The school will then notify you of your financial aid eligibility. You may be eligible for student loans, scholarships, grants, and federal work-study.

4. You will be required to accept or deny your financial aid package by the school’s deadline. If you accept Stafford or PLUS student loans as a part of your financial aid package, you will be required to complete a loan application or master promissory note (MPN).

5. Your lender (Department of Education) will process your application and request that your school certify your eligibility and enrollment. In addition, your school will set the disbursement dates for your loan.

6. Your financial aid eligibility is based on your enrollment status. If you drop to half-time enrollment, your financial aid will be adjusted.

7. Once your loan has been processed, your lender will send the disbursement to the school based on the schedule the school requested.

8. Your school will apply all scholarship, grant, and loan funds to tuition, fees, and other expenses. They will notify you when the remaining funds will be available for you.

9. If you have excess funds and do not need the total loan amount borrowed from your lender, you should return the loans funds immediately. By doing so, you will keep your student loan debt to a minimum and lessen the financial burden you must repay once you graduate from school.

10. If you need additional money for education related expenses you can apply for a private loan. Private loans are based on credit and carry a higher interest rate than federal student loans.

Student Loans

If you qualify for a federal student loan based on your FAFSA application, you will be required to complete a loan application or master promissory note at www.direct.ed.gov. This student loan, although called financial aid, must be repaid. To learn more about the federal student loans available click here.

It is important that you only take the minimum amount of student loan that you need to pay for college to keep your student loan debt to a minimum.

If you fail to complete the semester or drop-out of college, you still must pay back your student loans.

By making payments while you are in college, you can also reduce the amount of student loan debt that you will face upon graduation.

Help for Veterans

Financial aid programs specifically for Veterans and their dependents have been created to help pay for college.

These programs are complicated and eligibility varies based on a veteran's date of service and the years of service. The GI Bill is one of the largest programs and one of the main reasons many people enlist in the armed forces. For more information on veteran eligibility and various programs, we recommend the following sites:



All college students, veteran and other-wise, must still complete a Free Application For Federal Aid (FAFSA). An important thing to remember when completing the FAFSA (www.fafsa.ed.gov) is that Veterans benefits are not counted as income in most cases.

FinAid has an excellent list of resources and programs for veterans, dependents, and survivors - www.finaid.org/military/veterans


For help applying for financial aid (completing your FAFSA) click here.

If you plan on taking student loans, check out our calculators and information on managing your student loan repayment. It's important to realize how much debt you are taking on to pay for college and to manage that student loan debt responsibly.