Here are all of the avenues to consider before taking out student loans.

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If you’re considering covering your tuition costs by taking out student loans, consider all the other options first, even if you already have some money saved.

Some people think their savings are enough to keep them out of debt, but parents are wildly underestimating the cost of college — by $110,000, a Fidelity study says. [1] When they’re blindsided by tuition costs, odds are, parents will resort to student loans.

Here are some smarter ways of paying for school, before taking the last resort.

1. Apply for scholarships

Applying for every scholarship you’re eligible for could reduce how much you need to pay for school out of pocket, or with loans.

A study from Sallie Mae says scholarships cover an average of 28 percent of tuition costs, previously reported. But if you’re relying on loans to cover the remaining 72 percent, you might want to think about applying for more.

And don’t just look to big-name scholarships that thousands of people apply to. You should also try for scholarships offering less money, as you may have a better chance of winning.

Scholarship Owl lists some less popular $500 scholarships to apply for here.[2]

2. Go to a low-cost school

While some students take a gap year to save up for school, you may want to avoid a four-year college at first.

Going to a two-year community college will not only save you money while getting your Associate’s degree, but you can also go to a bigger, more expensive college afterward to finish your Bachelor’s while paying a fraction of the cost.

Other small colleges don’t even charge tuition to students. If you live in Kentucky, Ohio, Tennessee, Virginia or West Virginia, you may qualify for Alice Lloyd College’s free tuition program.[3]

U.S. News and World Report also lists some tuition-free colleges, but some make you earn your keep with jobs around campus. [4] Others only offer one course of study.

Read More: College Financial Planning

3. Get federal student aid

Millions of high school graduates left $2.3 billion in federal financial aid behind when they entered college this year. It means they were more likely to shop around for student loans, only growing the $1.5 trillion student loan debt our country is drowning in.

You get federal financial aid (grants, scholarships, and loan offers) by filling out the Free Application for Federal Student Aid, or the FAFSA. Many students don’t fill it out because they find the process difficult and time-consuming.

If they put these tips to use, and put in a little extra time to fill out the FAFSA, they could’ve gotten $3,583 each to go toward their education.

Find Out: How to Apply for Student Loans

4. Get a part-time job

Along with scholarships, aid, and your savings, if you don’t have to rely on loans to cover the rest, don’t. Get a part-time job instead.

If you’re already covering your tuition with the money you’ve already come up with, pay for your dorm or apartment fees working part-time, or with a side hustle, or both. has a list of lucrative side hustles you can try.

If a part-time job doesn’t fit your school schedule, some of these side-hustles can be done in your free time.

The best option for a part-time job would be a paid internship, but these are harder to find. If you can get one, however, you’re looking at extra money and a line on your resume.

5. Do a work-study program

Another option for working to pay for college is a work-study program. These are jobs on or near campus, and they’re based on financial need. You can get one by filling out the FAFSA.

You’ll usually earn minimum wage, and the total amount you can earn will be listed in your financial aid offer. The Department of Education says they try to place students with jobs in their course of study whenever possible, but you may also work for a non-profit or public agency “in the public interest.”

Find Out: 16 Easy Ways to Lower College Costs at Any Age or Life Stage

6. Make your work pay for college

If you work at Starbucks, Publix, or Wells Fargo, you’re in luck. These companies, along with a few others, will help you pay for your tuition.

Working 20 hours a week at Starbucks makes you eligible for The Starbucks College Achievement Plan.[5]

If you’ve worked at Publix for six months and on average 10 hours a week, they may reimburse your tuition by a maximum of $12,800.[6]

Wells Fargo will reimburse team members’ tuition by up to $5,000 annually. Their kids can also apply for scholarships ranging from $1,000 to $3,000.

Check to see if your company will reimburse or pay for your tuition.

Read More: Managing Student Loans While You Attend School

7. Sign up for an income share agreement

A growing alternative to student debt is the income-share agreement.

Unlike traditional loans with a balance that must be paid in full, an income-share agreement requires a student to pay back a portion of their income for a period of time.

The idea behind an income-share agreement is that graduates are protected if they struggle to find a job.  An income-share agreement should also encourage schools and lenders to help the borrowers find a job with a good salary.

Because income-share agreements are used far less often than student loans, borrowers should be careful to understand the advantages and disadvantages of an income-share plan.

Additionally, borrowers should carefully read the terms of their income-share agreement.  With the right terms the agreement can be a great idea.  If the terms are too friendly to the lender, the student may regret the income-share option.

And if you’ve already considered all of these ways to pay for college, but still need more money, take out a loan. Visit’s page for Student Loan FAQs to learn everything you need to know before taking one out.

Michael Lux and Cameren Boatner contributed to this report.

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About the Author

Ryan Lynch

Ryan Lynch

Ryan Lynch is a reporter for the Orlando Business Journal. He is a graduate of Florida Atlantic University with a bachelor's degree in journalism. He was the two-time editor in chief of the student-run newspaper.

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