10 Tips For Cash-Flowing College Without Incurring Debt

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Yikes, your high schooler is knocking on college’s door and what you have saved wouldn’t send them to clown school. Many parents — myself included — find themselves in this exact or similar position.

So, what to do? If you have little to no money saved for college, you may think your only choices are to burst your child’s college bubble or to sign on the dotted line for loans. Not so. If you are cash-flowing college and are committed to doing so without incurring debt, you have options.

Here are some tips you (we) can explore as we navigate these oh-so-scary waters.

1. Say Goodbye to Guilt

If you are like most parents, you are probably struggling with at least some guilt for not being able to withdraw your child’s tuition in full from their college fund that you started before their first birthday. I hear you.

The first thing I want to say to you is to let go of the guilt. I recognize this is easier said than done. Yes, if we could all go back in time, we would start saving for our children’s college education about a millisecond after they were conceived, but we are where we are now.

The best thing we can do is approach our current situation with wisdom, clarity, and a plan. Replace the guilt with action and move on.

2. Be Firm in Your Decision Not to Incur Debt

If you are committed not to incurring debt—either on your part or your child’s—then it is important to be 100% firm in that decision.

You will undoubtedly be tempted to walk down the Parent Plus path or to allow your child to participate in the latest student loan debt statistics ($37,172 for the average 2016 grad), and you will have plenty of opportunities to do so over the course of your child’s education.

But, if your family’s goal is that your child graduates debt-free, then make that a non-negotiable. When you are firm in that decision, your options are clearer, and all other decision-making will flow from the fact that you do not plan to borrow.

3. Be Open With Your Child About Where You Stand.

Again, if only we could go back in time… But since we can’t, your child needs to know what the current situation is.

As early as possible, discuss with your child whether or not you have money saved and how much. Let them know what your expectations of them are—whether it’s working while in school or applying for every scholarship for which they’re eligible.

The key is to have this conversation early in the game, ideally way before their senior year, and definitely before they have their heart set on one specific school.

Being open with your child will also serve as a teachable moment. Be transparent about the reasons you did not save for their college. Perhaps you’ve been paying off your own student loans or did not realize the importance of prioritizing saving. Discuss your regrets and your hopes for them when they become parents. There’s a lesson in this for them.

4. Choose a School You Can Afford

This sounds obvious, but it is worth stating. It is easy to be unrealistic about how far we can stretch our dollars. If you are cash-flowing college and are committed to not borrowing, then you need to choose a school with a tuition that works in your budget.

Most schools offer a payment plan (for a small fee), allowing you to split the cost of tuition for each semester over a few months. Be realistic about what you can pay. Look at what you have saved (if any) and how much wiggle room you have in your budget to dedicate towards school.

5. Crowdsource College

Grab yourself a slice of humble pie, give some to your kid, and think about asking family and friends to help support your child’s college education.

If your child has ever participated in a volunteer or missions trip and needed to raise money for it, then you are familiar with this idea. Have your child draft a letter to send to grandparents; aunts and uncles; close family friends, etc., providing a status update on what they’ve been up to, what their intended college goals are, and an invitation to contribute financially.

Your child should be sure to include what they are doing personally to contribute financially to their education as well as their commitment to graduate debt-free. Also, state that in lieu of future tangible birthday presents, Christmas, or graduation gifts, they would welcome a contribution to their cash college fund.

Yes, everyone is dealing with their own financial situation and may not be in a position to contribute. The worst that can happen is they say no.

6. Work, Work, Work

If your child does not already have a job, they should use whatever time is left between now and their freshman year, to work and save as much as possible.

While they are in school, while they are home on vacation, guess what they’re doing? WORKING! Your child’s grades or school-life will not suffer simply because they have a job. Set them up to succeed at managing both by helping them with their time-management skills, and encourage them to look at jobs that might be related to their major.

7. Pursue Scholarships

While your kid is in high school, be sure they apply to as many scholarships as possible. Besides national scholarships, there are scholarships on the state as well as the local level for which they may qualify.

Their school will have a list of local scholarships, but don’t limit yourselves to that list. Local banks, credit unions, supermarkets all offer scholarships. Don’t turn your nose at a scholarship because the dollar amount won’t cover a year of tuition. A few hundred here and a thousand there add up. Explore scholarships online or check out scholarship books from your local library.

Once in college, your student should also pursue scholarships that their school offers. Many people stop looking at scholarships after their freshman year, but schools—even community colleges—offer scholarships specifically for upperclassmen.

8. Explore All Your Options

Look at these options to leverage time and keep your total school costs low.

Gap Year

Consider delaying college by a year so your child can work full-time and sock away their earnings for school. The benefits of a gap year go way beyond monetary. Your child will undoubtedly mature during the year. And if they were “bored” because everyone else was at school, good. That will motivate them when it’s their time to go.

Community College for One or Two Years

Community colleges get a bad rap, but more and more students are turning to them, and as a result, many of schools are upping their game. Take a tour of the community colleges in your area; you may be pleasantly surprised. Choosing to go to one for the first two years and then transferring to a four-year school almost cuts your total cost of college in half.

Live at Home for One or Two Years

Another way to keep costs down is to have your child live at home for the first and second years of school. Of course, this is only an option if the school is nearby, but you will save money, and they will still get the campus experience when they go in their junior and senior years.

Become an RA

When your student is an upperclassman, becoming a resident assistant or advisor is a way to keep the school bill low. Most schools offer free room and board to RA’s.

9. Four, No More

Start a “Four, No More!” campaign in your home. Remember when you were touring colleges or reading the glossy books, and the schools touted not only their 4-year graduation rate but also their 6-year rate? There is a reason for that.

We all think our kids will graduate in four years, but many students do not, thus producing the term, “freshmore”. Let your child know your expectation of them is that they complete their undergrad degrees in four years (or less).

10. Other Things To Consider

As you’re looking at your options and figuring out your total costs, keep the following in mind.

It’s Not Just Tuition

Be sure you include spending money, transportation costs, books, etc., as you are weighing your options. These expenses are real and must be taken into consideration.

Look Beyond Year One

It’s easy to look at your child’s freshman year and devise a plan for that only. This will potentially set your kid up for disappointment if you learn later on that you don’t have the resources to go beyond that. Be sure to look at the total costs over four years.

Shave off a Semester or Two

Your student can help reduce the cost of college by graduating a semester early. During their breaks, encourage your child to take courses online or at your local community college.

Also, pursuing AP classes and early college experience classes while in high school will shave off some time as well.

Your Own Financial Goals

What other financial goals and priorities are you delaying or sacrificing as a result of cash-flowing college? Prioritizing college over your own retirement hurts you AND your kid later on if it means they will be responsible for you financially.

Be realistic about what cash-flowing college means to you in the long term.

I cannot stress enough how important it is to explore and be open to all your options. I was given the advice of having my high-schooler take a gap year before college and did not heed it. In hindsight, I wish I did.

Take some time to weigh all your options carefully and pursue not only what is best for your child but also what is best for you.  

I commend your commitment to having your child graduate from college debt-free. It goes against the grain of our culture, but since most students graduate with debt, and most Americans live paycheck-to-paycheck, following the crowd is not really what we’re going for here.

Even though you wish you had college tuition wrapped up and ready to hand over to your child, give yourself a pat on the back for what you have accomplished. You likely have created a lovely home environment, given them vacations and experiences, or at the very least, you have clothed them, fed them, and kept them alive. You are a GOOD parent.

Are you committed to cash-flowing college for your high schooler? What is your plan to accomplish that? I would love to hear from you in the comments.

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