3 Ways to Graduate Debt Free

3 Ways to Graduate Debt Free

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Over the past ten years, the cost of a college education in America has gone up very year, resulting in a $1.2 trillion student loan debt. The average loan has doubled in the past 20 years   Hillary Clinton recently announced a proposed student loan reform as part of her campaign.  This “New College Compact” would make college tuition at public schools free of charge.

In the meantime, millions of young Americas are heading back to college this month, and they will have to shoulder more debt to earn their degrees. Here are three ways to graduate debt free:

Work while you are at college

The idea of working while others are having a great time at college might not seem very appealing, but take a long, hard look at the future. Working now will prevent years of struggling to get out from under the burden of your student loans.  The annual fees for a public college can be as low as $5,000 and as high as $14,000 in some states. Working 20 hours a week at minimum wage, you could earn more than $7000 in a year. Add a good summer job to that number, and you could afford to go any public school you choose. 

Working while you study has the added advantage of getting experience that will make your résumé all the more appealing when you graduate. Consider working in the field you plan to enter once you graduate, even if it is just as an office worker or temp.  It will give you valuable insight into the everyday operation of that career.

Scholarships and Grants

The best way to make the most of the available scholarships and grants is to start the process early. Some are merit-based, and that will require hard work during your high school years.  Others are based purely on financial need, but there is a limited pool of funds available so competition can be fierce. And even if you do get a scholarship, it may not pay for all your tuition and board. 

Saving for College

Here too, it’s wise to start as early as possible.  There are several tax-advantaged options available to families, including Section 529 plans, Coverdell Education Savings Accounts (ESAs), zero coupon municipal bonds, and Roth Individual Retirement Accounts (IRAs) [6]. Talk to your financial advisor about the best vehicle for your family’s needs.

Perhaps Clinton’s “New College Compact” will lessen the burden for students in the future, but at this stage, it’s still just an idea. Taking action now can prevent a lifetime of crippling student loan debt.


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To the extent that this material concerns tax matters, it is not intended or written to be used, and cannot be used, by a taxpayer for the purpose of avoiding penalties that may be imposed by law. Each taxpayer should seek independent advice from a tax professional based on his or her individual circumstances.

These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable-- we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.

David Lerner Associates does not provide tax or legal advice. The information presented here is not specific to any individual's personal circumstances. Member FINRA & SIPC.


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Founded in 1976, David Lerner Associates is a privately-held broker/dealer with headquarters in Syosset, New York and branch offices in Westport, CT; Boca Raton, FL; Teaneck and Princeton, NJ; and White Plains, NY. For more information contact David Lerner Associates Call 516-921-4200 Visit our website: www.davidlerner.com

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Jake Mendlinger
Account Manager
516.829.8374 X 232

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