How To Save For College (Options, Tips, and More!) in 2022

How To Save For College

Welcome to this post about how to save for college!

It’s currently my senior year of high school, which means that it’s crunch time. This year I need to pick a college, apply for financial aid, and move out! It’s overwhelming if I’m being honest. There’s a lot to think about, especially when I have a goal to walk out of college debt free.

I’ve had this goal for awhile now, and I have put a lot of thought and research into how one might actually achieve a debt free degree. That’s what I hope to share here today.

Now, I’m certainly not claiming to be an expert. Like I said, I’m in my senior year of high school. I haven’t even been to college yet so some may think I’m not qualified to talk about this. You might be right, but I have learned a lot from other people who have graduated debt free, and that’s what I am going to share today.

The first part of this post will be some general tips about college and for how to save for college, and then the second part of the post will be a step by step guide for things that you can be doing each year until you graduate to avoid student debt.

Nonetheless, let’s get into it! Here is how to save for college!

College 4 Year Degree

Before we dive too deep into saving for college, we should talk a little about college and the options you have for college.

Most people go to college and get a 4 year degree, which is called a bachelor’s degree. It’s called a 4 year degree because it generally takes 4 years of full-time study to get one. However, the time frame can be shorter or longer depending on your course load.

If you don’t want a 4 year degree, you could also get a 2 year degree called a associate’s degree. This isn’t quite as prestigious as a bachelor’s degree, however it is still better than having no degree at all. You can go to a community college which is MUCH cheaper and get a 2 year degree.

If you want to go above a 4 year degree, you can get a master’s degree which take about 2 years in addition to the first 4 years for a total of 6 years.

Or, you could get a doctorate, which takes anywhere from 4-8 years in addition to the first 4 years, for a total of 8-12 years.

College vs. High School

If you’re wondering about the differences between college and high school, this section is for you. If not, skip to the next section.

First off, college is much more expensive than high school. You’re going from an involuntary free education to a voluntary paid education.

The course load and the course work will get a lot harder, as to be expected. Many students do just fine in high school, but struggle academically when they reach college.

Finally, college offers a lot more independence than high school. Most students don’t live with their parents anymore. This means you can stay up as late as you want and do whatever you want. Also, no one is forcing you to go to class or do your work. While this sounds awesome, you also need to have some level of self-disciple to do what you are at college to do, get an education.

College vs. Trade School

Trade schools are increasing in popularity and are a good alternative to college. Moreover, trade schools cost way less than college, take less time to complete, and sometimes offer higher paying jobs than college.

Trades are things like construction workers, plumbers, electricians, HVAC technicians, carpenter, mechanics, etc. Basically, the industrial jobs where you might have to get your hands dirty.

A college degree typically costs $127,000, however trade school only costs $33,000. Therefore, the chances of you walking out debt free are about 4x as good.

While college takes 4 years to complete, trade schools usually only take 2, which allow you to get in the work force much earlier.

Finally, the average pay for a trade school graduate is $42,000 per year, which is not that far off from a college graduate at $50,000 per year. The minor decrease in pay might be worth it considering the fact that you spend way less on the education and it takes you less time to complete.

How Much To Save For College

How To Save For College

First off, you need to identify how much you are going to try to save. Obviously, the more you save, the better. But, you need to be realistic here.

Find out how much your parents currently have saved for you if any. Then, think about how much you and your parents could contribute from now until college. Add these totals up and you should get a rough estimate for how much you will have saved for college.

I think a good number to shoot for is 25-50% of the overall cost of the college you are wanting to attend. Since the average cost of a public college in America is $10,000 per year or $40,000 in total, you would want to have $10,000-$20,000 saved before you went to college.

Now, if you have more than 25-50%, that’s great! You’re in a fantastic position to graduate debt free. If you have less than 25-50%, don’t worry, you can still graduate debt free. You’re going to have to work hard, but, it’s still possible!

Here’s more information on how much to save for college.

How To Save Money On College

As far as how to save money on college, there are three major things that I would suggest.

The first of which is picking an affordable college to begin with. If you win a ton in scholarships but pick an expensive college, you still may struggle to graduate debt free. Pick a college that is on the cheaper side of what you can afford and also pick a college that offers a lot of financial aid opportunities.

Speaking of scholarships, the next thing you want to do is apply for as many scholarships as you can! There are a lot of private scholarships that people offer. There are thousands of scholarships like this out there! Once you actually enroll in college, then you will be able to apply for scholarships from that particular college, which will take a large chunk of money off your bill. Apply for as many scholarships as you can! It doesn’t matter how big or small, they are all worth it.

Finally, I think a huge way to save money on college is to live with your parents while in college. Most often, room and board fees make up half of your overall college cost. So, by living with your parents and eating with them, you could cut your college costs in half! I know it’s not for everyone, but it is something to consider.

How To Save Money For College Students

How To Save For College

Assuming you have already followed the three tips given above, your overall college cost should be much lower now. However, there’s still more you can do to save money while in college.

First off, find a good living situation. If you aren’t living with your parents, then find a cheap place to live. Get some roommates, get an apartment, do whatever you have to do to reduce the cost of your living situation.

Next, save money on school supplies by recycling. Reuse your old notebooks, writing utensils, and other supplies. You can rent your textbooks instead of buying them which is much cheaper!

Finally, save money on food by eating a ton at the school buffet or by shopping the deals at a grocery store. Avoid fast food because it is very expensive in the long run.

Is College Tuition Tax Deductible?

Yes, there are many tax deductions and benefits available for college students!

First and foremost, a 529 plan is a tax-advantaged college savings account where your money can grow tax-free. You may invest post-tax money into the account and as long as you use the money for educational purposes, you can withdraw it tax-free.

There are tax credits that may be applied to your tax return that will reduce the amount you owe, or give you a refund if you owe nothing. These two credits are the American Opportunity Tax Credit and the Lifetime Learning Credit.

There is another deduction that allows eligible taxpayers to deduct up to $4,000 from their taxable income depending on their income. Currently, this is set to expire on December 31, 2020, which means that you may have missed your chance for this.

Finally, if you do walk out with student loans, the interest on those loans should be tax-deductible.

However, don’t take my word for this! I am not a legal advisor or a CTA. I’d recommend that you do some more research on the IRS website and talk to a professional!

College Savings Calculator

We wrote a post a couple months ago that included a calculator that will tell you how much you will have saved up for college by factoring in how much you currently have saved up, how much you are saving each year, and the rate of return on your college saving account.

I highly recommend that you check it out. Here is a link to the calculator to see how much you will have saved up for college.

How To Save For College – Step By Step Process

Now that we have got through the general tips, I want to go over the step by step process on how to save for college.

I’m going to assume that people of all different ages might be reading this. But, to make things less complicated, I will separate everyone into 5 major groups based on their age. These groups will be identified as phases because there is a certain order that you should do things based upon your age. The phases are as follows:

  • Phase 1 (1-12)
  • Phase 2 (13-16)
  • Phase 3 (17-18)
  • Phase 4 (19-22)
  • Phase 5 (23+)

I still recommend that you read each phase because there’s aspects of each that get carried on to the next phase as well.

Phase 1 (1-12)

If you’re in this phase and reading this post, great job! I seriously doubt that very many people below the age of 13 are actually planning for college. So, I’m very impressed if you are!

Unfortunately, there’s not much you can do right now to save for college. However, you could have a conversation with your parents to see whether or not they’re setting some money aside for your college fund. Before the age of 13, your parents will probably be the only ones contributing to your college fund, so there’s not much else you can do.

However, there’s one other thing that I would suggest, and that is working hard in school. You’re not in high school yet, but it’s never too early to start building studious habits that will carry you to success. In high school you have to make sure your GPA is as good as possible and that you do well on the SAT and ACT. The better your GPA and test scores, the more likely colleges are to accept you and the more scholarships you will win. So put in the work because it will pay off!

Action Steps

  • Talk to your parents about saving for college
  • Work hard in school

Phase 2 (13-16)

I assume that the majority of my audience is either in this phase or in phase 3. If you’re reading this and you are between the ages of 13-16, you’re in a great position.

Not only is it great that you are planning, but you also have several years ahead of you where you can earn money. You can get a job, start a business, or earn active income, but you can also invest your earnings in a college 529 plan where years of compound interest will accumulate.

First off, let’s talk about earning income. If you’re lucky enough to get a job before you’re 16, good for you! Use this to your advantage and save as much as you can. But, if you can’t get a job, start a business or a side hustle! Seriously, it will go a really long way!

Next up, set up a college 529 plan. A college 529 plan is an account where you can save and invest post-tax money where it will grow tax-free! When it comes time to withdraw the money, you can have all of it! There won’t be any taxes taken out as long as you use it for educational purposes. I highly recommend opening an account because you can have compound interest work for you and have a tax-advantaged investment account.

And of course, you should still be talking to your parents about saving for college and working hard in school.

Action Steps

  • Talk to your parents about saving for college
  • Work hard in school
  • Get a job or start a business
  • Open a 529 college saving account and start saving

Phase 3 (17-18)

If you’re in this phase, it is crunch time! There’s very little time left and there’s a lot to do.

First off, it’s time to start applying for as many scholarships as you can. Just use the internet to compile a huge list of scholarships that you hope to apply to. No matter how big or small, each scholarship is worth it and they all add up!

Next, you should be studying for the SAT and or ACT. These tests are coming up, and it’s imperative you do well. Study a lot for these tests and retake them plenty of times. Increasing your score by only a few points can save you thousands of dollars each year on merit based scholarships.

Finally, it’s time to pick a college! As we discussed earlier, pick a college that is affordable and offers a lot of financial aid. This is a huge opportunity to save money, so make a wise decision. Go on college visits to make sure that it seems like a good fit! Also, do plenty of research before you make your final decision.

Action Steps

  • Talk to your parents about saving for college
  • Work hard in school
  • Get a job or start a business
  • Open a 529 college saving account and start saving
  • Apply to as many scholarships as you can
  • Do well on the SAT and ACT
  • Do research and pick an affordable college

Phase 4 (19-22)

If you happen to be reading this as a college student, there’s still a lot you can do to save money and avoid student debt.

First off, be frugal. We are talked about how to save money for college students, so utilize those tips. If you don’t remember what they were: find an affordable living situation, recycle your school supplies, and save money on food whenever you can.

Next, make sure you get good grades to remain eligible for scholarships. Once you earn scholarships your freshman year, many of them should renew each year as long as you keep your grades up. Just make sure you aren’t slacking off once in college, and you’ll be good to go.

Finally, get a job and start to save money or pay off existing debt. I have a friend who currently is a junior and has no student debt because he has paid it all off already. You’d be surprised how much money you can earn while in college. If you use it wisely, you could get yourself out of debt before you even have to start making payments.

Action Steps

  • Be frugal and save money whenever you can
  • Get good grades to remain eligible for renewable scholarships
  • Get a job and save money or pay off existing debt

Phase 5 (23+)

If you are someone who has just graduated from college and find themselves in debt, don’t worry.

I recommend paying off your student debt as soon as you can before you have other debt. And before you have other responsibilities that may keep you from paying it off.

Action Steps

  • Pay off debt as soon as you can
  • Enjoy your degree and a long life of financial success


How Much To Save For College

You should try to save 25-50% of the total cost of your college education. Since the average cost is $40,000, you should save $10,000-$20,000.

How To Save Money On College

Pick an affordable college, apply to as many scholarships as possible, and live with your parents if you can.

How To Save Money For College Students

The best ways to save money as a college student is to recycle school supplies and avoid eating out.

Is College Tuition Tax Deductible?

Yes, there are many tax benefits available for college students including savings accounts, credits, and deductions.

College vs. High School

College is much more expensive and is harder academically, but offers more independence than high school.

College vs. Trade School

Trade schools cost around 4x less than college, take only 2 years to complete, and the pay is somewhat comparable to a college graduate.

The Takeaway

I hope you enjoyed this post and I hoped it helped you plan for how to save for college. Make sure you follow the action steps laid out in the second half of the post and you’ll do just fine. Be sure to check out the book: Student Loan Solution: 5 Steps to Take Control of your Student Loans and Financial Life (Financial Makeover, Save Money, How to Deal With Student Loans, Getting Financial Aid). more debt you can avoid, the better off you’re financial future will be after graduation.

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Disclaimer: We are not experts or certified financial advisers. Our advice for you based on what has worked and continues to work for us. If financial problems occur we are not responsible for them and advise that you speak to a professional. That being said, we believe wholeheartedly that the advice we give to you will help your financial situation greatly.

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