How To Pay For a Bachelor's Degree: Cost & Financial Aid

Earning a bachelor's degree is a significant milestone in your educational and professional journey. However, tuition, room and board, textbooks, and other fees cause the price of a degree to be quite high.

Below, we'll explain how much everything costs and how you can use financial aid to pay for it without going into a lot of debt. Don't let high tuition costs stop you from earning the degree you need to be successful.

How Much Does a Bachelor's Degree Cost?

The cost of a bachelor's degree can vary widely based on several factors, including the type of institution (public vs. private), residency status (in-state vs. out-of-state), and the format of the degree (in-person vs. online). Below, we'll compare both in-person and online degrees' costs.

In-Person Bachelor's Degree Costs

Many students want to earn their bachelor's degree in person to experience college life and learn how to live on their own. However, they will have higher living expenses than if they earned an online degree while living at home.

Tuition and Fees

In-state students at public colleges and universities typically pay lower tuition, averaging around $11,260 per year. Out-of-state students, however, may face significantly higher costs, often exceeding $29,150 per year.

Private colleges and universities generally charge higher tuition, with annual costs averaging around $41,540 or more. Elite institutions may charge even higher rates.

Additional Expenses

When you attend college in person, you'll need to pay for more than just tuition.

• Room and board: On-campus housing and meal plans can add substantial costs, ranging from $12,000 to $13,000 per year, depending on the location and type of accommodations.
• Books and supplies: Students, on average, may spend an additional $300 to $600 annually on textbooks and course materials.
• Transportation and personal expenses: Costs for commuting, parking, and personal expenses can vary but may amount to several thousand dollars annually.

Online Bachelor's Degree Costs

If you're looking a save some money, opt for an online degree instead of an in-person one.

Tuition and Fees

Online programs often have lower tuition rates compared to in-person programs. The absence of physical infrastructure allows institutions to reduce costs, which can be passed on to students.

Some online programs charge a flat rate regardless of residency, while others may have different rates for in-state and out-of-state students.

Additional Lower Costs

Not only is tuition more affordable, so are a few more must-haves of attending college.

• Housing and commuting: Online students typically save on housing and commuting expenses since they can study from home.
• Books and supplies: Many online programs offer digital course materials, which can reduce the cost of textbooks.
• Technology requirements: Students may need to invest in a reliable computer and internet connection, but these costs are generally lower than those associated with in-person attendance.

How To Pay For a Bachelor's Degree

Now that you know the cost differences between in-person and online degrees, we'll explain how you can pay the least amount of money out of pocket for whichever degree you choose.

1. Federal Financial Aid

The Department of Education provides a substantial amount of financial aid to help students cover the costs of higher education. You first need to complete the Free Application for Federal Student Aid (FAFSA) form. This form determines eligibility for various types of aid based on financial need.

Grants

Grants do not need to be repaid, making them highly desirable. The Pell Grant is available to undergraduate students with significant financial need. The amount awarded depends on factors such as family income, the cost of attendance, and enrollment status.

The Federal Supplemental Educational Opportunity Grant (FSEOG) is for students with exceptional financial need, usually awarded with other types of aid.

Student Loans

Federal student loans are a common way to finance a bachelor's degree. They typically offer lower interest rates and more flexible repayment options than private loans. Key types include:

• Direct Subsidized Loans: for students with financial need, where the government pays the interest while the student is in school
• Direct Unsubsidized Loans: available to all students, with interest accruing from the time the loan is disbursed
• PLUS Loans: for parents of dependent undergraduate students, with the ability to borrow up to the full cost of attendance

Work-Study Program

Word-study programs provide part-time jobs for undergraduate students with financial need, allowing them to earn money to help pay education expenses. Work-study jobs can be on campus or off campus, often related to the student's field of study.

2. State Financial Aid

Many states offer financial aid programs for residents attending public in-state colleges and universities. These can include grants, scholarships, and work-study programs. The criteria for eligibility and application processes vary by state, so it's essential to check with your state's higher education agency for details.

3. Institutional Scholarships and Grants

Colleges and universities often provide their own scholarships and grants to attract and support students. These awards can be based on academic achievement, athletic ability, artistic talent, or financial need.

Merit-Based Scholarships

Merit-based scholarships are awarded based on academic or other achievements. Many institutions offer scholarships for students with high GPAs, strong standardized test scores, or notable extracurricular accomplishments.

Need-Based Scholarships and Grants

These are awarded based on the student's financial situation. Institutions may use the information provided in the FAFSA or their own financial aid forms to determine eligibility.

4. Private Scholarships and Grants

Numerous private organizations, foundations, and companies offer scholarships and grants. These can be based on a wide range of criteria, including field of study, demographic background, extracurricular activities, and more.

In order to find private scholarships and grants, you can research the following:

• Online scholarship databases: Websites like Fastweb and Scholarships.com provide searchable databases of scholarships.
• Community organizations: Local clubs, religious groups, and civic organizations often offer scholarships to local students.
• Employers: Some companies offer scholarships or tuition assistance programs for employees or their dependents.

5. Employer Tuition Assistance Programs

Many employers offer tuition assistance as a benefit to their employees. This can be an excellent way to fund your education, especially if you're working while attending school.

Employer programs may cover a portion of tuition costs, books, and other fees. It's important to check with your HR department to understand the specifics of any tuition assistance programs available.

6. Savings and Payment Plans

If you aren't able to receive outside help to pay for your degree, there are a couple of ways you can prepare to pay for it on your own.

Savings

Using personal savings, including funds from a 529 college savings plan, can significantly offset the cost of a bachelor's degree. 529 plans offer tax advantages and can be used to pay for qualified education expenses.

Payment Plans

Many colleges offer tuition payment plans that allow students to spread out payments over the academic year, making it easier to manage the financial burden. These plans often have little to no interest, making them an affordable option.

7. Part-Time Work and Side Hustles

Working part-time while attending school can help cover additional expenses. Many students find on-campus jobs, such as in the library or dining services, which are often more flexible around class schedules. Off-campus opportunities, like retail or food service, can also provide steady income.

Additionally, side hustles like freelancing, tutoring, or selling handmade goods online can provide extra cash. It's important to balance work with academic responsibilities to avoid burnout.

8. Military and Veterans Benefits

For military members and veterans, several educational benefits are available, including the GI Bill, which covers tuition and fees, and the Yellow Ribbon Program, which helps cover costs at private institutions. Dependents of veterans may also be eligible for benefits.

9. Crowdfunding and Community Support

Crowdfunding platforms like GoFundMe allow students to raise money for their education by sharing their stories with friends, family, and the broader community. Additionally, local community organizations or religious groups may provide financial support or scholarships to students.

10. Budgeting and Financial Planning

Monitoring expenses and sticking to a budget can help avoid unnecessary debt. Students should create a budget that includes tuition, fees, books, supplies, and living expenses.

Additionally, understanding the terms and conditions of any loans taken out and planning for repayment can prevent financial strain after graduation.

Is a Four-Year College Degree Worth the Cost?

A four-year college degree is often considered a valuable investment in your future. Graduates with a bachelor's degree generally have better job prospects, higher earning potential, and more opportunities for career advancement compared to those without a degree.

According to the U.S. Bureau of Labor Statistics, the median weekly earnings for bachelor's degree holders are significantly higher than for those with only a high school diploma. Additionally, the unemployment rate for college graduates tends to be lower.

However, the value of a degree can vary based on the field of study, the reputation of the institution, and the individual's career goals. While some degrees lead directly to high-paying careers, others may require further education or experience to achieve a similar financial return.

Therefore, prospective students should carefully consider their chosen field and potential career paths when evaluating the cost versus the benefits of a bachelor's degree.

Is a Bachelor's Degree Expensive?

The cost of a bachelor's degree can be considerably high, especially at private institutions and for out-of-state students at public universities. However, the 10 options we listed above will help you pay for your degree.

What Is the Average Student Loan Debt?

Student loan debt is a significant concern for many students and their families. According to Education Data Initiative, the average student loan debt for federal loans is $37,853 while the private loan debt is around $40,000. This figure can vary widely depending on the type of institution, the length of time spent in school, and the amount of financial aid received.

Managing Student Loan Debt

For many students, taking on some level of student loan debt is necessary to finance their education. However, there are strategies to manage this debt effectively.

• Federal and private loans: Federal student loans generally offer lower interest rates and more flexible repayment options than private loans. It's advisable to exhaust federal loan options before considering private loans.
• Loan repayment plans: Federal loans offer various repayment plans, including income-driven repayment plans, which adjust monthly payments based on income and family size.
• Loan forgiveness programs: Some programs forgive part or all of the loan balance for individuals working in certain public service jobs or in specific fields for a set number of years.
• Budgeting and financial planning: Creating a budget and sticking to it can help manage expenses and prioritize loan payments. It's also essential to understand the terms and conditions of your loans and to keep track of repayment schedules.