Ways to pay for college: Why the order matters

If you’re figuring out how to pay for college, the price can feel overwhelming. The good news is that most students don’t pay the full sticker price. Once scholarships, grants, and other aid are applied, what you actually owe is often much lower.

It also helps to know that you probably won’t pay for college with just one source. Most families combine four or five different sources: free money, federal aid, work, savings, and sometimes a loan to cover what’s left.

The order you use them in matters. Start with money you never have to pay back, then move to federal aid, and only then consider borrowing from a private lender. This guide walks you through each step so you can build a plan that keeps your costs as low as possible.

Key takeaways

• Know your real number first. Your cost of attendance and net price matter more than the sticker price.
• Start with free money. Scholarships and grants never need to be repaid.
• File the FAFSA. It unlocks grants, work study, and federal student loans.
• Work, save, and use payment plans to shrink what you borrow.
• Borrow federal before private. Federal loans come with fixed rates and borrower protections.
• Fill any remaining gap last with private student loans, after cheaper options are used.
• Cut costs where you can, so there’s less to cover in the first place.

Step 1: Know your real number

Before you look at ways to pay for college, figure out what you actually need to cover.

When you think about how to pay for college tuition, remember that tuition is only one piece. Start with the cost of attendance. Cost of attendance is the school’s estimate of the full cost of a year of college, including tuition and fees, housing, meals, books, supplies, transportation, and personal expenses. Tuition might be only part of what you’ll spend.

Next, look for a net price calculator on each school’s website. You enter some basic information about your family’s finances, and the calculator estimates what you might pay after grants and scholarships. Two schools with very different sticker prices can end up costing about the same.

Finally, know the difference between an aid offer and a bill. Your aid offer lists the grants, scholarships, work study, and loans you’re eligible for. Your bill shows what you owe the school directly. Loans in your aid offer still have to be repaid, so they don’t actually lower your cost, they just change how you pay it.

Step 2: Scholarships and grants

Scholarships and grants are free money. You never have to repay them, which is why they should be the first place you look for funding.

Grants are usually based on financial need. They can come from the federal government, your state, or your school. The federal Pell Grant is the best known, with a maximum award of $7,395 for the 2026–27 award year.

Scholarships can be based on grades, talent, community service, your intended major, your background, or simply entering a giveaway. You can find them through:

• Your school’s financial aid office
• Your high school counselor
• Local businesses, community groups, and religious organizations
• Employers, including your parents’ employers
• Free scholarship search websites
• Lenders and companies, including Ascent’s no-essay scholarship giveaways

Apply to as many as you reasonably can. Think of it as a numbers game: the more you apply for, the better your chances.

Don’t skip the small, local awards. A $500 scholarship from a community organization may get far fewer applicants than a big national award, so your odds can be much better. Several small scholarships can add up quickly.

Keep a simple list of deadlines and requirements, and reuse essays where the prompts overlap. Scholarships aren’t just for high school seniors, either. Many are open to current college students, so keep applying every year.

Step 3: File the FAFSA

The Free Application for Federal Student Aid, or FAFSA, is your key to federal aid. It’s also free to file, so you should never pay anyone to submit it for you.

The FAFSA unlocks:

• Federal grants, like the Pell Grant
• Federal Work-Study, which helps you earn money through a part-time job
• Federal student loans, which usually cost less and offer more protections than private loans

Your FAFSA isn’t just for federal aid. Many states and colleges use the information on it to decide who gets their own grants and scholarships, so filing it can help you qualify for even more free money.

File even if you think your family earns too much. There’s no income cutoff to file, and some aid, like Direct Unsubsidized Loans, isn’t based on need. Many schools also require the FAFSA before they’ll consider you for their own scholarships.

Timing matters too. The 2027–28 FAFSA is open now, and the federal deadline is June 30, 2028. State and school deadlines are often much earlier, so file as soon as you can. You’ll also need to submit a new FAFSA each year you’re enrolled in school to continue receiving financial aid.

To learn more, read how the FAFSA works and check your FAFSA eligibility.

Step 4: Work study and part-time jobs

Earning money while you’re in school can reduce what you need to borrow.

Federal Work-Study is a need-based program that you qualify for through the FAFSA. It helps you find a part-time job, often on campus or with a community service organization. Your aid offer shows how much you’re eligible to earn, but you still have to find and work the job. Work study pay is typically sent to you as a paycheck, not applied directly to your bill. Work-Study earnings are generally taxable, but they aren’t counted as income when your school calculates your federal student aid eligibility for the following year.

A regular part-time job works too, on or off campus. It may pay more, but it may be less flexible around your class schedule.

Be realistic about hours. Working a moderate number of hours per week can fit alongside a full course load, but working too much can hurt your grades and make it harder to graduate on time.

Work income usually covers living expenses like books, food, transportation, and personal expenses. It rarely covers tuition on its own, but every dollar you earn is a dollar you don’t have to borrow.

Step 5: Savings and payment plans

Savings and family contributions can cover a big share of college costs without adding debt.

529 plans are tax-advantaged savings accounts for education. Money grows tax free and can be withdrawn tax free for qualified education expenses, like tuition, fees, housing, books, and supplies. If your family has a 529, check the plan’s rules before withdrawing so you use it for qualified costs.

Family contributions can come from parents, grandparents, or other relatives, whether from savings or current income. Talk openly as a family about what everyone can realistically contribute each year so there are no surprises.

Tuition payment plans let you spread your bill over monthly payments during the semester instead of paying it all at once. Many schools offer them for a small enrollment fee or none at all, and they usually don’t charge interest. That means your family can pay part of the bill from monthly income rather than borrowing.

Together, these options can shrink the gap you need to cover with loans.

Step 6: Federal student loans

If savings and payment plans don’t cover everything, federal student loans are usually the next step. They’re offered by the U.S. Department of Education, and you qualify by filing the FAFSA.

There are two main types for undergraduate students:

• Direct Subsidized Loans are for students with financial need. The government pays the interest while you’re in school at least half time, during your grace period, and during deferment.
• Direct Unsubsidized Loans are available to undergraduate students regardless of need. Interest starts adding up from the day the loan is paid out.

Federal loans have fixed interest rates set by Congress, so your rate won’t change over the life of the loan. For the 2026–27 award year, the rate for undergraduate Direct Loans is 6.52%.

There are annual and total limits on how much you can borrow, based on your year in school and whether you’re a dependent or independent student. For example, a dependent first-year student can borrow up to $5,500 per year.

Federal loans offer multiple repayment options including income-driven repayment options, deferment and forbearance, and forgiveness programs such as Public Service Loan Forgiveness for eligible borrowers.

Borrow only what you need, even if you’re offered more. You can accept part of your loan amount and turn down the rest.

Step 7: Use private student loans to cover the rest

If you’ve used scholarships, grants, work, savings, and federal aid and still have a gap, a private student loan can help cover what’s left. Private loans are supplemental. They’re meant to fill a remaining gap, not replace federal aid.

Here’s how private student loans typically work:

• They’re often credit based. Lenders look at credit history and income, so approval and rates will vary.
• A cosigner is usually needed. Most undergraduate students don’t have enough credit history to qualify on their own, so a parent or other trusted adult often cosigns. A cosigner shares responsibility for the loan and may help you get a better rate.
• You can often choose fixed or variable rates. A fixed rate stays the same for the life of the loan. A variable rate can start lower but may change over time.

Before you borrow, compare lenders on interest rates, fees, repayment options, grace periods, and whether they offer cosigner release. Eligible juniors and seniors may also be able to get a student loan without a cosigner, like Ascent’s outcomes-based loan. Many lenders let you check your rate without affecting your credit score.

Whether you apply with a cosigner or on your own, Ascent’s undergraduate student loans can help you cover your remaining costs, with flexible options and resources so you can pay for school with confidence.

Step 8: Cut the cost instead of funding it

Sometimes the best way to pay for college is to need less money in the first place. Here are a few ways to lower your total cost:

• Start at community college. You can complete general education courses at a lower cost, then transfer to a four-year school. Check transfer agreements so your credits count.
• Stay in state. Public schools usually charge much lower tuition for state residents.
• Earn credit early. AP, IB, CLEP, and dual enrollment courses can help you skip some college classes and save on tuition.
• Live at home or commute. Housing and meals can be one of the biggest parts of your cost of attendance.
• Graduate faster. Some programs offer three-year degrees, and taking a full course load each term can help you avoid paying for extra semesters.
• Ask about employer tuition help. Some employers offer tuition assistance for employees, including part-time workers. If you’re going back to school as an adult, make sure to ask your employer about tuition assistance first.

Even one or two of these can make a real difference in your total cost.

How to pay for college without parents

If you’re paying for college on your own because your parents aren’t able to help, you still have options.

Start with the FAFSA. If you’re under 24, you’ll usually need to include parent information. But you may qualify as an independent student if you’re married, a veteran, supporting a child, a ward of the court, or experiencing homelessness, among other situations. If you have unusual circumstances, such as an unsafe home, your school’s financial aid office can review a dependency override. Independent students can often receive more federal aid, including higher Direct Loan limits.

If you need a private loan, a cosigner doesn’t have to be a parent. A grandparent, relative, family friend, or other trusted adult with good credit may be able to cosign.

If no one can cosign, look into student loans without a cosigner. Some lenders offer loans based on factors beyond credit history, such as your school, major, or expected graduation date.

How to pay for college with no money saved

Not having savings doesn’t mean college is out of reach.

Start by filing the FAFSA as early as possible. It’s free, and it unlocks grants, work study, and federal loans. Students with the greatest financial need often qualify for the most grant aid.

Next, stack as much free money as you can. Apply for scholarships every year, and ask your school’s financial aid office about institutional grants.

Finally, choose a school you can afford. Compare net prices, not sticker prices, and consider community college or an in-state public school. A school that offers more aid can end up costing less than one with a lower sticker price.

How parents pay for college

Parents who want to help pay for college usually use a mix of these options:

• 529 plans and savings. Money saved over time is usually the least expensive way to help.
• Parent PLUS loans. These are federal loans for parents of dependent undergraduate students. For loans first disbursed on or after July 1, 2026, borrowing is capped at $20,000 per year and $65,000 total per student.
• Private parent loans. Private parent loans can help cover remaining costs, with the loan in the parent’s name.
• Cosigning. Instead of borrowing themselves, parents can cosign their student’s private loan. The loan stays in the student’s name and helps them build credit.

To compare Parent PLUS and parent student loans in detail, see Parent PLUS vs parent student loans.

A realistic example

Here’s how one student might stack different sources to pay for a year of college. These are illustrative numbers for example purposes only. Your costs and aid will be different.

Say a student’s cost of attendance is $30,000 for the year. Here’s how they might cover it:

Source	Amount
Federal and state grants	$4,000
Scholarship from the school	$6,000
Local scholarship	$1,000
Federal Direct Loan	$5,500
Work study	$2,500
Family contribution and payment plan	$8,000
Total before a private loan	$27,000
Remaining gap	$3,000

After using free money, work, family help, and federal aid, this student has a $3,000 gap. That’s where a small private student loan could come in. Because they used cheaper options first, they borrow far less than they would if they’d started with a private loan.

To see what monthly payments might look like, try our student loan calculator.

Frequently asked questions

What is the best way to pay for college?

The best way to pay for college is to use the cheapest money first: scholarships and grants, then savings, then federal aid, then a private loan for whatever is left. Free money never has to be repaid, so it should always come first. Savings and family help can cover costs without adding debt. Federal loans come next because they offer fixed rates and borrower protections. A private loan should fill only the remaining gap.

How do most people pay for college?

Most families combine multiple sources to pay for college rather than relying on just one. According to NASFAA’s 2026 coverage of how families paid for college in the 2025–26 academic year, those sources can include family income and savings, scholarships and grants, and borrowing. Mixing sources helps families keep borrowing lower and spread costs across different options.

Can you pay for college without loans?

Yes, but it usually takes a mix of free money, working in school, choosing a less expensive school, and family help. Students who receive large grants or scholarships, start at community college, live at home, and work part time may be able to graduate without borrowing. It’s not realistic for everyone, though. If you do need to borrow, keeping the amount small and choosing federal loans first can help.

How do I pay for college if my parents won’t help?

Start by filing the FAFSA and checking whether you qualify as an independent student, which can increase the federal aid you receive. If you have unusual circumstances, ask your financial aid office about a dependency override. For a private loan, a cosigner doesn’t have to be a parent. A relative or trusted adult may be able to help. You can also look into loans that don’t require a cosigner.

Should I take federal or private loans first?

Take federal loans first, every time. Federal student loans have fixed interest rates set by Congress and don’t require a credit check for undergraduates. They also offer income-driven repayment and forgiveness options that private loans don’t have. Private student loans are best used to cover any gap that remains after you’ve used scholarships, grants, savings, and federal aid.

How much should I borrow for college?

Borrow only what you need to cover your remaining college costs after scholarships, grants, savings, and other financial aid. Before borrowing, consider how much you expect to earn after graduation and whether the monthly loan payments will fit within your budget. A student loan calculator can help you estimate what your monthly payments might look like after graduation.

The best way to pay for college: Build your plan in order

Paying for college works best when you follow the right order. Know your real number, then use scholarships and grants and file the FAFSA. Work, save, and use payment plans to shrink what you borrow, then take federal loans before anything private. Look for ways to cut costs along the way. If there’s still a gap after all that, a private student loan can help you cover the rest.

Ready to cover what’s left? Apply Now