How to Attend College Debt Free!


When you think of college, what types of things come to mind? The cost of tuition? Books? Financial aid? No doubt, college can be a stressful time, but you don’t have to add the burden of a strained financial life to the picture. You can be healthy – financially – and still graduate on time with good grades.

It’s all about planning. As it says in the Bible:

Suppose one of you wants to build a tower. Won’t you first sit down and estimate the cost to see if you have enough money to complete it? – Luke 14:28

Going to college debt free is a lot like building a tower. You’re going to have to strategize and make sure you’ll have enough money to fund it while you’re in school. Sit down and estimate the cost before you start!

The Two Sources of Income

While you’re in college, there are primarily two sources of income you can use to fund your tuition and other expenses. Sure, there are a lot of ways to make money, but they all stem from these two sources:

1. College Reserves

This is money that you’ve made and saved up before you went to college. This is the very best way to save up money for college, as you know that the money is already there to support you when you have that massive tuition bill dropped on your lap. I recommend saving up as much money as possible before going to college.

2. Income During College

This is money that you’re making as you’re going to school. By landing a part time (or if you’re brave, full time) job, you can pay your way through college. I do not recommend starting college without a significant amount of reserves built up first, but finding income while you’re in school can help you complete your education debt free.

As you’re going through college, you might want to consider obtaining a cash back debit card from PerkStreet Financial. We pay for our college education with our debit card, and save a lot of money!

Remember Income Loss

Another calculation to throw into the mix is your loss of income. Don’t assume that you’ll be able to work your full time job while attending college. You might get burnt out and quit your job or you might find your homework too time-consuming to continue full time at your job.

When you are trying to determine how much money to save up in your college reserves fund, make sure to consider your income loss during that time. Save up more money before you attend college if you anticipate your income dropping.

The more money you have in your college reserves fund the less risk you have of not being able to “build the tower.”

Determining Your College Reserves

Here’s a formula you can use to determine how much money you should have saved up before you attend college. It goes like this:

(Cost of Tuition + Books + Room and Board) – (Extra Money Made During College * .8) = College Reserves Fund (at start of college)

For example, let’s pretend it will cost you $70,000 to go to college. During that amount of time you’ll make $20,000 that you can throw toward your college education. Here’s the calculation:

($70,000) – ($20,000 * .8) = $54,000

So, you might want to save up $54,000 before you even step foot on the campus. Some of you have observed that I throw in a 20% reduction in the extra money made during college estimation. That’s to ensure that you take into account any emergencies or unexpected drops in income. It helps lower your risk.

Now, you might have a different formula than I have outlined above (I understand my formula is rather simplistic, but it’s a starting point). That’s okay! The point is, you should sit down and count the cost. Don’t get caught without a plan, or you might just end up with a lot of student loan debt.

Graduate debt free. You’ll love it. It’s a fresh start to your new life!

Are you thinking about attending college debt free? Tell us about your situation in the comments, we’d love to hear it!

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  1. Marissa

    Great tips here! I was actually very blessed to graduate debt-free without having any scholarships or reserves to begin with. I worked full-time to pay for my education while I studied, and I completed my entire accredited bachelor’s degree in exactly two years.
    It’s a non-traditional method, but I found CollegePlus to be the perfect fit for me. This program is all about using your time and money efficiently while getting the best possible education from a Christian worldview, complete with a personal mentor to coach you through the process.
    I’d recommend it, from experience, as the best way to graduate college debt-free.

  2. Ben Mordecai

    Great info, but I think you left out two crucial variables:

    1. The salary increase of having a degree
    2. Scholarships

    The first is usually difficult to estimate unless you are in certain fields (gov’t for example which can guarantee salary increases for a degree). Nonetheless it makes a huge difference. I went to college straight out of high school and I had a lottery funded scholarship, so I got free tuition the whole time for maintaining a 3.0. But if I had to save up money in advance, I would have probably made about 15k a year working full time with no experience. Graduating with an engineering degree can usually get you in the neighborhood of 50k a year. Even if you accumulated 50k of debt in college, you could get out of debt in a year if you live below your means. But making 15k a year will hardly yield you any savings when all of your expenses are covered. So that is one case when it really would make sense to get into debt for school.

  3. Gayle McLaughlin

    There are tuition free colleges like College of the Ozarks where kids work for their college education! I have visited College of the Ozarks and it is truly unique!

  4. Mary

    We saw Dave Ramsey earlier this year at his Nashville Dave Live event. A segment of the day was devoted to this topic. He advised people not to overlook your own state’s universities. His kids went to the University of Tennessee; he reviewed the low cost that was paid and felt like it was a tremendous value for the money.

    I think a big part of the equation is lowering that cost!

  5. Joan

    Luckily, I didn’t have any school loans to pay back b/c my parents took care of the cost. I did work at a Kentucky Fried Chicken (now KFC) part-time. I took the job thinking that not many people go to KFC since I had never been to one. Boy, was I wrong! Thursday nights were gizzard nights – people came in like crazy!! Ick!

  6. Samirian @MoneyWisdoms

    Great Article. I did not receive scholarships during college, but it is an option. From those that were successful say that you have to be diliegent, persistent and organized. You have to treat it like a part time job. Another option is to turn your passion into income. I wrote a book review this week on my blog called: Don”t Get Suckered: How to Survive College Debt Free and an article called Achieving Scholarship Success Today! http//

  7. Lindsey

    I think you said it right…. Most of it is planning. The problem I think, is that a lot of kids, when they’re going off to college, don’t see how much their tuition will really cost them via loans. At least I know I didn’t. I didn’t have a comprehension of how much money I was actually taking out….either that or I didn’t want to take the time to figure it out.

  8. MIKE

    I went to a community college in the 70’s. I saved up money like crazy when I was growing up- had $5000 and a paid-off car when I hit campus in’76. I budgeted $1 a day for personal fun expenses and giving($7 per week), although I didn’t always spend it. I worked my 1st semester of college and the summer between freshman and sophmore year. I had no scholarships, grants,or money from relatives, yet I could have gotten them if I tried. I walked out of college with about $235, and no debt. I suggest that students apply for scholarships, grants, and plan to work while in college and summers. Get a job during your high school years that will hire you back in the summer in your college summer months. God will take of you, if you will put Him first!!