How to Pay for College

Posted by Tom Rose on Thursday, March 16, 2017
Tom Rose

Tom is a career educator and technologist. He has been a professional test preparation tutor for over a decade and is the co-founder of Testive. Tom started Testive at MIT, after spending years as a highly paid private SAT and ACT tutor, to provide students with personalized, efficient and affordable test prep

In the previous chapter of the Ultimate College Prep Guide, we talked about all of the discretionary things that your student can do to make their application even stronger. In addition to grades and test scores, the SAT Subject Tests, college interviews, extracurricular activities, and the mid-year update are all taken into consideration by admissions officers when reviewing your student's application.

In this chapter we'll tackle the part of the college application process the extends past the actual application — how to pay for college. Higher education in the US is undeniably expensive, especially if your student is planning to go to a private institution. But there are quite a few options that you and your student can explore to help pay this cost and get the college experience they want most.

How Do You Know If You Qualify for Financial Aid?

To start the process of applying for need-based financial aid, you will first need to fill out one or two forms: the FAFSA and/or the CSS Profile. Most colleges and universities only require the FAFSA, but about 200 colleges also require the CSS Profile.

Once these forms are submitted, they're used to calculate your family's Expected Family Contribution (EFC) towards the cost of college. The EFC is then subtracted from a college's total cost of attendance to determine whether a student qualifies for need-based financial aid.

To estimate your EFC, you can use this Quick Reference Table. The intersection of the number of dependent children you have and your AGI (aggregate gross income) will give you an approximate of your federal EFC based on parental income only.

EFC Table

Keep in mind this table doesn't take into account any parent or student assets which may bring up your EFC. Your EFC will also be split equally if you have more than one student in college.

Your EFC will determine one of two possible outcomes:


Grants are awarded according to financial need and do not require repayment. Grants can be awarded from a variety of different sources:


There are two general types of loans your student could get: Federal Loans and Private Loans.

Your student can apply for Federal Loans by submitting the FAFSA. The money is provided by the federal government and students are required to pay back the loan with interest over time. These loans tend to have lower fixed interest rates and come with flexible repayment plans that can be modified based on your needs.

The amount of money students are eligible for is dependent on their year in college, whether they are a dependent or independent student, and whether their parents are able to obtain PLUS Loans.

PLUS Loans

Students should only consider taking out a Private Loan if they've maxed out the Federal Loan. Often these loans come with high fees that can significantly increase the cost of the loan. FinAid's Loan Analyzer Calculator may be used to generate an apples-to-apples comparison of different loan programs.

There are a number of other loan options that parents or students can take out to help pay for college including mortgage and home equity loans, intra-family loans, and 401k loans. Each comes with different risks and methods of repayment. If possible, we recommend sticking with the safest method of taking out a loan — the Federal Loan.


Scholarships are typically awarded based on academic, athletic or artistic achievement or extracurricular performance. The best way to find which scholarships your student may qualify for is to use Scholarship Search. This allows you to filter your search depending on interests, age, grade level, etc.

To give you a brief look at how many different types of scholarships are available, we've compiled a list. Just a few of the categories scholarships fall into include:

The list goes on and on. Take the time to see what scholarships your student may qualify for — there's likely more than you might think.

Save Some Money

The thought of dishing out thousands of dollars to pay for college is enough to send a shiver down anyone's back. But it doesn't have to be as scary as it might initially seem. Take the time to fill out applications and do your homework on what options are out there to help make paying for college as painless as possible.

The best way to maximize your chances of receiving aid or scholarships is to stay organized and not miss any deadlines. To help with this we've put together this deadline chart for you to record important dates and stay on top of everything your student is applying for:

Financial Aid Deadline Chart [Free Download]
Download your Financial Aid Deadline Chart to keep track of every way you can save money on college.



In the next and last chapter of the Ultimate College Prep Guide, we address some of the things international students should know about how to apply for university in the US. We also provide resources they might need to help them successfully apply and attend university in the States.

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