Help your kid cut college debt

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| By Richard Satran, U.S. News & World Report

Here are some cost-cutting tips from students and college financial aid people.

Financial planners will give you a quick list of the things you must absolutely do to pay for your child's college (529s, Stafford loans, Coverdell savings accounts, savings bonds, home equity loans) but sometimes their advice is hard to follow in the time frame you have—and often they involve piling on more debt.

Students already are choking on $1 trillion in loan repayments for college. Parents spend and borrow huge amounts beyond that. But what can you do in the near-term to make the funds you have go further?

With help from students and college financial aid officers, we've compiled 11 tips to cut college costs and avoid borrowing more:

When shopping for a school, get past the sticker price. "It really is like buying a car," says Chanel Greene, manager of the office of financial aid for Peirce College in Philadelphia. "People look at the sticker price and get shocked and say I am not going there. But like cars there are lots of option." There are rebates and scholarships nearly every school offers or knows about. Saving on college costs requires that you "look beyond fees and tuition. It's really never as simple as comparing apples to apples," Green says. Cost-effective education plans are even more complicated than car deals. Consider all of the options.

Live off campus. This might rank lowest on parent's cost-saving lists. But it's more than an off-campus party pad and potentially the biggest moneysaver on the list. The College Board says the amount colleges charge for room and board has jumped 65 percent over the past decade—about twice as fast as inflation. Boomer parents who opted for dorm life when they went to school a generation ago often paid below-market rates. Not true anymore. "You can share a place and really cut down on rental costs, and you also pay less for things like food if you share with roommates," says David Ellman, a Brown University student now taking time off to work on a social media startup.

Take that year abroad. The dream of jetting off to Paris for a cafe-society semester at the Sorbonne or zipping down Florence's narrow streets to get to class at the Academy of Arts was a luxury purchase then. Not any more. With American colleges the most expensive in the world, students can save by taking that year abroad, even with transportation costs included. Becoming more popular are Latin American destinations like Chile, Costa Rica, Brazil, and Argentina, and further-flung places like South Korea, India, and South Africa, as students seek out less expensive and more exotic study-abroad locations alongside with old favorites like Britain, France, Italy, and Spain, according to the Institute for International Education. In a global economy, the experience often pays dividends in the job world. But smart shopping is essential since fees vary widely. It's also a good thing to consider in your initial college search: Some U.S. schools assess fees while students study abroad.

Don't assume your income is too high for financial aid. "It's one of the most common mistakes. There is no real 'cutoff' for financial aid assistance," says Peirce's Greene . "Everyone should fill out the FAFSA (Free Application For Federal Student Aid) regardless of income level." "There are a lot of factors we take into account," she says. Sometimes they are not even part of FAFSA. The college where she works is a low-residency school where many adults attend and parents often don't know that their own school costs can be a factor in weighing their children's financial awards.

Return unused loan money. Students will sometimes qualify for loan refunds if they do not use the funds during a financial aid period. Some see it as a kind of tax refund to be treated as a bonus for travel, or to reinvest in costs not directly related to their degrees. Either way that loan adds to total debt. Greene recommends that students return them when they don't use them for school costs.

Don't be afraid to ask questions. It's the job of financial aid offices to provide information, says Greene. "A lot of people ask their neighbor or friend what they did to pay for college. If you do that you will only be getting part of the picture." Some parents are afraid to approach the financial aid office at the school where their child is applying for fear it will hurt their child's chances of getting in. But some schools will view it as a sign of serious interest, a positive in admissions. And the majority of students look for financial aid. Some schools admit their student admission policies are not entirely "needs blind." But talking with financial aid specialists are unlikely to be a factor. Once a student is admitted, financial aid officers want to see students graduate and usually are ready to help.

Let financial aid office know about a change in your situation. "I've come across students who are embarrassed to say that their parent has lost their job. But they really should share that information because sometimes we can help," says Greene. Many schools have emergency funds for just this situation. There are also federal programs that come into play when jobs losses hit parents.

Wrong numbers on forms can be costly. Incorrect information can be costly since it can lead to delays in processing forms. Incorrect Social Security numbers are one of the biggest errors that turn up, says Greene, and that mistake alone could be enough to delay aid for weeks or months.

Don't be embarrassed to start college trips early with your kids. Some early high school students will feel peer pressure not to do tours when they are far from graduation. They don't want to be uncool in high school. Adults, too, worry about being seen as pushy by taking younger students on college trips. But early visits are great chances to explore schools and fully understand the costs and benefits. What's more, an ambivalent high school freshman might find new inspiration in their visit to State College in springtime when things are in bloom. "The old junior-year visit is done partly because the dorm visits are more difficult with younger students," says Greene. "But most schools will be glad to arrange tours or visits with younger teens."

Share debt with your children. Many boomer parents don't want to stick their kids with huge debt. It's an admirable goal, but at least a small piece of borrowing on the student's part can be an incentive to manage and understand costs. Green says, "It's not bad if they have some skin in the game."

Set a realistic number. Before the college chase begins junior year, it pays to consider what you can afford to contribute and talk about it with your child. Try to be encouraging. Some kids will decide they don't want to pay the cost, or will not want to add to their parent's money burdens. Have the talk at the start of the application process before getting accepted at a too-expensive dream school turns into a family nightmare. Remember that you will probably want to be fair in giving equal opportunity to all of your children, so asses the overall costs and limits to family income.

Get a (reasonable) job. Over 50 percent of students work in college. But too much of a good thing can hurt the college experience and also hurt students' grades. A National Survey of Student Engagement study showed that if students work for 20 hours or less, it will not hurt grades. Over that level academic performance suffers, the study shows.

Every student has their own tips. A 2010 Cornell graduate, public relations executive David Brodnick of Weber Shandwick, found a way to stretch dollars at the deli counter.

"My own dollar stretching tactics in college surrounded holding down a deli job that allowed me to eat lunch for free at work (not to mention actual pay) and to go off the university's costly food plan. Living in a fraternity house for three years I saved probably $5,000 to $10,000, as all living expenses were included, and I didn't have to cook or clean, and could focus on studying."

Think small. In getting a degree that costs $100,000 to $200,000, nickel and dime savings might not seem so big. But even a relatively small cost can become larger if its paid out over the life of a student loan, with interest. As Greene says, "It really all adds up and it can be more painful later in life when you pay back those loans."