Balancing your own student loan debt while preparing to send your child to college is a challenge many families face. You may feel stretched thin, trying to make your monthly payments while also saving for tuition, books, and other education costs. The good news is that with careful planning and the right tools, you can make progress in both areas.
In this guide, you’ll learn how to reduce your student loan burden and create a path to saving for your child’s future.
Before you can build a plan, start with a full picture of your student loans. Make a list that includes:
Federal loans can be reviewed using your StudentAid.gov account. Private loans may require you to log into individual loan servicer websites.
Once you have this information, you’ll be better prepared to explore repayment options that free up cash flow for savings.
If you’re struggling to keep up with loan payments, enrolling in an income driven repayment plan could help. These plans cap your monthly payment based on your income and family size, often making your payment more affordable.
There are several types of IDR plans:
Each has different rules and benefits, but all are designed to make repayment more manageable. Learn more and compare plans at StudentAid.gov.
If you work in a public service job, you might be eligible for loan forgiveness. The Public Service Loan Forgiveness (PSLF) program forgives any remaining loan balance after 120 qualifying payments while working full-time for a qualifying employer.
Eligible employers include:
This program can significantly reduce your loan burden. For more details, visit the PSLF information page or review Credit.org’s guide to Public Service Loan Forgiveness.
Once your loan payments are under control, it’s time to start saving for your child’s education. One of the best tools is a 529 college savings plan. This type of account allows your savings to grow tax-free and offers tax-free withdrawals for qualified education expenses.
You can use a college savings calculator to estimate how much to save each month based on your child’s age and your budget.
Starting early—even with small amounts—can lead to significant savings over time.
When parents think about college costs, they often look at tuition alone. But many other expenses should be considered:
Research each school’s total cost of attendance. A good place to start is the U.S. Department of Education’s College Scorecard, which lists real-world data on graduation rates, student debt, and more.
Understanding full college costs will help you set realistic savings goals and avoid surprises down the road.
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Not every student needs to begin their education at a four-year university. Starting at a community college can significantly reduce overall college expenses. Students can complete general education requirements and transfer to a university later.
Benefits of choosing community college include:
Many states offer programs that guarantee transfer to public universities after two years of community college, making it a strategic financial choice.
The sticker price of a college doesn’t tell the whole story. The net price is what you actually pay after grants and scholarships are applied.
To get a better estimate, use each school’s Net Price Calculator, usually available on its website. This tool will help you understand how much financial aid you may receive and what your true out-of-pocket cost will be.
Knowing the net price is critical when deciding how much to save and how to compare schools.
Every student should submit the Free Application for Federal Student Aid (FAFSA) every year they attend school. This form determines eligibility for:
Don’t assume you won’t qualify based on income. Many families are surprised to learn that they qualify for need-based or merit-based aid. File the FAFSA as early as possible to maximize your chances of receiving aid.
If your child needs to borrow money for school, prioritize federal loans over private ones. Federal student loans offer protections and benefits that private lenders typically do not provide.
Key features of federal loans include:
Private loans often have higher interest rates, fewer protections, and stricter repayment terms. Encourage your child to exhaust all federal options first.
Beyond public service forgiveness, there are other programs that cancel student loan debt under specific conditions. Some examples include:
Some members of the military may also qualify for tuition assistance through the VA Top-Up program or receive additional support through Military OneSource.
Understanding these programs can help you and your child make career choices that also reduce education debt.
Paying for college doesn’t have to mean taking on large amounts of debt. Many families combine several strategies to reduce costs. These include:
These other options can lessen the need to borrow and help students graduate with less financial stress.
Some families think scholarships are only for high school seniors, but that’s not true. Many scholarships are open to current college students, graduate students, and even adults returning to school.
Encourage your child to apply regularly using tools like:
Make scholarship applications a routine part of each school year to reduce the need for loans.
Saving doesn’t have to be complicated. Small, consistent deposits into your child’s college fund can make a big difference over time.
Here are some practical ways to build a habit:
The key is to keep going, even if the amount is small. What matters most is that you start early and stay consistent.
Preparing your child for college also means preparing them to make good financial choices. Teach them early about:
You might involve them in comparing college offers based on net price or walking them through your own loan repayment experiences.
Financial literacy is a skill that pays off long after graduation.
Before your child accepts any student loans, use the Loan Simulator tool at StudentAid.gov to compare different repayment period options.
The tool can help estimate future monthly payments based on loan type, repayment plan, and income. This makes it easier to understand how borrowing today will affect their budget tomorrow.
Comparing repayment options in advance allows for better decision-making and realistic budgeting.
It’s tempting to put every extra dollar into your child’s college fund. But it’s also important to save for your own future.
Retirement should still be a priority. If you neglect it now, you may find yourself depending on your child later. Try to:
A healthy financial balance supports both you and your child over the long term.
Your income, your child’s school plans, and financial aid availability may all change from year to year. Make a point to review and adjust your college savings and loan repayment strategies annually.
Consider:
Revisiting your plan helps you stay flexible and take advantage of new opportunities.
According to Sallie Mae’s latest report, most families use a combination of savings, income, grants, scholarships, and loans. Few rely on a single source.
On average, the largest portion comes from parents’ income and savings, followed by scholarships and grants, then loans.
Knowing how other families pay can help set realistic expectations and remind you that you’re not alone in navigating this process.
To recap, here are some of the most helpful steps you can take today:
Reducing your student loan debt and saving for your child’s future may sound like competing goals, but they can go hand in hand. With consistent effort, good information, and smart use of available resources, you can lower your debt burden and create meaningful savings.
Start small, stay consistent, and remember that even modest steps forward have a big impact over time.
You don’t have to figure it out alone. At Credit.org, we’ve been helping families like yours reduce debt, plan for the future, and build strong financial foundations for decades.
Our services include:
Let us help you take the right steps today. Visit our student loan assistance page to speak with a certified counselor and get started.
