Congrats on getting in to college! Now send money

College's biggest challenge can be paying the bills
College's biggest challenge can be paying its bill. Illustration by Jesse Garcia of South High School in Minneapolis.
If you’re stuck with big college loan payments you’ll have less money to buy a house, pay for a wedding or purchase a car.

“Study hard. Go to college,” is the mantra of many parents to their children. Although some teens worry about getting in, many don’t realize that the biggest challenge of college isn’t always admission or academics, but simply being able to pay for it.

Students are expected to pay for their tuition with various options such as savings, which is out of your family’s pocket; loans, which is money you pay back with interest once you finish or leave college; and grants and scholarships, which is free money that you don’t have to pay back.

Students may need to take advantage of all of these methods of paying, with the cost of tuition continuing to rise annually. “Most students and their families can expect to pay, on average, from $172 to $1,096 more than last year for this year’s tuition and fees, depending on the type of college,” according to a 2009 study by College Board, a commonly used college information resource.

More than $100 billion in federal education loans and $10 billion in private loans are given out each year, according to, a website that serves as a student guide to financial aid. Michelle Overtoom, financial aid counselor at University of Minnesota-Twin Cities, said that there has been a rise in students borrowing money from the University to pay their tuition.

But loans have to be paid back with interest. James Hammar, a senior financial aid counselor at the University of
St. Thomas, sees loans as “borrowing money from yourself in the future.”

If you’re stuck with big college loan payments you’ll have less money to buy a house, pay for a wedding or purchase a car. Also, if you don’t pay on time you’ll have a bad credit history or might even find collection agencies
harassing you.

In her sophomore year at Columbia College in Chicago, Maranda Gorr-Diaz already has a little over $50,000 in college debt. She’s been trying to find additional scholarships but has found most to be geared toward low-income students, which means she doesn’t qualify. “Yes, I do [worry], but I’m working hard in school and hoping for an academic scholarship along the way,” she said.

Despite the cost, Gorr-Diaz still feels as if she chose the right college due to the potential long-term benefits. “I am a journalism major with a minor in PR … I looked for schools that were ranked very well for that field. I came up with Columbia and the University of Iowa … My final decision came to thinking of the job opportunities as a journalist in Chicago verses job opportunities as a journalist in Iowa.”

She has gotten a job as an resident assistant this year in her dorm and will be able to save money on her housing. She also chooses to do her own grocery shopping to save money instead of going on a meal plan.

However, even with her plans to save money, Gorr-Diaz still may end up paying off her debts for a very long time.

Shannon Peters graduated from Cornell College in Iowa in 2004 and then received her law degree from Drake University in 2007. She was $156,000 in debt when she finished law school and pays $1,600 per month in student loan payments. “It’s more than my mortgage,” Peters said.

With that financial responsibility, every extra dime Peters makes goes to paying off her loans, so she has no savings or retirement account. She could have saved money for college by attending an in-state or public school instead of attending more expensive private schools.

Peters does not regret her undergrad choice. “It was worth every penny,” she said.

However, if she could go back she “wouldn’t have chosen such an expensive law school.”

According to, students who attend private colleges leave with an average debt of $26,683. College students who attend state universities owe an average of $16,369, and students who attend two- year community colleges owe an average of $12,307.

To minimize debt in college, Peters worked hard for good grades. “Every year Cornell would give me more money because of my performance,” she said.

Avoid loans as much as you can — you may have heard the stories people paying off their student loans well into their 40s. Unfortunately, most of us can’t avoid borrowing some money to help pay for college. So be smart about how much you borrow and the kind of loan you take.