Honesty moment: If you asked me what one thing I attribute my financial success to, I would say graduating college debt-free. Without hesitation. Not the fact that I’ve landed well-paying jobs or am frugal to a fault or have been driving the same car for 9 years. No, it’s the lack of those student loans. I recognize that not having a $500 (or more) payment per month has allowed me to do things that many others can’t, like add more to my retirement fund, save for and buy a house, go to Peru to hike the Inca Trail, remodel my godforsaken bathroom…you get the picture. And I feel incredibly fortunate for it. And something I hope I can someday do for my children.
So this is my story of how I made my way through college without student loans. It is not a “how-to” guide to help you figure out how to do the same because, to be honest, I don’t think it’s a plan everyone has the opportunity to follow. This is just my real life story, and I hope you can glean at least one thing from it that will help you (or your children) someday do the same.
Growing up, I was dead set on going to Princeton. Why, I have no idea. I had never been to Princeton. I had never even been to New Jersey. But to me, a then 12 year-old Midwesterner, Princeton seemed like the epitome of what a college campus should be like, and that’s where my heart was set on going. I’m sure my parents cringed when I told them of my future goal. Ivy League is not cheap, and considering my mom was a teacher (a profession we all know is underpaid) and my dad a carpenter, that was a little out of the price range. Like a Range Rover on a Civic budget.
Knowing this, my parents sat me down and made it very clear that if I wanted to go to Princeton, scholarships had to be in play. And to get scholarships to Princeton, you had to be the best of the best. So that’s what I tried to do. I studied my butt off. I took the hardest classes offered at my high school. I spent nights pouring over my homework when others were out having fun. But it paid off. The only B I can ever remember earning was in 7th grade art class. And I earned the spot of valedictorian of my (small – think 90 kids) high school class. Holla at ya girl.
I was also a 3-sport athlete, which means I basically trained for 350 of the 365 days out of the year. I thought I shouldn’t put all my eggs in the “smart kids” basket (diversification, am I right?), so every day after school and every week except 2 during the summer, I was training. Even on my off days, I was doing something – going for a run, practicing my free throws, working on my left-footed cross. Whatever I had to do to get where I wanted to go, I was going to do it.
And then it came time to actually start to apply to college, and Princeton faded from my options. New Jersey is a long way from home, and that Ivy League tuition just didn’t seem worth the cost. I was even recruited by the University of Pennsylvania, another Ivy League school (home to Wharton Business School, the alma mater of our beloved Donald Trump), and Notre Dame to run track but turned them down because even with any scholarship money I would receive, they were too expensive. WAY too expensive. And also maybe partly because I hated track. Ok, that may have been 75% of it, but I digress.
So I moved my options a little closer to home. One of the best business schools in the nation was a little over an hour away, so Indiana University immediately became an option. And because I wasn’t certain whether I fully wanted to hang up my shoes in the athletic arena, I also looked at Marian University in Indianapolis, who was offering me the opportunity to play soccer.
And you guys, I want you to know that I made a shitty decision. A horrible decision actually. Ok, not horrible, but in hindsight, not one that I would make now. Want to know why? Well, here are the numbers. Guess which one I picked?
Yeah, not IU. And I want to kick myself for it because while all that hard work did earn me some decent scholarships, do you know how everything else was paid for? Yep, by my parents. Meaning I f*#$ed my parents over big time. And the bad part is, I don’t even remember doing it. I was talking to my dad a couple of weeks ago going over the tuition numbers with him, and when he told me about it, I responded by saying he should have let me know there was such a big difference. And his response? “You did know. You just hated IU’s campus so much and wanted to play soccer, so we allowed you to go to Marian.” Talk about making a person feel like crap. Here my parents had saved and scrounged for us to go to school, and I couldn’t even help them out by going to a GREAT school for cheaper. Nicely done, Britt. You a$$hole.
So yes, I graduated college without student loans because a) I earned some fairly lucrative scholarships and b) my parents paid for the rest. I’m lucky. I know that. I realize not everyone has the parent card to play in their back pocket. But the question on my mind was always, “How did they do it?” Because it wasn’t just my school they paid for; they sent my brother to the same private university as well. Like I said before, neither of them had extremely lucrative jobs. I don’t know the numbers, but I’m sure they had a decent amount of money coming in and we did live in an area with one of the best standards of living in the state, if not the country. But it still seemed like a stretch. A teacher and carpenter sending two kids to private school? Doesn’t even seem like a possibility.
Because that’s the thing: I wasn’t some spoiled little rich kid…because we weren’t rich. We weren’t even upper middle class. We were comfortable, but it’s because of my parents’ frugality that they were able to do this for me and my brother. And even in college I recognized the sacrifices they had to make in order to do that for us. It was a tough thing to do, which is why while they took care of all of our necessities during college, we always took care of the rest. Any new clothes I bought with my own money. Any dinners or movies or 2am Taco Bell runs were funded by me. Spring break? Yeah, that was on me, too. And at the end of the semester, any book money I received back went straight to them, and any scholarship money I won during school was sent to them as well. They were giving me a huge leg up in this world, and I never felt right asking for more from them when they were already giving me more than they should have.
That being said, before we go any further, I want to take a TV timeout to give a shout out to my parents. These two deserve a big round of applause here (feel free to clap for them if you’d like) for succeeding in something that many others who made more than they did couldn’t. And it’s allowed me to succeed like nothing else could. So kudos to you, Tim and Yvonne. You guys rock.
Now back to the story. I called my pops one Saturday morning to get the nitty gritty details about how they actually did it. Because, really, I just couldn’t wrap my head around it, and we honestly had never really discussed it before. Or maybe we did, and I didn’t remember. It seems I have a habit of that.
He basically nailed it down to two main things, which were a mixture of both good planning and strategy:
Pure old-fashioned savings, folks. That is how a majority of my school was paid for.
They weren’t saving for our college in particular, but it was always a habit of theirs to regularly put money aside for future costs – like a car or college or emergency. And to do this meant giving up a lot of other (and more fun) things, but I don’t think they thought twice about it. Call it the German way – we’re sometimes frugal to a fault even when we don’t need to be, which is where I’m sure I get it from.
See, everyone? It’s inherited, so it’s ok. I can’t help it.
#2: THE 529 SAVINGS PLAN
I had originally thought that my parents had been saving within a 529 plan for awhile prior to my brother and I going to college, but that was not the case. You see, in Indiana, the main benefit of contributing to a 529 plan is that the state offers a 20% tax credit for any contributions up to $5,000. This means that if you contribute the full $5,000 in one year, $1,000 gets knocked off your tax liability or refunded to you if you don’t owe anything. Pretty good deal, right? However, that tax credit wasn’t put into place until 2007, well into both my brother and I’s college years.
Thus, my parents didn’t start contributing to a 529 plan for either of us until 2007, and the only reason they did it was to get that tax credit. They’d put $5,000 in each year, pay our college bills, and receive $1,000 back on their return, essentially cutting that portion of our college costs to them by 20%. It was a strategic move, and it probably saved them a few thousand dollars in the process. High five to them.
Interested in learning more about 529 plans? Click here.
And, guys, that was it. Those two things – diligently saving and utilizing a 529 plan – allowed my brother and me to go to school without taking out a single student loan. It’s amazing what a little willpower can do, and it’s proof that even if you’re not earning a high salary, you can do the same.
So there you have it, folks. My real life story of how I graduated college debt-free. I asked my mom why they decided to pay for all of our schooling since it’s not that common anymore, and she said she remembered what it was like to have that burden coming out of college and didn’t want us to have it as well. It was selfless, and I can never repay them. But it’s a legacy I hope to continue with my children, and one that I hope you learned something from as well.
Now it's your turn: What did you do to lower the cost of college? Are you planning on paying for your kids' education?