5 Smart Strategies for Financing Your Bachelor’s Degree

If you’re considering going back to school, one of the largest hurdles to overcome is the cost. The Education Data Initiative estimates the average in state tuition cost in the US is $9,678 annually, and $27,091 for out-of-state tuition. This figure does not include the costs of books and supplies needed for school.

As an adult looking to go back to school, balancing the demands of running a household and, potentially, the costs of raising a family, college may feel out of reach. Yet a bachelor's degree can open many doors for your career and earning potential. There are many ways to pay for a bachelor's degree, even for adult students.

Strategies for Paying for College as an Adult Learner

As you make plans to head back to school, the first step is finding a program that will work with your schedule. Once you have found an online college that accepts financial aid, then you can strategize options for financing your bachelor’s degree. Some of the top strategies include:

The FAFSA

The first step in finding ways to pay for college, even as an adult, is the Free Application for Federal Student Aid, or FAFSA. This form will tell you if you qualify for several types of financial aid, including government grants and loans. In fact, as of October 2023, undergraduate students can now directly apply for Pell Grants through the updated FAFSA system, streamlining the process and increasing accessibility for students seeking financial aid for their education. Many scholarships also look at the FAFSA to determine if a student qualifies for needs-based awards.

After you file the FAFSA, you will receive information about the financial aid you qualify to receive from the government. Grants are aid awards you do not pay back, while loans require repayment after you are done with school. Both can be good options as you look at how to pay for a bachelor’s degree.

The sooner you can submit the FAFSA, the better. Most years, it opens in October, though in 2023, it opened at the end of December. The FAFSA will show you what your financial need really is and will also provide government loan options that have better terms than private loans if you qualify for them.

The FAFSA uses the tax information from two years prior to the year you fill it out. If you find that your financial or family situations have changed significantly, you can request that the school you attend does a financial aid review to take into account your current financial information. Be sure you submit your application by June 30^th each year to ensure eligibility. Keep in mind, different states may have different application deadlines. For example, if you reside in California, your FAFSA must be submitted by April 2024.

Maximize Your Tax Breaks and Refund

California offers several tax incentives and credits that adult learners can harness to their advantage. From the California College Access Tax Credit (CalCATC) to the Lifetime Learning Credit, these measures are designed to alleviate the financial strain on individuals pursuing higher education. Adult learners can unlock the full potential of these tax breaks, leading to a higher tax refund that can be channeled directly towards covering tuition.

In order to benefit from the CalCATC, you will need to donate towards the fund and in return you’ll receive a tax credit equal to 50% of your donation. The Lifetime Learning Credit can be used throughout your bachelor’s degree program with up to $2000 per tax return.

Start and Use a 529 Savings Account

529 savings accounts offer a strategic and efficient means of setting aside funds for educational expenses. Many parents utilize this account for their children at a young age in preparation for their higher education, but it can also be utilized for adults contemplating a return to school. If your child didn’t attend college or utilize all the funds in the account, you can become the beneficiary and invest in your own development. By repurposing the 529 savings, you can pursue higher education or skill development tailored to your career goals.

529 accounts can be used to cover qualified educational expenses including tuition, books, and other costs associated with pursuing higher education. One of the primary benefits of a 529 plan is its tax efficiency as contributions to the plan grow tax-free, and withdrawals for qualified education expenses are also tax-free. Whether you are pursuing a part-time program, attending night classes, or enrolling in online courses, a 529 can adapt to various educational formats.

Ask About Employer Tuition Assistance

As an adult learner, you are likely already working. Many employers offer tuition assistance programs to their employees, especially if the employee is pursuing a degree in a field that benefits their organization. Sometimes, you may need to propose tuition assistance as something that benefits the company. For instance, if you work in sales or marketing, a Bachelor of Arts in Communication and Media may help your company better reach their target audience, and your employer may be willing to fund part of your training.

If you work in healthcare and want to advance into a leadership role, your hospital or clinic may be willing to support your education if you work toward a BBA in Healthcare Administration. Even if your employer does not offer tuition assistance on a regular basis, they may be able to establish a program to help you if your degree will help them.

However, a significant benefit is that education assistance programs (EAP) offered by most corporations fall under the Internal Revenue Code Section 127. By utilizing a Code 127 program, both employers and employees can avoid federal payroll taxes on qualifying payments, and employees will save on federal income taxes that would otherwise apply. There is a $5,250 limit per year for these programs, which is why most corporations cap the program at the limit. Anything above that amount each year is considered taxable income.

Prior Learning Assessments

Adult learners often have work experience that covers many of the same things touched on in college courses. You can use this knowledge to get credit and save on the overall cost of your bachelor’s degree. Submitting a portfolio, for example, may allow you to receive credit for courses directly related to your major. For some programs, especially those in the field of information technology, you may even receive direct college credit for earned industry certifications. This means a majority of expenses will go towards fulfilling your general education requirements and advanced coursework.

The College Level Examination Program, or CLEP, offers tests you can take at a low cost to show your knowledge of basic subject matter in return for credit. At UMass Global we accept CLEP credits and DANTES Subject Standardized Tests credits.

Invest in a Bachelor’s Degree from UMass Global

If you are ready to go back to school and start or finish your bachelor's degree so you can take the next step in your career, UMass Global has flexible degree programs to help. Our employer-aligned curriculum provides real-world applications students can apply to their jobs immediately, and flexible course schedules work well for adult learners. Our financial aid office and one-stop specialists can help you can find creative ways to finance your education. Learn more about our bachelor's degree programs and apply today.