College costs: Getting beyond sticker shock

Find out how financial aid can lower the cost of college

What might buying on credit actually cost?

If you're like most high schoolers, you're currently counting down the days until summer vacation. But before you trade schoolbooks and study halls for sandals and sunshine, plan to use part of your summer vacation preparing for college.

First up: understanding college costs and how to pay for them.

Sticker price vs. actual price

When it comes to planning for college, it's important to understand the difference between a college's published cost of attendance, or "sticker price," and the amount students actually pay. This is because financial aid covers a portion of college costs for many students.

In fact, some of the most prestigious —and expensive — colleges also have the most generous financial aid programs. Taking this into account can help relieve some of the shock and make college feel more within reach.

But while colleges do their best to help students close the gap between what they can afford and what college costs, most students still need additional assistance. The dream of a free ride to college sounds great, but it's very rare, and students and parents should be prepared to consider all of their options.

Filling in the funding gap

So how can students and parents make up the difference? Scholarships should be first on every student's financial aid shopping list. Scholarships are generally awarded based on academic, athletic, or other achievement; or based on a student's attributes, ancestry, or program of study.

Don't assume you can't qualify. There are thousands of scholarships out there and you just may be the perfect candidate for one or more of them. Take advantage of free scholarship search engines like those on Adventures In Education or Fastweb to look for potential sources of aid.

In addition, you can look for part-time jobs on campus to help supplement your income. Keep in mind that not all students will qualify for the college-work study program, but that doesn't mean you can't find work on campus.

If necessary, students can also take out federal student loans, or parents can take advantage of federal parent loans (also called Plus loans) to help pay college expenses. Be sure to seek federal loans first, before using private loans from commercial lenders. Federal loans offer more benefits, such as flexible repayment plans and potential loan forgiveness under certain conditions.

Finally, if you receive multiple financial aid awards from different schools, it's best to compare all of the awards before choosing a school. And families should discuss any exceptional financial situations (for example, a sudden loss of employment or high medical bills not covered by insurance) with the college's financial aid office. The school may be able to reevaluate your eligibility for aid based on these circumstances.

While college can be expensive, it's an investment that pays off in the long run. Don't be intimidated by the price, and remember that aid is available to those who qualify and do their homework. Good luck in pursuing your college dreams!