Paying for Pharmacy School Need to Knows

A Doctor of Pharmacy (Pharm.D.) degree is a four-year, licensed professional degree that teaches students how to fill prescription medications and how to educate patients about using prescriptions safely. Pharmacy school can be expensive, adding up to nearly $200,000 dollars on the high end.

With that price tag, it’s not a surprise that pharmacy students may have to rely on a few different sources of financing to pay for school, sometimes using a combination of savings, grants, scholarships, and student loans. This article will review the pharmacy school costs, the amount pharmacists can make, and nine tips for paying for pharmacy school.

How Much Does Pharmacy School Typically Cost?

The cost of pharmacy school can vary depending on where you enroll, the location, and the extent to which public dollars support the university you plan to attend. As mentioned, the complete cost of pharmacy school can add up to $200,000. The cost can swing higher for students who opt for an out-of-state institution. The American Association of Colleges of Pharmacy (AACP) lists the tuition and fees for pharmacy school for the 2022-2023 academic year on its website, which can help you compare costs at the pharmacy schools you may be considering.

For example, the first school on the list, Auburn University, costs $22,736 for in-state pharmacy students and $43,508 for out-of-state students. Mandatory fees cost $410 for 33 credit hours for students in their first year. However, in the fourth year, it costs $27,216 for in-state students and $58,374 for out-of-state students, with $210 for mandatory fees for 46 credit hours.

It’s worthwhile to compare the costs of various institutions before you make a decision. However, remember that financial aid can potentially bring the costs down further, so don’t rely completely on the published tuition prices. A conversation with the financial aid office at each school may give you a more in-depth analysis of how much it will actually cost, taking your personal situation into account.

Is Pharmacy School Worth It?

For the right individual, pharmacy school can be worth it. The costs of pharmacy school may seem daunting, but the professional perks, ability to become a part of a healthcare team, job opportunities, and career stability can mean that pharmacy school is the right option for many individuals. The high salary of pharmacists may also make pharmacy school worth it.

How Much Can Pharmacists Make?

The 2023 median pay for pharmacists was $136,030 per year, or $65.40 per hour, according to the Bureau of Labor Statistics (BLS). Job outlook from 2022-2032 will increase 3% per year, which is as fast as average.

9 Tips for Paying for Pharmacy School

Think of paying for pharmacy school as a pie. There are many ways to pay for pharmacy school by dividing that pie. For example, various pieces of the pie might make up scholarships, grants, loans, and money out of your own pocket. No matter how you slice the pie, every dollar you contribute is an investment into your career and your future. We’ll discuss scholarships, including university, pharmacy, and private scholarships, as well as grants in the next section.

1. Scholarships

Scholarships are funds that you don’t have to pay back. You can get scholarships as a pharmacy student from a number of different sources, including from the university that you plan to attend as well as through designated pharmacy scholarships and private scholarships.

It’s worth considering other interests beyond pharmacy. Scholarships may be awarded based on heritage, location, or even hobbies or special skills. Maybe you have talents in another area that qualify you for additional scholarships.

University Scholarships

Pharmacy colleges and schools traditionally offer direct financial assistance to pharmacy students through various sources, including alumni associations and local chapters of pharmaceutical organizations and fraternities.

Consider setting a meeting with the financial aid office at the university you plan to attend to learn more about specific scholarships from each pharmacy school you’re interested in attending.

Pharmacy Scholarships

Local and state pharmaceutical associations, practicing pharmacists, drug manufacturers, and wholesalers may offer pharmacy scholarships to promising pharmacists, as well.

For example, 10 pharmacy students annually can receive a $5,000 Walmart Health Equity Scholarship. Students must be accepted or enrolled in the professional curriculum at a U.S. college or school of pharmacy, and show evidence of leadership skills, academic success, and must have a preference to serve rural or medically underserved patients.

Here’s another example: Five underrepresented minority students can receive the CVS Health Minority Scholarship for Pharmacy Students annually. Students must be African American, Hispanic or Latino, American Indian, Native Hawaiian, and/or Pacific Islander students, as well as U.S. citizens or permanent residents. Each successful candidate will receive a single $7,000 scholarship.

Private Scholarships

Private scholarships come from companies, service groups and organizations, foundations, and individuals. For example, Tylenol offers a scholarship for students pursuing careers in healthcare, including pharmacy. There may also be scholarships available from local or regional organizations.

2. Grants

Like scholarships, you do not have to repay the money you receive from grants. Grants, which are typically based on need, can also be awarded based on merit. Filling the Free Application for Federal Student Aid (FAFSA®) automatically considers you for federal grants based on need. You may also become eligible for state grants. Your college or university can give you more information about the types of grants you’re eligible for through your pharmacy program.

3. Federal Student Loans

You may be wondering how to pay for pharmacy school without loans. It’s possible to do it through a combination of scholarships, grants, and savings, though many people take advantage of federal student loans through the U.S. Department of Education. Federal student loans have fixed interest rates and benefits such as income-driven repayment plans. Just like obtaining an auto loan or a mortgage, you must pay back loans with interest.

Federal student loans are a type of federal financial aid, and to apply, you must file the FAFSA. Learn more about the requirements for this application in SoFi’s comprehensive guide to the FAFSA.

You can qualify for two types of federal student loans for pharmacy school: Direct PLUS Loans and Direct Unsubsidized Loans.

Direct PLUS Loans

Pharmacy students can take advantage of Direct PLUS Loans, also called graduate PLUS loans or direct grad PLUS loans, to help finance graduate and professional school. The Graduate PLUS Loan comes from the U.S. Department of Education for graduate or professional students. In order to get one, your school must participate in the Direct Loan Program.

The Direct PLUS Loan is not need-based, which means you can get it no matter your income level. You can borrow up to the full cost of attendance and can use the money to pay for tuition, room and board, and fees. Your school will subtract other financial aid you receive (such as scholarships, grants, and fellowships) from the full cost of attendance and award you the difference with a Direct PLUS Loan.

The interest rate is 8.05% for Direct PLUS Loans first disbursed on or after July 1, 2023 and before July 1, 2024.

Direct Unsubsidized Loans

Similar to student loans for undergraduates, you can tap into Direct Unsubsidized Loans. You can borrow up to $20,500 per year with the Direct Unsubsidized Loan, and the interest rate is 7.05% if disbursed between July 1, 2023 and July 1, 2024 for graduate students. “Unsubsidized” means that the government doesn’t pay the interest while you’re in school and during the grace period.

It’s generally a good idea to first consider opting for the Direct Unsubsidized Loan, over a Graduate PLUS Loan. Why opt for the Direct Unsubsidized loan first?

You’ll pay more in interest for the Direct PLUS Loan (8.05% interest rate).

4. Private Student Loans

Private graduate student loans do not come from the federal government. They can come from a bank, credit union, or another financial institution and can be used to help finance college or career school. The amount you can borrow depends on the costs of your degree, but also depends on personal financial factors (such as your credit score and income).

You may have gotten advice that suggested exhausting all of your federal grant and loan options before you consider private loans because interest rates are usually higher compared to federal student loans. Additionally, private student loans don’t qualify for the same borrower protections as federal student loans, like income-driven repayment plans or deferment options. However, private student loans can be an option to consider if you need additional funding to cover your pharmacy school expenses.

Recommended: Things to know before applying for private student loans

5. PSLF Programs

The Public Service Loan Forgiveness (PSLF) Program is a federal student loan forgiveness program. More specifically, you may qualify to have the remaining balance on your Direct Loans forgiven after you have made 120 qualifying monthly payments under a qualifying repayment plan. You must work full-time for a qualifying employer in order to qualify and your employer must be a qualifying organization such as a federal, state, local, or tribal government organization or other nonprofit organization.

You must have Direct Loans or consolidate other types of federal student loans into a Direct Loan, repay loans under an income-driven repayment plan, as well as make 120 qualifying payments toward your student loans. The requirements for PSLF can be quite strict, so be sure to read the requirements closely.

For more information about PSLF programs and to learn more about your eligibility, contact your loan servicer, which is the entity that services your loan.

6. Pharmacy Internships

Pharmacy internships can be instrumental in your budding career as a pharmacist in helping you understand how pharmacies operate, learning the ins and outs of customer service, helping you dive into inventory management, and learning the professional skills necessary to become a pharmacist. You may also learn more from pharmacist professionals about leading a pharmacy team and help you bring tangible professional experience back to the classroom.

You may also want to look into pharmacy fellowships, which provide financial support in an external or internal capacity (in or out of the university environment). Assistantships also provide financial support in an academic department through teaching, research, or administrative responsibilities.

7. Work Part Time

You may want to consider working a part-time job in conjunction with pharmacy school. For example, if you attend school from 8am to 4pm, you may want to seek a part-time job after hours.

However, it’s important to consider your time constraints and whether you can succeed in your coursework. Consider your ability to manage your time before you take on a part-time job. However, for the right student, taking on a job can help pay for college tuition and give you an additional source of income. Networking opportunities and skill development can come from a part-time job, even if it doesn’t relate to pharmacy.

8. Borrow From Family

Do you have a family member who really wants to give you money for your education? You may seriously consider borrowing from your parents or a sister or brother (or whoever else wants to lend you money).

Just remember that it could strain family relationships if you fail to pay back the loan. It’s a good idea to have a plan in place to repay your relative(s) as well as create boundaries, so both parties feel good about the arrangement.

9. HRSA Loans

The Health Resources and Services Administration (HRSA), an agency of the U.S. Department of Health and Human Services, improves health care for geographically isolated and vulnerable individuals.

The Department of Health and Human Services (HHS), through the HRSA, also offers several loans for health services students. For example, Health Professions Student Loans are available to individuals who study pharmacy (as well as dentistry, optometry, podiatry, or veterinary medicine). Pharmacy students who show financial need may also be able to tap into Loans for Disadvantaged Students (LDS). Health professions student loans have fixed interest rates of 5%, lower than both Direct Unsubsidized Loans and PLUS loans. They also allow 12 months of grace periods, while most other loans only offer six months of grace periods. In addition, health professions loans are subsidized, which means you don’t pay interest on the loan while you’re in school, nor do you pay additional loan fees.

However, they come with a few downsides: Not all schools participate, and there are no set borrowing limits. You also can’t tap into income-driven repayment plans or PSLF.

Private Student Loans for Pharmacy School

If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.


Cover up to 100% of school-certified costs including tuition, books, supplies, room and board, and transportation with a private student loan from SoFi.

FAQ

Can you use FAFSA for pharmacy school?

Absolutely! It’s generally a smart idea to file the FAFSA for pharmacy school, no matter your financial situation. The FAFSA can give you access to a range of financial aid options, including scholarships (your school will consider your eligibility based on the FAFSA results), grants, loans, and work-study. You want to be able to put together the best financial aid options for your needs, and the best way to do that involves filing the FAFSA.

Does CVS or Walgreens pay for pharmacy school?

CVS and Walgreens both offer pharmacy scholarships, like the ones we listed above, the Walmart Health Equity Scholarship and the CVS Health Minority Scholarship for Pharmacy Students. If you work for either company, you may also qualify through each company’s employee tuition reimbursement program. Check with the human resources department at each company for more details.

How much can pharmacists make after graduating?

The 2023 median pay for pharmacists was $136,030 per year, or $65.40 per hour, according to the Bureau of Labor Statistics (BLS). The job outlook for pharmacists is 3% from 2022 through 2032, which is as fast as average.


Photo credit: iStock/cagkansayin

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student Loans are not a substitute for federal loans, grants, and work-study programs. You should exhaust all your federal student aid options before you consider any private loans, including ours. Read our FAQs. SoFi Private Student Loans are subject to program terms and restrictions, and applicants must meet SoFi’s eligibility and underwriting requirements. See SoFi.com/eligibility-criteria for more information. To view payment examples, click here. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change.


SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.


Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

SOIS-Q224-1902934-V1

Read more
College Graduation Rates: How Many People Graduate College?

College Graduation Rates: How Many People Graduate College?

It may seem to you that droves of college students collect diplomas every year, but how many students actually start college and graduate — at the same college?

The most recent data from the U.S. Department of Education National Center for Education Statistics (NCES) reported in 2020 that the overall six-year graduation rate for bachelor’s degree-seeking full-time undergraduate students at four-year degree-granting institutions in fall 2014 was 63%.

Graduation rates refer to the percentage of a school’s students who complete their program within 150% of the published time for the program. It’s important not to confuse graduation rates with retention rates, which refer to the percentage of students who continue at a particular school the next year. In other words, the retention rate is the percentage of students who finish their first year and return for a second year.

We’ll walk through what the college graduation rate can tell you about a school, why it’s important, as well as outline a good graduation rate. We’ll also break down graduation rates by state and colleges (from lowest to highest), discuss some reasons that students might not graduate, and how to overcome some of these obstacles.

What Does the College Graduation Rate Tell Us?

As a prospective student, understanding the difference between graduation rates and retention rates allows you to be better prepared to compare these percentages against the schools on your list. Comparing the graduation rate of your first-choice college gives a definite indication of whether the schools fall above or below the average. It’s a quick way to find out how many students finish their degrees “on time” and also tells you the type of institutions that deliver the highest graduation rates. Based on available statistics, private, nonprofit institutions graduate students at a higher rate.

Why Is Knowing the Graduation Rate Important When Selecting a College?

When you’re researching colleges, many different things matter to different students. Athletes may want to know more about their individual athletic programs. English majors may want to know how many professors are published writers.

However, among all the different factors you can research, graduation rate remains one of the most important for all prospective students to understand.

Why? The graduation rate serves as a gauge for many things — student satisfaction and happiness in addition to indicating how many students graduate in a timely manner. However, it’s not the only metric you want to consider when you choose a college. Other priority considerations include teacher-to-student ratio, retention rate, loan default rates, and selectivity.

Two trusted websites compile information on graduation rates: College Navigator and College Results Online.

•  College Navigator : College Navigator compiles information from about 7,000 colleges and universities in the United States. College Navigator breaks down both retention rates and graduation rates on its site, and you can also access these rates by race/ethnicity and gender.

•  College Results Online : College Results Online also lists both rates and retention rates for institutions. You can also cross-index certain peer institutions against each other to compare graduation and retention rates.

What Is a Good Graduation Rate for a College?

The best graduation rates in the U.S. are from schools that have a graduation rate in the 90th percentile, which many of the Ivy League schools have. For example, let’s take a look at a few six-year graduation rates based on College Navigator data:

•  Harvard University: 98%

•  Yale University: 96%

•  Cornell University: 95%

However, you can still find high graduation rates within highly selective liberal arts colleges:

•  Amherst College: 95%

•  Davidson College: 93%

•  Claremont McKenna College: 92%

It’s important to remember that since these highly selective schools only admit students with top-tier credentials, they naturally attract some of the most driven students on the planet, resulting in a high graduation rate.

So, what is a good graduation rate for a college? Does this mean that a college in the 80th or even 70th percentile isn’t a good school or that it isn’t the right school for you? Absolutely not. As mentioned before, other factors play into the mix as well, based on your personal preferences and interests. The right fit for you may be a school with a 70% graduation rate. The better the fit, the more likely you will graduate on time.

Lowest Graduation Rate College in the United States

Unfortunately, the college with the lowest graduation rate in the U.S. isn’t a highly popularized statistic. However, if, during your own research, you see a school that graduates at or below 60%, you may want to probe your admissions counselor at the college for the reasons why rates are so low and find out more about how the college plans to improve.

Average College Graduation Rate in the United States

When digging a bit more into the 2020 NCES report, it states that the average college graduation rate (more specifically, the six-year graduation rate) was:

•   63% at public institutions

•   68% at private nonprofit institutions

•   29% at private for-profit institutions

Overall, 60% of males and 67% of females graduate within six years, and females had a higher six-year graduation rate at the following types of institutions:

•   Public institutions (66% female vs. 60% male)

•   Private nonprofit institutions (71% female vs. 64% male)

However, at private for-profit institutions, males had a higher six-year graduation rate than females (31% vs. 28%).

How does the U.S. Department of Education arrive at this data? The NCES uses Integrated Postsecondary Education Data System (IPEDS), a system of interrelated surveys conducted annually by NCES through institutions.

The IPEDS graduation rate is calculated like this:

Graduation Rate =
Number of students who completed their program within a specific percentage of normal time to completion / Number of students in the entering cohort

College Graduation Rates by State

Here are the college graduation rates by state, according to World Population Review :

State

College Completion (or Higher)

Massachusetts 44%
Colorado 41%
New Jersey 40%
Maryland 40%
Virginia 39%
Connecticut 39%
Vermont 38%
New York 37%
New Hampshire 37%
Washington 36%
Minnesota 36%
Illinois 35%
Utah 34%
Rhode Island 34%
Oregon 34%
California 34%
Kansas 33%
Hawaii 33%
Nebraska 32%
Montana 32%
Maine 32%
Delaware 32%
Pennsylvania 31%
North Carolina 31%
Georgia 31%
Wisconsin 30%
Texas 30%
North Dakota 30%
Florida 30%
Arizona 30%
Alaska 30%
South Dakota 29%
Missouri 29%
Michigan 29%
Iowa 29%
South Carolina 28%
Ohio 28%
Idaho 28%
Wyoming 27%
Tennessee 27%
New Mexico 27%
Indiana 27%
Oklahoma 26%
Alabama 26%
Nevada 25%
Louisiana 24%
Kentucky 24%
Arkansas 23%
Mississippi 22%
West Virginia 21%

Number of College Graduates in the 21st Century

In the past 20 or so years, the number of college graduates has increased. According to information published by Education Data , in 2001 approximately 1.24 million students graduated from college with a bachelor’s degree. In 2022, that number reached 2.02 million.

Reasons Why College Students Don’t Graduate

When looking at graduation rates, let’s turn the tables a bit and take a look at a few reasons why students might not graduate. Depending on the student, these could include things like the high cost of tuition, trying to balance work and school, or poor academic performance.

Cost

The increasing price tags aren’t a new reason that students leave school. When it gets too expensive, they may feel they have no way out. According to the National Association of School and Financial Aid Administrators (NASFAA) , an analysis of 2,000 colleges and 10 theoretical students found that 48% of families with annual incomes above $160,000 could afford the colleges on the list. Those with a family income over $100,000 could afford more than one-third of the colleges. Finally, the theoretical students from lower-income backgrounds could only afford up to 5% percent of the colleges.

Recommended: What is the Average Cost of College Tuition? 

Balancing Work and School

Many undergraduates work part-time jobs to help pay their way through college. Students often get stuck in the quagmire of trying to keep up with both work and school, which can be a challenging balancing act. Many seasonal jobs for college students exist, which means you might be able to get a job during the summer instead of working during the school year.

Recommended: 3 Summer Job Ideas for College Students

Transferring

Transferring colleges sometimes means some credits get lost in translation. When transfer students are forced to retake classes, it not only costs more financially, but they also have to spend extra time pursuing their degree. This sometimes means that students often face trouble getting enough credits to graduate.

Poor Grades

Sometimes, students simply can’t make the grades. Even if it happens during just one semester, it can cause students to shy away from college altogether. In particular, first-generation college students, those who are low-income students, as well as minority students, are vulnerable and question whether they really belong in college.

Being Denied a Student Loan

Being denied a student loan or other types of financial aid can be a huge deterrent to continuing on in college. However, remember that there are ways around it — including seeking a loan through a different lender.

Recommended: I Didn’t Get Enough Financial Aid: Now What?

Overcoming the Obstacles as a College Student

What can you do to overcome the obstacles and successfully graduate from college? Let’s find out. We’ll list a few things you can do to help you stay the course:

•  Get organized with everything — school work, athletics, homework, and more.

•  Get support from family and friends.

•  Create healthy habits. Eat nutrient-dense meals, get enough sleep, and stay healthy.

•  Carefully consider the best ways to pay for college and focus on managing your money.

•  Get to know professors and academic support professionals at your college or university.

•  Work on your time management skills so you have the time you need for important assignments.

•  Take care of your mental health. If you are struggling to balance the many priorities of being a college student, reach out to family or friends for help. If you need additional support, contact your campus’ health and wellness center to see what counseling resources are available to students.

•  Investigate transfer options early on if you attend a community college so you know how to make the transition smoother.

Recommended: FAFSA Guide

Ways to Fund College

Making sure you have a concrete plan to pay for college is one of the best ways to make sure you successfully graduate. Let’s walk through a few tips for making sure you have all your ducks in a row.

•  Fill out the Free Application for Federal Student Aid (FAFSA®).
This is the first step in applying for federal financial aid, including grants, scholarships, and low-interest-rate federal student loan options.

•  Search for scholarships. Ask the college or university you plan to attend about scholarships they offer. Don’t forget to search around in your community as well.

•  Get a work-study job. If you qualify for work-study this can be an opportunity to earn a bit of money for college expenses. This is a federal program in which you earn money and your school pays you for that work via a check, usually every week, every two weeks, or every month.

•  Look into private loans. If you need to fill the gap between scholarships, grants, and federal student loans, look into private loans to help you make it across the graduation stage. These may lack the borrower protections afforded to federal student loans (like deferment options or income-driven repayment plans) and are therefore generally only considered after other financing sources have been exhausted.

Recommended: The Differences Between Grants, Scholarships, and Loans

The Takeaway

A school’s graduation rate is a reflection of the percentage of students that graduate within 150% of the published time frame. This is different from a school’s retention rate which is a measurement of how many students remain at a school from year to year. A school’s graduation rate can be an informative benchmark as you evaluate and compare schools during the application process.

If you are a current college student, you can do a lot to make sure you stay the course, including taking care of yourself, using scholarships and grants to your advantage, getting academic help, and making sure (if needed) that you have the right private loans to make it all happen.

Ready to find private student loans to make sure you get to throw your cap at graduation? Visit SoFi and learn more about private student loans and the low rates we have to offer. Our friendly experts can also help you decide your best course of action.


Photo credit: iStock/digitalskillet

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student Loans are not a substitute for federal loans, grants, and work-study programs. You should exhaust all your federal student aid options before you consider any private loans, including ours. Read our FAQs. SoFi Private Student Loans are subject to program terms and restrictions, and applicants must meet SoFi’s eligibility and underwriting requirements. See SoFi.com/eligibility-criteria for more information. To view payment examples, click here. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change.


SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.


Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

SOIS-Q224-1903055-V1

Read more
Guide to Paying for Certified Registered Nurse Anesthetist (CRNA) School

Guide to Paying for Certified Registered Nurse Anesthetist (CRNA) School

Certified registered nurse anesthetists (CRNAs) are nurses with graduate-level education who provide anesthetics to patients in surgical and other procedures.

Currently, nurse anesthetists must have a registered nurse (RN) license and a master’s degree from a nurse anesthesia educational program accredited by the Council on Accreditation (COA) of Nurse Anesthesia Educational Programs or a Master of Science in Nursing (MSN) program. Nurse anesthesia programs typically range in length from 24 to 51 months. By 2025, all CRNAs must have a Doctorate in Nurse Anesthesia Practice (DNAP), according to the COA. It typically takes two years for a student with an MSN to earn a doctorate.

Continue reading for a look at nine tips that can help you learn how to pay for CRNA school.

How Much Does CRNA School Cost?

You may have already spent a few years paying for nursing school to get your registered nursing degree, but how much does it cost to further your education to become a nurse anesthetist?

The total cost of CRNA school (including tuition, clinical fees and other expenses) can vary widely, depending on whether you choose to attend an out-of-state institution, a private college, or an in-state university.

For example, the 2021-2022 tuition and fees at Loma Linda University in Loma Linda, California, are an estimated $138,666. In contrast, tuition and fees are approximately $45,000 for Arkansas State University’s. Note that there may be additional costs associated with a CRNA degree, such as books, supplies, or exam fees.

Note that the average nursing school cost can vary widely, ranging from $6,000 for an associate degree to over $100,000 for an advanced degree.

9 Tips to Help You Pay for CRNA School

Let’s take a look at nine tips you can use to pay for CRNA school, from choosing a less expensive school to answering the question, “Will financial aid pay for CRNA school?”

1. Choose a Less Expensive School

You can save money by choosing a less expensive school and/or by making sure that you have residency in the state of the university you want to attend. For example, the total cost of attending Georgetown University’s DNAP program for the first year is $140,693, $86,361 for the second year and $75,884 for the third year.

The cost to attend the University of Iowa is $85,553 if you’re an in-state resident or $159,206 if you’re an out-of-state resident.

It’s important to compare and contrast the costs of several programs before you decide which school will both meet your needs and help you save money.

2. Save Money

You may also want to consider saving money for college to limit the amount of money you’ll have to borrow for CRNA education. Knowing the costs of the schools on your shortlist can help you earmark a certain amount of money to set aside. However, remember that you may receive scholarships and grants that you don’t have to pay back. You might not need to save for the complete costs of a nurse anesthetist program. One way to understand your exact costs is to meet with the financial aid office of the schools you’re considering. They’ll give you an idea of the type of institutional financial aid you could qualify for.

There are a wide variety of ways to save, including through a general savings account, certificate of deposit (CD) or a 529 plan, which is a state tax-advantaged plan that will allow you to withdraw funds tax-free to cover nearly any type of college expense. 529 plans may also have additional state or federal tax benefits.

3. FAFSA and Financial Aid

The Free Application for Federal Student Aid (FAFSA®) refers to a form you can complete to determine your eligibility for student financial aid. Learn more about the FAFSA with SoFi’s comprehensive FAFSA guide.

You can qualify for federal student aid, including grants and federal student loans, through the FAFSA. You may also have to file the FAFSA in order to qualify for institutional scholarships.

4. Work More

If you’re already working as a nurse, you may want to consider picking up some more hours in order or prepare to save for your CRNA degree. It’s important to note that since nurse anesthesia programs are so labor intensive, most students find it difficult to work while attending CRNA school. However, you can certainly save up as much as possible prior to entering school in order to save as much as possible. If you must work, you may want to strictly limit your hours, but that’s a personal decision.

5. Getting an Employer to Pay for Your Education

Will a hospital pay for CRNA school?

Hospitals and groups often offer tuition reimbursement to offset loan debt. However, you may have to sign a tuition reimbursement payback agreement, which means you may have to pay back your reimbursement if you leave the company within a specific amount of time.

Ask your human resources office and read the fine print if your hospital has an agreement to see if you need to repay tuition if you get laid off or fired.

6. Grants

Grants are “free money” that you typically don’t generally have to pay back. The American Association of Nurse Anesthetists (AANA) offers nurse anesthesia grants to develop research for member CRNAs to develop healthcare policy, the science of anesthesia, education, practice/clinical or leadership opportunities. The Foundation will reimburse up to 15% indirect costs with proper documentation.

The AANA grants listed above are research grants, but you may be able to tackle state grants, school grants for graduate students and other types of grants by filing the FAFSA. The best way to learn more is to ask more questions through the financial aid offices of the schools you’re considering.

7. Scholarships

Like grants, you also do not have to pay back scholarships.

The AANA also offers scholarships. Students who are AANA members and currently enrolled in an accredited nurse anesthesia program may be eligible for scholarships as long as you’re in good standing in your program, meet the application requirements, and apply online.

In addition, the university you plan to attend may also offer merit-based scholarships. Contact your school’s financial aid office to see what they offer and how to apply.

8. Private Student Loans

Private student loans originate with a bank, credit union, or online lender, not the federal government like in the case of federal student loans. Private student loans can fill in the gaps between tuition as well as your savings, grants, scholarships, and federal student loans.

It’s a good idea to explore the interest rates, fees, repayment terms, discharge, and repayment options among private student loan lenders.

The application process usually involves submitting information about your personal information, school you plan to attend, graduation date, and loan amount you need. You must also agree to the lender’s terms and conditions.

It’s important to note that private student loans don’t offer the same borrower protections, like income-driven repayment plans, as federal student loans, so they are typically considered an option only after they have thoroughly reviewed all other financing opportunities.

Recommended: Private Student Loan Guide

9. Direct PLUS Loans

Similar to student loans for undergrads, you can also get student loans for graduate school. You do have to repay loans.

As a graduate student, you can become eligible for federal loans that come from the U.S. Department of Education, including Direct Unsubsidized Loans and Direct Plus Loans. You can borrow up to your cost of attendance. Direct Unsubsidized Loans have a lower interest rate and origination fee than the Direct PLUS Loan, also called the Graduate PLUS Loan.

For Direct Unsubsidized Loans for graduate students disbursed on or after July 1, 2023 and before July 1, 2024, the fixed interest rate for Direct Unsubsidized loans is 5.50%. Direct PLUS Loans first disbursed on or after July 1, 2023, and before July 1, 2024, have a fixed interest rate of 8.05%.

The benefits of federal loans include a six-month grace period before beginning repayment as well as flexible repayment plans with Public Service Loan Forgiveness eligibility. This means that as long as you make 120 qualifying monthly payments under a qualifying repayment plan, you might get your loans forgiven as long as you work full-time for a qualifying employer.

How Much CRNAs Can Expect to Make?

Nurse anesthetists can expect to make a median salary of $214,200 per year or $102.98 per hour, according to the Bureau of Labor Statistics. The job outlook for these jobs will grow about 38% from 2022 to 2032.

The Takeaway

There are a lot of ways to make your dreams of becoming a CRNA a reality. You may want to consider filing the FAFSA to qualify for federal loans, grants, and other types of funds. The AANA may also offer scholarships that you qualify for, but don’t forget to check with your employer or other sources, such as local businesses, for other funds.

If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.


Cover up to 100% of school-certified costs including tuition, books, supplies, room and board, and transportation with a private student loan from SoFi.

FAQ

Can you get paid for going to CRNA school?

You typically cannot get paid to attend CRNA school. However, universities often offer a wide variety of financial aid options, through both merit-based and need-based aid. You may need to file the FAFSA in order to qualify for certain types of aid. Check with the financial aid office at the universities you’re considering for more information about your financial aid options.

The American Association of Nurse Anesthetists (AANA) also offers nurse anesthesia grants and scholarships to students who qualify.

How much does CRNA school cost?

The costs of CRNA school depends on a wide range of factors, including whether you plan to attend an in-state or out-of-state institution or plan to attend a private or public school.

For example, Georgetown University, a private institution, costs $140,693 for the first year, $86,361 for the second year and $75,884 for the third year. On the other hand, the full cost to attend the University of Iowa is $85,553 for three years as an in-state resident or $159,206 as an out-of-state resident.

How much do CRNAs typically make?

As a nurse anesthetist, you can expect to make a median salary of $214,200 per year or $102.98 per hour, according to the Bureau of Labor Statistics.


Photo credit: iStock/FatCamera

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student Loans are not a substitute for federal loans, grants, and work-study programs. You should exhaust all your federal student aid options before you consider any private loans, including ours. Read our FAQs. SoFi Private Student Loans are subject to program terms and restrictions, and applicants must meet SoFi’s eligibility and underwriting requirements. See SoFi.com/eligibility-criteria for more information. To view payment examples, click here. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change.


SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.


Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

SOIS-Q224-1902890-V1

Read more
10 Tips on How to Pay for Nursing School

Ways to Pay for Nursing School

Nurses are in demand. From 2022-2032, the Bureau of Labor Statistics (BLS) predicts an average of 177,400 openings for registered nurses. Many of those openings come about due to nurses who switch occupations or exit the labor force, including those who retire.

Because nurses are in demand, you may want to attend nursing school. Let’s walk through 10 ways to help you figure out how to pay for nursing school.

1. Start With the FAFSA

The Free Application for Federal Student Aid (FAFSA®) is a federal form that students can fill out every year that gives you access to federal and institutional aid to pay for college. Your college or educational institution will use the FAFSA to determine your eligibility for federal grants, work-study, and federal loans to attend college or career school. There is no cost associated with the FAFSA.

You can file the FAFSA starting on October 1 for the subsequent academic year that you plan to attend college. For example, if you plan to attend nursing school in the fall of 2024, you can file the FAFSA starting on October 1 in the fall of 2023.

You’ll need a FSA ID, a username, and a password that confirms your identity when you’re looking at or signing official financial aid documents. You’ll need two separate FSA IDs — one for you and one for your parents, if you’re a dependent student.

You can list up to 10 colleges and universities on the FAFSA using the Federal School Code search to identify each of the schools where you’d like it sent.

The FAFSA’s data retrieval tool (IRS DRT) takes most of the work out of filing the FAFSA. It pulls information directly from the IRS. After you follow the FAFSA directions, you sign with your FSA ID.

2. Nursing School Scholarships

Some colleges may offer scholarships specific to nursing students. You can also look beyond your nursing major. Do you have talents in art, music, or leadership that could qualify you for a merit-based scholarship? (Merit-based scholarships are those that are not based on financial need.) Ask the financial aid office at the school you plan to attend for more information about merit-based scholarships.

You can also take to the web to look for more scholarships. Here are a few examples:

•  The Healthline Stronger Scholarship awards four $5,000 scholarships to students who, based on their education, extracurricular activities, and career goals, are focused on both health and climate change.

•  The National Black Nurses Association, Inc (NBNA) offers several scholarships each year ranging from $1,000 to $15,000. To apply, you must be a member of the NBNA, currently enrolled in a nursing program and in good scholastic standing at the time of application with at least one full year of school remaining.

•  The FNSNA Undergraduate Scholarship awards scholarship funds based on a set of criteria established by the sponsor of the scholarship, which often outline a specific area of specialization within the nursing profession. Successful candidates can earn up to $10,000 per academic year.

In addition to looking into what your college or university can offer and searching online, take a look at local connections for specific educational or vocational programs in a particular field, such as nursing scholarships through local hospitals and privately owned doctor’s offices.

You can also look into community groups like 4-H, Kiwanis Club, and other organizations for available scholarships. Many foundations, such as the Bill and Melinda Gates Foundation, also offer scholarships.

Recommended: Scholarship Search Tool

3. Grants for Nursing School

Grants are primarily need-based awards, though some grants are awarded based on merit. Like scholarships, grants do not need to be repaid once you complete your program. Filling the FAFSA will give you access to grants through programs like the Federal Pell Grant. The FAFSA automatically considers your eligibility for federal grants based on need.

You may also become eligible for state grants based on the grants available to you in your state.

Recommended: Grants For College – Find Free Money for Students

4. Federal Student Loans

Unlike scholarships and grants, you must pay back college loans. As a nursing student, you may tap into several types of federal student loans or private loans — both graduate or undergraduate loans.

Federal student loans are given to nursing students through the Department of Education, which, as mentioned, means that you must file the FAFSA in order to receive them.

Federal student loans offer flexibility in that you do not need to undergo a credit check, with the exception of the Direct PLUS Loan, which does require a credit check. Federal student loans also offer low-interest rates, various repayment plans, and forgiveness options. You could also use federal student loans to cover living expenses. For example, if you need to pay rent for an apartment while you’re attending nursing school, a federal student loan can help cover those expenses.

Types of Federal Loans

There are three main types of federal student loans: Direct Subsidized Loans, Direct Unsubsidized Loans and Direct PLUS Loans.

Direct Subsidized Loans

Direct Subsidized Loans are low, fixed-rate federal loans for eligible undergraduate students to help cover the costs of college or career school. The government pays the interest while you are in school or during qualifying periods of deferment. Subsidized loans are awarded based on financial need.

Direct Unsubsidized Loans

Direct Unsubsidized Loans have a low, fixed interest rate and flexible repayment terms. Undergraduate, graduate, and professional students can qualify for these loans. In contrast to the Direct Subsidized Loan, the government does not pay the interest while you’re in school. Students do not need to demonstrate financial need in order to qualify for an unsubsidized loan.

Direct PLUS Loans

Direct PLUS Loans are another option available to graduate or professional students and parents of undergraduate students. Unlike other federal loans, PLUS loans do require a credit check. Borrowers are able to borrow up to the full cost of attendance.

Student Loan Forgiveness for Nurses

Student loan forgiveness for nurses means you don’t have to pay for your federal student loans in full. The federal government runs a few loan forgiveness programs that generally offer loan forgiveness after borrowers have fulfilled certain requirements. For example, the Nurse Corps Loan Repayment Program pays up to 85% of unpaid nursing education debt for registered nurses (RNs), nurse practitioners, and nurse faculty members. You must qualify by working in a critical shortage facility or an eligible nursing school as a nurse faculty member.

Student Loan Payment Deferrals

Federal student loans do not have to be repaid until October 1, 2022, at the earliest. In March 2020, Congress passed a bill that automatically suspended student loan payments and waived interest. The benefit was originally set to expire but has been reinstituted several times.

Current nursing students who will graduate soon will not have to make student loan payments. Depending on what the federal government does next, they may also experience another extension.

5. Private Student Loans

Private student loans come from a local bank, credit union, or another type of private student loan lender, not the federal government. Like a federal student loan, you can use private student loans to cover living expenses, tuition, and other related school costs.

Lenders evaluate an applicant’s credit history, among other factors. Students who do not have a strong credit history or score may need to add a cosigner in order to qualify or potentially qualify for a lower interest rate. If you can’t pay back the loan, your co-signer is on the hook for paying back the loan.

Private Student Loans vs Federal Student Loans

As you likely know, there are some differences between private and federal student loans, which leads many financial experts to suggest taking out federal student loans over private student loans. Here are some features of private student loans that make them less advantageous over federal student loans:

•  May need a cosigner: Private student loans often require you to have a cosigner. However, if you make a certain number of on-time payments, you can apply to have your cosigner removed from the loan.

•  No federal protections: You can’t tap into income-driven repayment programs, loan forgiveness, and deferment protections with private student loans like you can with federal student loans.

Due to these differences, private student loans are typically considered an option only after all other funding sources have been depleted.

6. Tuition Reimbursement Programs

Through a tuition reimbursement program, a company covers some or all of the costs of an employee’s education as long as you follow the company’s tuition reimbursement requirements. This is a major benefit because you can work at another company, possibly through a part-time job.

7. Hospitals/Employers That Pay for Nursing School

Another option may be to work at a hospital or other health care employer through a tuition reimbursement program. For example, you could get a job in the billing office of the hospital and go to nursing school during your off hours, or you may be able to work with your employer to put together the best schedule for both of your needs.

Hospitals and health care employers want to retain good workers, particularly in nursing, which has such a shortage of employees.

Learn more about the health care employer’s requirements for tuition reimbursement, including the amount they will reimburse. Note that it may not equal 100% — it might be 75% or 50% instead.

8. Getting a Nursing Degree Abroad

Completing a nursing degree abroad can take about two to three years. However, you can find short-term study abroad programs (a fall semester, summer, or a few weeks between terms) in many different countries.

You can often find free programs, scholarships, or grants that will help cover the cost of your study abroad program — some countries offer various options for students. Consider looking into countries that have reputable health care programs, such as Denmark, Germany, Norway, Switzerland, or Sweden.

9. Military Service

You may have a large range of education benefits if you complete military service. For example, you can access the Post-9/11 GI Bill if you served at least 90 days on active duty (either all at once or with breaks in service) on or after September 11, 2001, or received a Purple Heart on or after September 11, 2001 and were honorably discharged (after any amount of time), or served for at least 30 continuous days (all at once, without a break in service) on or after September 11, 2001, and were honorably discharged with a service-connected disability, or are a dependent child using benefits transferred by a qualifying veteran or service member.

Follow the rules regarding military service requirements, depending on your branch of the military. The college and university you plan to attend will have more information about your education benefits and so will your military branch.

10. Nurse Corps Program

The Nurse Corps Program is a scholarship available to eligible nursing students. In exchange for the scholarships, recipients work in critical shortage areas after graduating with their nursing credentials.

Deciding Which Route to Pursue

When you need help paying for nursing school, which option makes sense for you? Your preferences might offer you the most insight into the best option to pay for school. For example, it might make sense to avoid the military programs offered because you have no interest in joining the military. You may also not have the resources to study overseas or have a family who depends on you for financial support. Your goal may also be to learn how to pay for nursing school without loans.

Whatever your goals, one thing you can do is to meet with the financial aid office of the school you plan to attend. A financial aid professional can lay out all your options and help you choose the right option for you.

Private Student Loans From SoFi

When you’re readying yourself for nursing school, it’s good to have options. Options for paying for nursing school include scholarships, grants, federal student loans, and private student loans.

If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.


Cover up to 100% of school-certified costs including tuition, books, supplies, room and board, and transportation with a private student loan from SoFi.

FAQ

Can FAFSA be used for nursing school financial aid?

Yes, you can use the FAFSA in order to qualify for financial aid for nursing school. The amount of financial aid you receive depends on your level of need, year in school, dependency status, and other factors. For example, you can access Direct Subsidized and Unsubsidized Loans between $5,500 to $12,500 per year in undergraduate. In graduate or professional school, you can borrow up to $20,500 each year in Direct Unsubsidized Loans.

Can an employer pay for you to attend nursing school?

Yes, an employer may pay for you to attend nursing school. Your current employer may help you pay for nursing school. Talk to the human resources office to learn more about tuition assistance, the amount you can receive for attendance, and the details about your employer’s tuition reimbursement regulations.

If you aren’t currently aware of jobs that pay for nursing school, you may want to contact the college or university you plan to attend and learn more about your employment options, including work-study opportunities.

Can you use private student loans for nursing school?

You can access private student loans to pay for nursing school. SoFi can offer private loans that cover nursing school and even living expenses. Learn more about your private student loan options with SoFi.


Photo credit: iStock/FatCamera

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student Loans are not a substitute for federal loans, grants, and work-study programs. You should exhaust all your federal student aid options before you consider any private loans, including ours. Read our FAQs. SoFi Private Student Loans are subject to program terms and restrictions, and applicants must meet SoFi’s eligibility and underwriting requirements. See SoFi.com/eligibility-criteria for more information. To view payment examples, click here. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change.


SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.


Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

SOIS-Q224-1902646-V1

Read more

Can a Roth IRA Be Used for College Expenses?

A Roth IRA can be used to pay for college expenses, and it is possible to do so without incurring taxes or penalties. However, there are disadvantages of using a Roth IRA for college, and it’s important to weigh the pros and cons.

A Roth IRA is designed to help individuals save for retirement. While you can also use a Roth IRA for college expenses, you’ll want to understand the potential ramifications.

Here’s what you need to know about using a Roth IRA for college, plus other college savings options, to help make the best decision for your situation.

Key Points

•   Early withdrawals from a Roth IRA for qualified higher education expenses can be made without penalties.

•   Pros of using a Roth IRA for college include reducing the need for student loans and avoiding the 10% penalty.

•   Cons include impacting retirement savings and potential loss of compounding returns.

•   Comparatively, a 529 plan offers higher contribution limits and potential tax benefits.

•   Choosing between a Roth IRA and a 529 plan depends on individual financial needs and goals.

Can You Use a Roth IRA for College?

You can use a Roth IRA to help pay for college. However, as mentioned, a Roth IRA is primarily a vehicle for saving for retirement. You contribute after-tax dollars to the account (meaning you pay taxes on the contributions in the year you make them), and the money in the Roth IRA grows tax-free. You can generally withdraw the funds tax-free starting at age 59 ½. However, if you withdraw the money early, you may be subject to a 10% penalty.

But there are some ways to make early withdrawals from your Roth IRA to help pay for college without being penalized. Because you contribute to a Roth IRA with after-tax dollars, you can withdraw the contributions (but not the earnings) you’ve made to a Roth at any time without paying a penalty. You could then use those contributions to help pay for college.

Just be aware that there are annual contribution limits to a Roth IRA. In tax year 2023, you can contribute up to $6,500 (or $7,500 if you’re 50 or older), and in 2024 you can contribute up to $7,000 ($8,000 for those 50 or older). How much you’ve contributed will affect how much you have in contributions to withdraw, of course.

Another way to use a Roth IRA to pay for college without being penalized is by taking advantage of one of the Roth IRA exceptions that allow you to withdraw money from your account early. One of the exceptions is for qualified higher education expenses.

💡 Quick Tip: Did you know that you must choose the investments in your IRA? Once you open a new IRA and start saving, you get to decide which mutual funds, ETFs, or other investments you want — it’s totally up to you.

Do You Have To Pay Penalties if You Use a Roth IRA for College?

Typically, if you take out money from your Roth IRA before age 59 ½ , you will be subject to taxes and penalties. However, IRA withdrawal rules grant a few exceptions to this rule, and one of the exceptions is for qualified higher education expenses.

If you pay qualifying higher education expenses to a qualified higher education institution for your child, yourself, your spouse, or your grandchildren, you won’t have to pay the 10% penalty for withdrawing funds from a Roth IRA. Qualified higher education expenses include things like tuition, fees, books and supplies. However, you will still have to pay taxes on any earnings you withdraw from your Roth IRA.

Boost your retirement contributions with a 1% match.

SoFi IRAs now get a 1% match on every dollar you deposit, up to the annual contribution limits. Open an account today and get started.


Only offers made via ACH are eligible for the match. ACATs, wires, and rollovers are not included.

Pros and Cons of Using a Roth IRA for College

Whether using a Roth IRA for college is right for you depends on your particular situation. Here are the pros and cons you’ll want to consider.

Pros of Tapping Into a Roth IRA for College

Advantages of using a Roth IRA for college expenses include:

•   You might not have to borrow as much money to pay for college. Using a Roth IRA for college expenses may reduce the need for student loans. And for some students, using money from a Roth IRA might make the difference between being able to afford to attend college or not.

•   You won’t be penalized for withdrawing the money. Because of the exception for qualified higher education expenses, you can take out the money to pay for those expenses without having to pay the 10% penalty.

•   If you withdraw just your contributions, you won’t owe taxes on that money.

Cons of Tapping Into a Roth IRA for College

These are the drawbacks of using a Roth IRA to pay for college:

•   Your retirement savings will take a hit. This is the biggest disadvantage of using the money in a Roth IRA for college. While there are other ways to help cover the cost of college, there are generally fewer options to help you save for retirement if you spend your Roth IRA funds on college expenses.

•   Because of possible compounding returns, even a few thousand dollars withdrawn from your Roth IRA today might mean missing out on tens of thousands of dollars of potential growth by the time you’re ready to retire years from now.

•   Eligibility for financial aid could be affected. Another possible downside of using a Roth IRA for college is that the money you withdraw generally counts as income on the FAFSA (Federal Application for Federal Student Aid). That may limit financial aid you could receive, including grants and loans.

Roth IRA vs 529 for College

Before you decide to use a Roth IRA for college savings, you might want to consider a 529 plan. With a 529, you can save money for your child to go to college and withdraw the funds tax-free as long as they’re used for qualified higher education expenses.

A 529 plan has more generous contribution limits than a Roth IRA does, and other extended family members may also contribute to the plan. In addition, while 529 contributions aren’t deductible at the federal level, many states provide tax benefits for 529s.

💡 Quick Tip: Before opening an investment account, know your investment objectives, time horizon, and risk tolerance. These fundamentals will help keep your strategy on track and with the aim of meeting your goals.

Which College Expenses Can a Roth IRA Be Used For?

According to the IRS, a Roth IRA can be used to pay for qualified higher education expenses. These qualified expenses include tuition, fees, books and supplies, and equipment required for enrollment or attendance.

The Takeaway

It’s possible to use a Roth IRA to help pay for qualified higher education expenses, and you typically won’t be subject to a penalty for doing so. However, taking funds out of your Roth IRA means you won’t have that money available for retirement. You’ll also lose out on any gains that may have compounded throughout the years. That could impact your retirement savings or even delay your retirement date.

Instead of using a Roth IRA for college, you may want to consider other ways to save for college that might better fit your financial needs, such as a 529 plan. That way you can save for both college and retirement.

Ready to invest for your retirement? It’s easy to get started when you open a traditional or Roth IRA with SoFi. SoFi doesn’t charge commissions, but other fees apply (full fee disclosure here).

Help grow your nest egg with a SoFi IRA.

FAQ

Can you use a Roth IRA for college?

Yes, it is possible to use a Roth IRA for college expenses. If you withdraw money from a Roth IRA for qualified higher education expenses, you generally will not be subject to the 10% early withdrawal penalty. Tuition, fees, books, supplies, and equipment needed for enrollment or attendance are usually considered qualified expenses.

Is a Roth IRA better than a 529 for college?

Deciding whether to use a 529 plan or a Roth IRA for college will depend on your specific financial situation. In many cases, a 529 plan may make more sense than a Roth IRA for college savings. You can generally contribute more to a 529 plan each year than you can to a Roth IRA, there are tax advantages to the plan, and other relatives can also contribute to it. Plus, by using a 529, you won’t be taking money from your retirement savings.

Can I withdraw from my IRA for college tuition without penalty?

Yes, you can use a Roth IRA to pay for college tuition without penalty in most cases because tuition is generally considered a qualified higher education expense. However, to avoid taking money from your retirement savings, you may want to consider other college saving options instead, such as a 529 plan.


Photo credit: iStock/Tempura

SoFi Invest®
INVESTMENTS ARE NOT FDIC INSURED • ARE NOT BANK GUARANTEED • MAY LOSE VALUE
SoFi Invest encompasses two distinct companies, with various products and services offered to investors as described below: Individual customer accounts may be subject to the terms applicable to one or more of these platforms.
1) Automated Investing and advisory services are provided by SoFi Wealth LLC, an SEC-registered investment adviser (“SoFi Wealth“). Brokerage services are provided to SoFi Wealth LLC by SoFi Securities LLC.
2) Active Investing and brokerage services are provided by SoFi Securities LLC, Member FINRA (www.finra.org)/SIPC(www.sipc.org). Clearing and custody of all securities are provided by APEX Clearing Corporation.
For additional disclosures related to the SoFi Invest platforms described above please visit SoFi.com/legal.
Neither the Investment Advisor Representatives of SoFi Wealth, nor the Registered Representatives of SoFi Securities are compensated for the sale of any product or service sold through any SoFi Invest platform.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

Investment Risk: Diversification can help reduce some investment risk. It cannot guarantee profit, or fully protect in a down market.

Exchange Traded Funds (ETFs): Investors should carefully consider the information contained in the prospectus, which contains the Fund’s investment objectives, risks, charges, expenses, and other relevant information. You may obtain a prospectus from the Fund company’s website or by email customer service at [email protected]. Please read the prospectus carefully prior to investing.
Shares of ETFs must be bought and sold at market price, which can vary significantly from the Fund’s net asset value (NAV). Investment returns are subject to market volatility and shares may be worth more or less their original value when redeemed. The diversification of an ETF will not protect against loss. An ETF may not achieve its stated investment objective. Rebalancing and other activities within the fund may be subject to tax consequences.

SOIN0224027

Read more
TLS 1.2 Encrypted
Equal Housing Lender