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If you’ve ever wondered about the difference between an available balance vs. current balance for your bank account, know that a current balance reflects the amount of money in a checking or savings account at any given moment. The available balance, on the other hand, shows you the current balance, plus or minus any transactions that are pending but have not yet been processed fully. The available figure is what you can actually spend at that moment.

Financial institutions share these two balances with their customers to give as detailed a picture of funds on deposit as possible. While it may be confusing at first glance, once you understand the difference, it can actually help you stay in better control of your cash.

Read on to learn more about current vs. available balances on your bank accounts.

What Is a Current Balance?

The current balance of an account is a reflection of the amount of funds that are moving throughout a checking account or savings account at any given time.

This is a compilation of both credits and debits — incoming and outgoing funds — within an account. It includes transactions that have been completely processed on both ends and posted to an account.

Pending transfers or payments that have been authorized but have not been fully processed yet may be listed in your transaction history but are not included in the tally. So any debit card payments, mobile deposits, or automatic bill payments that haven’t been fully processed will not be calculated into the current balance.

As an example, say Brian’s checking account balance is $200.

•   On Monday, his employer deposits an $800 payment into his account that clears and posts on the same day, raising Brian’s current balance to $1,000.

•   On Wednesday, Brian uses his debit card to pay $100 for dinner, and the restaurant places a hold on his account for the amount. Because the payment is pending and awaiting processing, Brian’s current balance is still $1,000.

•   However, if on Friday the restaurant charge is fully processed and posted onto his account, his current balance would drop to $900.

What Is an Available Balance?

An available balance is the current balance of a checking account or whatever type of savings account you may have, minus any pending payments and deposits. In essence, it takes the total amount of all fully processed and posted credits and debits and subtracts the total amount of any pending payments that have yet to be fully processed. This provides a more accurate reflection of the money in your account that remains available to be spent.

For example, Danielle’s checking account balance is $500. She uses her debit card to pay a $100 internet bill, and her landlord cashes her $300 check for her rent — both payments appear on her account as pending.

Despite her current balance being $500, her available balance is only $100 due to the pending payments. If she were to make other payments totaling more than $100, she will risk an overdraft fee and having a negative bank balance.

Recommended: Savings Account Calculator

What Is the Difference Between Current Balance and Available Balance?

If an account goes a week or two without any activity, its available balance and current balance will likely be in sync. However, once purchases and payments are made with a debit card linked to your checking account, that is when the available balance is likely to fluctuate.

The key difference between a current balance and an available balance is “promised payments.” A current balance is the total amount of money in an account including money that has been promised to other people or businesses. An available balance, on the other hand, is the specific amount of money available that has not been promised to any person or business. While spending the full amount of a current balance with pending payments could result in overdraft or NSF fees, spending the full amount of an available balance should not.

Generally, when a current balance and available balance differ, here’s the likely situation:

•   The available balance is the lower of the two, and it’s nearly always due to a pending payment.

•   In some less common cases, an available balance may appear larger than the current balance. This could be due to receiving a refund from a purchase or the reflection of a bank overdraft protection buffer on an account. Either way, in this case, it would be wise to contact your bank for a better understanding of your current account standing.

How Long Does It Take for a Current Balance to Become an Available Balance?

The amount of time it takes for an available balance to sync back up with a current balance depends on the specific amount of processing time needed to complete each pending transaction.

Those times can vary depending on the type of transaction and how quickly the establishment processes it. The account holder’s ability to refrain from spending with their debit card and adding more pending payments to the account is also a major factor.

As a general rule of thumb, individual pending payments can take as little as 24 hours or as long as five days to be completely processed and posted to an account. The process requires communication and confirmation between the banks of the account owner and the establishment they purchased from. Some transactions, especially international ones, can take longer than others to be completed.

If a transaction remains pending for up to a week, it would be wise to contact the merchant or your bank for clarity.

Which Balance Should I Rely On?

The current balance and available balance each serve their own purpose, and both can be relied upon as an accurate representation of a checking or saving account. However, there are specific instances when it would be better to reference one over the other.

•   If you’re planning on making a purchase or withdrawal, that is an instance where it would be more beneficial to reference the available balance on your account. It’s the best way to know exactly how much money is available to be spent without disrupting any other pending payments.

Checking the available balance will give the most exact account of what is freely available to be spent and will also help you avoid incurring any overdraft fees.

•   If you’re more interested in your account balance as a whole and how much money you have flowing through your account at any given time, that is when you’ll want to reference your current balance. It accounts for every dollar entering and exiting your account at the very moment you check it.

Do keep in mind, however, that the available balance total may change quickly due to pending transactions, therefore it would be wise to check it daily for the most up-to-date tally.

Recommended: How Often Should You Monitor Your Checking Account?

The Takeaway

Your available balance shows how much money is available in your account at a given moment, while the current balance also includes pending transactions that are still being processed. Knowing what your account balances mean and how to interpret them is a basic but important financial skill that can help you manage your money better.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with eligible direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.

Better banking is here with SoFi, NerdWallet’s 2024 winner for Best Checking Account Overall.* Enjoy 3.30% APY on SoFi Checking and Savings with eligible direct deposit.

FAQ

Why are my current and available balance different?

Your available balance shows how much is currently in your account for spending or paying others. The current balance reflects transactions that are still processing, such as a deposit that hasn’t fully cleared yet.

How long does it take for a current balance to become an available balance?

The amount of time it takes for bank transactions to clear can take a matter of hours to several days, depending on the details. For instance, if you are waiting for an international check to clear, it could take around five days.

Can I spend my available balance or my current balance?

Your available balance is what is available for spending, while your current balance shows you the amount that will be in your account once the transactions that are processing are fully cleared.

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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.

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Tuition-free college sounds like a fantasy. But at some colleges and universities, it is possible for students to qualify to attend without paying tuition costs.

Not all colleges offer free tuition, and some may require students who are receiving free tuition to maintain certain academic standards or meet other requirements. Other colleges may offer a reduced-tuition option for eligible students.

When considering that attending a four-year college can cost tens of thousands of dollars, the appeal of free tuition is obvious. Read on for more details about how free-tuition programs work and an overview of colleges that offer free or reduced tuition.

What Is Tuition-Free?

Tuition-free college is where the cost of tuition is covered for eligible students, often through government funding or institutional aid. This can apply to community colleges, public universities, or specific programs, reducing financial barriers to higher education.

There are a limited number of schools that offer free college tuition to students. There are also schools that offer free tuition if your parents earn less than a certain amount of money per year.

Keep in mind that offers of free college tuition often may not include other costs like books, fees, transportation, or room and board. Researching the total cost of attendance at your chosen institution will give you a complete picture of your financial obligation.

Still, tuition is, generally speaking, a huge cost — so not having to pay it could mean huge savings.

Why We Need Tuition-Free College

For many families, college is prohibitively expensive. Parents who want to foot the bill for their kids may feel stressed and guilty when they find they can’t afford the cost of college out of pocket, and students themselves may feel the repercussions of the exorbitant cost of school for decades.

Still, there are both pros and cons to consider when deciding whether a tuition-free university is right for you. Here are some things to consider.


💡 Quick Tip: Fund your education with a low-rate, no-fee SoFi private student loan that covers all school-certified costs.

Pros of Free College Tuition

The main pro of free college tuition is saving money. Maybe you had planned on taking out student loans to pay for school. Think of the financial freedom you could enjoy if you didn’t have to spend years paying off student loans after graduation.

Second, free tuition can help make college more accessible for low-income students. If your family can’t financially contribute to your education, and you aren’t willing or able to accumulate educational loan debt, free tuition programs can make college a possibility.

Recommended: “College vs University: What’s the Difference?“

Cons of Free College Tuition

Few colleges offer free tuition to all students, which means your options for schools may be more limited. Some tuition-free programs are competitive. A few of these programs are connected with the U.S. Military and require students to serve after graduation.

Many tuition-free colleges are small, private schools, and a good amount are religion-based. You may want to consider whether these are environments you would enjoy for four years.

Because there are so few schools offering free tuition, attending school may require you to move further away from home. Depending on the student, this could be a pro or con.

Some schools have certain requirements for those who attend and/or receive free tuition, such as participating in a work-study program, maintaining a certain GPA, or living on campus.

Before you apply to a tuition-free program, you’ll want to consider all the pros and cons to decide if the program is right for you.

Schools That Offer Free College Tuition to All Students

Here are 31 tuition-free colleges in the U.S. Fifteen offer free tuition for all students, and 16 offer free tuition to students from low-income families.

Service Academies

The United States Air Force Academy (Colorado)

The Air Force Academy provides free tuition, room, board, and medical and dental benefits. Students must serve as an officer in the Air Force for at least eight years, and at least five of those years must be in active duty.

The United States Coast Guard Academy (New London, Connecticut)

The Coast Guard Academy offers students free tuition, room, and board. Students must serve as a Coast Guard officer for at least five years after graduation.

The United States Merchant Marine Academy (Nassau County, New York)

Midshipmen receive free tuition, uniforms, books, room, and board. Basic medical and dental care are also provided by the Academy’s Office of Health Services. However, any healthcare expenses that exceed the provided health plan will need to be covered. Students are also responsible for transportation during leave periods. The Academy recommends applying for student loans if you need help with these expenses. Service obligations after graduation may vary between five and eight years.

The United States Military Academy at West Point (West Point, New York)

Tuition, room, board, and medical and dental insurance are free for West Point students, and they also receive a monthly stipend. Incoming Plebes, as new students are called, have to pay a one-time fee of $8,400 to cover uniforms, books, and other equipment. Graduates are commissioned as Second Lieutenants in the Army. You must serve a minimum of eight years, though that obligation is a combination of Active Duty and Reserve.

The United States Naval Academy (Annapolis, Maryland)

The Navy covers students’ tuition, room, board, and medical and dental costs. In return, they must serve in active duty for at least five years after graduation.

Four-Year Schools

Alice Lloyd College (Pippa Passes, Kentucky)

This liberal arts college provides free tuition to residents of Central Appalachia, which spans five states including Kentucky, Ohio, Tennessee, Virginia, and West Virginia. Students are required to participate in the Student Work Program , which involves at least 10 hours per week and 160 hours per semester. They must cover expenses other than tuition.

Barclay College (Haviland, Kansas)

This Christian school provides a scholarship equal to the amount of tuition to students who live on campus. Students must cover the cost of room, board, or other fees.

Berea College (Berea, Kentucky)

Berea is a liberal arts school that provides free tuition to all students. In order to qualify, students must come from families with limited resources. The average annual family income of Berea students is less than $32,000. Students, however, pay some costs , including room, board, health and dental care, which add up to about $4,000 per semester. Almost all Berea students (96%) receive Pell Grants to cover those costs.

College of the Ozarks (Point Lookout, Missouri)

This Christian liberal arts college provides free tuition for full-time students, provided they participate in the work-study program, which involves 15 hours per week and two 40-hour workweeks per year. Room, board, fees, or books are not included.

Curtis Institute of Music (Philadelphia, Pennsylvania)

The conservatory provides free tuition to undergraduate and graduate students through merit-based scholarships. If students need financial assistance for other fees and living expenses, they can participate in the work-study program.

Macaulay Honors College (New York City, New York)

The highly selective honors college is part of the City University of New York. It provides free tuition to New York state residents who are admitted to the program. Students must maintain a certain GPA during their time at Macaulay, and they are responsible for additional fees including covering room and board.

Warren Wilson College (Swannanoa, North Carolina)

Warren Wilson is a small, private liberal arts college in North Carolina. Students who qualify for federal and/or North Carolina state-based aid receive free tuition. You must be a North Carolina resident, enroll as a full-time student, live on campus, and participate in the work-study program. If you don’t qualify for free tuition at Warren Wilson, the school is known for providing generous scholarships.

Webb Institute (Glen Cove, New York)

This engineering college provides free tuition to all students and financial aid opportunities to cover additional fees. The school offers only one undergraduate degree: a dual Bachelor of Science in Naval Architecture and Marine Engineering.

Junior Colleges

Deep Springs College (Deep Springs, California)

This unique two-year college is located on a remote cattle ranch in California. Only 12 to 15 students are admitted each year, and tuition, room, and board are free. Students can apply for additional scholarships if they need help covering other expenses.

Williamson College of the Trades (Media, Pennsylvania)

This men’s vocational college teaches trades such as carpentry, power plant technology, and masonry. Each student receives the Williamson Scholarship, which is need-based and can be as high as $38,900, which is $140 shy of the school’s estimated costs for tuition, room, board, and annual fees.

Schools That Offer Free or Reduced Income-Based College Tuition

The following schools offer varying amounts of tuition assistance depending on a student’s family income level. Based on the information a student provides on the yearly Free Application for Federal Student Aid (FAFSA®), schools take into account both parent contributions and student contributions to determine financial need.

Offers of free tuition may sometimes mean that the parent contribution is equal to zero, but there may still be an expected student contribution.

Ivy League Schools

Brown University (Providence, Rhode Island)

Brown fully covers tuition for families earning $125,000 or less. In addition, students of families making less than $60,000 a year will receive scholarships that cover all expenses including tuition, room, board, and books. Students can apply for additional scholarships to help support other expenses.

Columbia University (New York City, New York)

Students qualify to attend tuition-free if their parents earn less than $150,000 annually and have typical assets. For students coming from families who earn less than $66,000 annually, there is no expectation of parental financial contribution. All incoming first-year students are expected to pay $2,400, which is the minimum student contribution as part of their financial aid award.

Cornell University (Ithaca, New York)

Cornell guarantees no parental contribution and no loans for students whose families earn less than $60,000 per year and typical assets. For students from families with total annual income up to $75,000, the annual aid offers include grants and work-study only — students are not expected to need to take out loans.

Dartmouth College (Hanover, New Hampshire)

For students whose families earn less than $65,000 per year with typical assets, there’s no expectation of parental contribution, and the aid award does not include any loans. Students are expected to contribute toward their own expenses, but they can choose to take a loan if needed. The Dartmouth Scholarship provides free tuition for students from families with total incomes of $125,000 or less who possess typical assets.

Harvard University (Cambridge, Massachusetts)

Harvard University has announced that, beginning in the 2025-26 academic year, students from families with annual incomes of $200,000 or less will receive free tuition, while those from households earning $100,000 or less will have all billed expenses — including tuition, housing, food, health insurance, and travel — fully covered.

Princeton University (Princeton, New Jersey)

Princeton offers full tuition, room, and board for students whose parents earn less than $100,000 per year. Families above that threshold still receive substantial aid depending on assets and number of children in college.

University of Pennsylvania (Philadelphia, Pennsylvania)

Students from families with incomes less than $200,000 (and typical assets) receive financial aid packages that cover tuition, fees, room, and board. UPenn states they are also eligible for additional benefits, like laptop funding and summer opportunity funds. This builds on Penn’s long-standing no-loan policy and its earlier Penn First Plus program, which fully covered tuition, fees, housing, and dining for families earning up to $75,000.

Yale University (New Haven, Connecticut)

Yale expects zero parent contribution for students whose families earn less than $75,000 per year and have typical assets. Students from families who earn between $75,000 and $200,000 (with typical assets) contribute a percentage of their annual income towards their child’s education, on a sliding scale that begins at 1% and moves toward 20%.

Other Elite Schools

Duke University (Durham, North Carolina)

Beginning with the fall 2023 semester, Duke will provide full tuition grants for undergraduate students from North Carolina and South Carolina whose family incomes are $150,000 or less. For North and South Carolina residents, students whose families earn $65,000 or less will receive full tuition, plus financial assistance for housing, meals, and other campus expenses, and there’s no expectation they will need to take out loans.

Massachusetts Institute of Technology, or MIT (Cambridge, Massachusetts)

MIT ensures scholarship funding for students whose family income is less than $200,000 (plus typical assets) so most can attend tuition-free. Furthermore, families earning under $100,000 can expect zero parental contribution toward their student’s total cost of attendance — including tuition, housing, dining, fees, and an allowance for books and personal expenses.

Rice University (Houston, Texas)

Students from families who earn less than $75,000 annually can attend Rice with an aid package that covers tuition, fees, and room and board. Students from families with annual incomes between $75,000 and $140,000 are awarded full-tuition scholarships, and students from families earning between $140,000 and $200,000 will receive scholarships covering at least half of their tuition.

Stanford University (Stanford, California)

Stanford does not expect parental contribution toward educational costs for students whose parents earn a total annual income below $100,000 and typical assets. Students are expected to contribute toward their own expenses — usually around $5,000 — from their summer income, part-time work during the school year, and their own savings. Students from families who earn less than $150,000 per year plus typical assets can typically attend Stanford tuition-free.

Texas A&M University (College Station, Texas)

Texas A&M covers both tuition and fees for students whose family income is $60,000 or less. Tuition support grants, ranging from $500-$1,500, are awarded based on income and financial need.

University of Chicago (Chicago, Illinois)

If your family’s adjusted gross income is less than $125,000, you’re eligible to receive free tuition to the University of Chicago. If your family’s AGI is less than $60,000, the school will also cover room, board, and other fees.

University of North Carolina (17 campuses across North Carolina)

As of fall 2024, UNC covers tuition and mandatory fees for North Carolina students whose families earn less than $80,000 annually and have typical assets. Students from families with a total income that is at or below 200% of the poverty guideline and who meet additional economic criteria to qualify can attend UNC debt-free thanks to the Carolina Covenant aid program.

Vanderbilt University (Nashville, Tennessee)

Vanderbilt’s Opportunity Vanderbilt initiative, expanded in February 2024, guarantees a full‑tuition scholarship — without loans — for all U.S. undergraduate students from families earning $150,000 or less (assuming typical assets), and often extends additional grant support for living expenses beyond tuition.In practice, families in lower income brackets often receive awards surpassing full tuition — measured median aid ranges from about $75,000 to $95,000, depending on income tier.

Financing Your Education If You Don’t Qualify For Free Tuition

Not all students will qualify for or attend a school that offers free tuition. There are several options for financing college.

Tuition Payment Plans

Students and their parents may be able to take advantage of a tuition payment plan, which allows you to break up the cost of tuition, room, and board, over the course of a semester or year.

Scholarships and Grants

Scholarships and grants are often referred to as “gift aid,” because you don’t typically have to pay back scholarships or grant money after graduation as you do with student loans.

Scholarships are often offered based on merit, while grants are typically based on financial need. Gift aid can come from different types of institutions — from your college to local community organizations to large corporations.

Recommended: A Guide to Unclaimed Scholarships and Grants

Student Loans

Unlike scholarships and grants, you do have to repay student loans upon leaving school or graduating. Student loans are split into two broad categories: federal and private loans.

Federal student loans are disbursed by the government, which sets fixed rules about repayment and interest rates. You apply for these loans by filling out the FAFSA.

Private financial institutions may provide private student loans. Each private loan company sets its own repayment requirements and determines their own interest rates. You apply for these loans directly through the lender.

Private student loans are generally considered as an option only after all other sources of aid have been exhausted. This is because they lack the same borrower protections as federal student loans, such as income-driven repayment plans or the option to pursue Public Service Loan Forgiveness.


💡 Quick Tip: Even if you don’t think you qualify for financial aid, you should fill out the FAFSA form. Many schools require it for merit-based scholarships, too. You can submit it as early as Oct. 1.

The Takeaway

There are a number of schools that offer free tuition plans or substantial financial assistance to students. Free tuition programs can make higher education more accessible to lower-income students. As mentioned, some schools may have requirements around work-study, academics, or living on campus for students to qualify for free or reduced tuition.

Students who aren’t enrolled in a school that offers free tuition have a few options for financing their education. This includes savings, federal financial aid, scholarships, and federal 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

Do any states have free college tuition?

Several states offer free college tuition programs, including New York, Tennessee, Oregon, and Rhode Island. These programs typically have specific eligibility criteria, such as income limits or residency requirements, and may cover community college or public university tuition.

How can you go to college with no money?

To attend college with no money, explore options like scholarships, grants, federal work-study programs, and community college. Consider applying for financial aid, seeking part-time jobs, or enrolling in free tuition programs offered by some states.

Do any Ivy League schools have free tuition?

Harvard recently announced that tuition will be free for students from families making less than $200,000 per year. Several other Ivy League schools provide significant financial aid to eligible students, covering full tuition for those with low family incomes. Princeton and Yale are among the institutions with generous need-based aid programs.

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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.

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Americans now hold a total of $1.77 trillion in student debt (including federal and private loans). For many people, educational loans are the biggest debt burden they’ll ever face, and the prospect of having to pay them off can seem overwhelming.

Figuring all this out can be hard on your own. Fortunately, there are counseling services available to help you navigate student debt no matter what stage of the process you are in.

Here’s a look at how student loan counseling works and how to determine the best path for managing student loan debt.

What Not to Do If You Need Student Loan Help

The worst thing you can do if you need help with your student loans is to stop making payments on them. Not making payments can lead to student loan default.

Defaulting has serious consequences, including a major hit to your credit score, possible wage garnishment, loss of eligibility for federal benefits, and more.

Instead, regardless of your current situation, a solid plan can help you tackle your student loans in a way that fits your circumstances and goals.


💡 Quick Tip: Some lenders help you pay down your student loans sooner with reward points you earn along the way.

What Is Student Loan Entrance Counseling?

Student loan entrance counseling is a mandatory exercise designed to inform federal loan recipients of their loan terms and responsibilities as borrowers. More specifically, the session covers student loan interest rates, repayment options, and the repercussions for default.

The Department of Education’s online module includes five sections with a range of loan-specific and financial topics, while schools have some discretion in how they deliver counseling sessions.

This requirement has been in place since the Federal Direct Loan program was created in 1992 with the goal of reducing delinquency.

When Do I Go For Student Loan Counseling?

If you’re borrowing federal student loans for the first time, student loan entrance counseling is a prerequisite for accessing funds. Therefore, it’s important to complete the session before the first loan disbursement.

Borrowers with Direct Subsidized and Unsubsidized Loans, as well as graduate students taking out Direct PLUS Loans, are required to participate in student loan entrance counseling. Students may be obligated to take additional entrance counseling at their chosen school, too, so be sure to check with the financial aid office.

Where Do I Go for Student Loan Counseling?

Whether you have federal or private student loans, there are services available to help you with financial wellness, budgeting, and understanding your loans. You can access student loan counseling at the following servicers:

Federal Student Loan Counseling

Before federal loans are disbursed, the government requires borrowers to complete student loan entrance counseling to understand their rights and what’s expected of them. The process is automated and online, and it takes up to half an hour to complete.

Similarly, when students graduate or are enrolled less than half-time, they must complete exit counseling online. Don’t just do this to check the box. Student loan exit counseling is designed to help you establish a solid foundation for dealing with student loans.

Loan Servicers

The government contracts with several loan servicers to handle federal student loans. It should be relatively easy to get in touch with a servicer by phone, email, or even online chat. It’s in the companies’ best interest to make sure you make payments.

Their agents typically work with borrowers to help them understand their debt, figure out the best repayment plan, and process requests for deferment or forbearance. The quality of advice can vary, but this can be a helpful first step for getting answers to questions or getting on track with repayment.

National Foundation for Credit Counseling

Founded in 1951, the National Foundation for Credit Counseling (NFCC) offers financial counseling on various issues, including student loan debt. The group’s certified credit counselors work with people to help them understand the benefits and drawbacks of various student loan repayment plans, how to make payments affordable, whether consolidation makes sense for you, and how to reduce the overall interest you pay.

Counselors offer to provide a comprehensive plan for managing student debt, taking an individual’s entire financial situation into account, rather than looking at student loans in a vacuum. Though NFCC doesn’t provide services for free, fees are typically low or based on how much you afford.

Clearpoint

Clearpoint, a division of Money Management International, is a nonprofit agency that offers student loan counseling. Their counselors examine your overall financial situation and discuss the best way forward, including repayment plans, consolidation, or rehabilitation.

They say they may suggest a debt management program if you are also having difficulty with credit card debt. The debt management program has relatively low fees, and the group says it will remove or reduce fees for clients with financial hardship.

GreenPath

GreenPath, another nonprofit, offers to review all your loans and provide an “unbiased assessment” and a customized plan based on your situation.

The initial consultation is free, but they also offer a higher tier of service if you want more in-depth analysis. If you want them to serve as your advocate by contacting the loan servicer on your behalf, you’ll be charged a fee.

Why Is Student Loan Entrance Counseling Important?

Figuring out how to get a student loan is just the beginning. Repaying loans is a long-term responsibility not to be taken lightly. In fact, the average borrower takes around 20 years to pay off their student loans.

If you’re in the process of taking out student loans, you’ll want to make sure you fully understand what the total cost of the loan will be and what repayment will look like, including what your payments will be, when they will start, and how long they will last.

Student loan entrance counseling unpacks how interest accrues over time and best practices for managing repayment. This can help you minimize the total interest paid over the life of the loan and steer clear of late fees or default.


💡 Quick Tip: Would-be borrowers will want to understand the different types of student loans that are available: private student loans, Federal Direct Subsidized and Unsubsidized Loans, Direct PLUS Loans, and more.

The Takeaway

Student loan entrance (and exit) counseling is required for all federal student loan borrowers and is designed to inform borrowers of how student loans work, with the goal of minimizing the number of students who default on their student loans.

In addition, there are a number of nonprofit agencies that offer student loan counseling to borrowers who would like help navigating the student loan repayment process. Many of these organizations will offer some general student loan counseling for free, while more in-depth help typically carries a fee. Many private lenders will also offer guidance on repayment free or charge.

If you’re still in the process of financing for your education, you may want to explore tapping a variety of options, including federal financial aid and federal 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 credit counseling help with student loans?

Credit counseling can provide general financial advice and help you manage debt, but it typically doesn’t offer specific solutions for student loans. For specialized assistance, consider student loan counseling or contacting your loan servicer directly.

What happens if I don’t do student loan exit counseling?

If you skip student loan exit counseling, you might miss important information about repayment options, grace periods, and deferment. This could lead to misunderstandings, missed payments, and potential default, affecting your credit score and financial future.

What are the cons of student loan counseling?

Student loan counseling can be time-consuming and may not always provide personalized advice. Some students might find the information overwhelming or confusing, and there’s no guarantee it will prevent default or reduce debt significantly.

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SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student loans are not a substitute for federal loans, grants, and work-study programs. We encourage you to evaluate all your federal student aid options before you consider any private loans, including ours. Read our FAQs.

Terms and conditions apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. SoFi Private Student loans are subject to program terms and restrictions, such as completion of a loan application and self-certification form, verification of application information, the student's at least half-time enrollment in a degree program at a SoFi-participating school, and, if applicable, a co-signer. In addition, borrowers must be U.S. citizens or other eligible status, be residing in the U.S., Puerto Rico, U.S. Virgin Islands, or American Samoa, and must meet SoFi’s underwriting requirements, including verification of sufficient income to support your ability to repay. Minimum loan amount is $1,000. See SoFi.com/eligibility for more information. Lowest rates reserved for the most creditworthy borrowers. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change. This information is current as of 4/22/2025 and is subject to change. SoFi Private Student loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

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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.

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.

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.

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College can be expensive. According to the College Board, the average cost of tuition and fees at a four-year private nonprofit institution for the 2024-25 school year was $43,350.

While that number may inspire sticker shock, there are options for students looking to make college more affordable. Some cost-cutting strategies include taking AP classes in high school, starting out at a community college, living at home to save on room and board, and applying for a variety of scholarships.

Keep reading for a closer look at these (plus other) ways to cut expenses and save money on college.

Ways to Make College More Economical

1. Take Advantage of AP Credits

Taking Advanced Placement (AP) credits in high school could cut down on the overall cost of college. Here’s how: If you take an AP course and get a 3 or higher on the AP exam, colleges may count that class towards the overall credit hours you need to graduate.

The average cost of one credit hour at a public four-year college is $406 (the average cost per course is $1,218). The more credits you enter college with, the fewer total credits you typically have to pay for, and the quicker you can jump into more advanced courses. Early graduation is one way to make college more affordable.

Of course, not all schools accept all AP credits. Some ultra-competitive schools may not let you use AP courses to reduce the total number of credits you’ll need to graduate or to skip introductory level courses.

2. Start Out at a Community College

Where you choose to go to college can have a big influence on the overall cost. Some students may consider starting their college journey at a community college and then transferring to a four-year college or university to finish their degree.

One of the benefits of community college is that courses can be significantly less expensive than at a four year college. According to the College Board, the average cost for tuition and fees for a student attending a two-year, in-district public college was $4,050 during the 2024-25 school year.

3. Attend an In-State University or College

If community college isn’t the right fit for you, you might consider attending an in-state college or university. Typically, in-state tuition is more affordable than out-of-state tuition or tuition at a private college.

According to the College Board, the cost of tuition and fees for in-state tuition at a four-year public institution averaged $11,610 for the 2024-25 school year. For out-of-state students, that rose to $30,780. However, that is still significantly less than the average cost of tuition and fees for private four-year universities, which was $43,350.

4. Look into Regional Tuition Exchange Programs

Students who are attending a school in a nearby state can look into tuition reciprocity programs to see if their school offers anything. Reciprocal tuition is when states offer students from a partner state in-state tuition. For example, Minnesota and Wisconsin have a tuition reciprocity agreement. This is one avenue that allows out-of-state students to pay in-state tuition.

5. Commute to School and Live at Home

Room and board is another major expense for students living away from home. If you are attending a school near your home, you could consider living with your family a bit longer. Living at home can help students save a significant amount of money on college.

Recommended: How to Pay for College With No Money Saved

6. Live Off Campus

Living on-campus can have benefits like proximity to classes, friends, and extracurriculars, but on-campus living can be pricey. Depending on where your school is located and what the rental housing market is like, living off-campus may be less expensive than paying for on-campus housing.

Some schools might require first-year students, or even in some cases upper-classmen, to live on-campus. Others may not have these restrictions. Often, schools will publish information on what percentage of the study body lives on-campus vs. off-campus, which can help inform what popular living situations at that school are.

7. Apply for Financial Aid Early

Federal financial aid includes scholarships, grants, work-study, and federal student loans. Some aid is awarded on a first-come, first-served basis, so applying early could potentially help you qualify for more aid than if you had applied closer to the deadline.

To apply for federal financial aid, students are required to fill out the Free Application for Federal Student Aid (FAFSA®) annually. Schools may also use the information provided on the FAFSA to determine scholarship awards.

8. Choose the Right Student Loan

There can be a lot to consider when picking a student loan. There are two broad categories of student loans — private and federal. Federal loans are awarded to students based on information in their FAFSA. Private student loans are borrowed from individual lenders, such as banks, credit unions, or other financial institutions.

When evaluating your financial aid package, make note of the types of federal student loans you are awarded. For undergraduates, there are two main federal loans: unsubsidized and subsidized loans.

Direct Subsidized Loans

On Direct Subsidized Loans, the federal government covers the interest that accrues while you are enrolled in school at least half-time and during the loan’s grace period. These are awarded based on financial need. While it can seem minor, not having to pay interest on the loan for four or so years can significantly reduce the total cost of the loan.

Direct Unsubsidized Loans

For a Direct Unsubsidized Loan, the borrower is responsible for paying all accrued interest. Financial need is not a factor in qualifying for a Direct Unsubsidized Loan.

Private Student Loans

If you are exploring private student loans as an option to pay for college, know that they don’t always offer the same options or borrower protections as federal student loans. Individual lenders can set their own rates and repayment terms, so be sure to read the fine print before borrowing. In general, private student loans are considered an option only after all other sources of funding, including federal student loans, have been evaluated.

While considering private student loans, it’s a good idea to look at a few different lenders to find the best rate and terms for your personal situation. When making lending decisions, lenders will generally evaluate a borrower’s (or their cosigner’s) credit score and history, among other factors.

💡 Quick Tip: New to private student loans? Visit the Private Student Loans Glossary to get familiar with key terms you will see during the process.

9. Target Specific Scholarships

A scholarship is money awarded to students to help pay for school expenses, and it generally doesn’t need to be repaid. Because of this, applying for scholarships can go a long way in reducing the amount of money a student has to spend on college.

Scholarships can be awarded by the school, or by corporations, nonprofits or community organizations. Some scholarships are merit-based, while others may have non-academic criteria like a specific talent, heritage, gender, interest or field of study, or location.

There are scholarship search engines that aggregate information on scholarships and can make it easy to browse thousands of scholarships at a time and narrow them down to your specific interests. The application requirements may vary depending on the scholarship, so be sure to read the application and expectations completely.

10. Spend Less on Textbooks

According to the Education Data Initiative, the average full-time undergraduate student at a four-year public university pays $1,212 for books and supplies in one academic year. Textbooks alone can cost over $100 each. While you may only use them for a few months, if they’re required by your professors, it may be integral to passing your courses.

To save on textbooks, students have a few options. One is to buy a digital version of the book. Some textbook distributors offer e-versions of their books for a fraction of the price. Another way to save is to buy a used version of the textbook. Used books are often readily available at school bookstores or can be found online.

Some students may rent books. This is generally cheaper than buying a textbook, and when the class is done you can send the book back to the bookseller.

11. Opt Out of the Dining Plan

If you’re living off-campus and have a kitchen available to you, consider opting out of the meal plan offered by your school. These plans are often more expensive than buying and cooking your own food. Plus, if you are making your own meals, you have full control of what you eat.

Students who appreciate the convenience of the meal plan while living off-campus might opt for a less expensive plan. Schools generally offer different options for meal plans, such as unlimited plans and tiered plans based on meals per week.

Recommended: 11 Strategies for Paying for College and Other Expenses

The Takeaway

There are options to save money when it comes to paying for college. Before you even get to college, you might consider taking AP classes, which could potentially allow you to skip some intro level courses (and save on tuition). Another key factor in college affordability is the school you choose to attend. Some students may choose to go to an in-state school with a more affordable tuition. Other students may find that, thanks to a generous financial aid package, one of their other choices may be more affordable than they originally imagined.

The type of student loans you borrow can also impact the overall cost of your education. Federal loans offer benefits and borrower protections like flexible income-driven repayment plans. Students who still have gaps in funding can also apply for private student loans. These loans may come with higher interest rates but allow you to borrow more (typically up to the full cost of attendance) than you can access with federal 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

Why is college so unaffordable?

College is unaffordable due to rising tuition costs, reduced state funding, and increased demand for higher education. Administrative expenses, infrastructure upgrades, and the need for specialized faculty also contribute. Student debt has become a significant burden, making affordability a pressing issue.

What are some ways to make college more affordable?

To make college more affordable, consider applying for scholarships, grants, and financial aid. Attend community college first, then transfer. Choose in-state public universities, work part-time, and explore online courses or tuition-free programs.

Is college worth the cost anymore?

College can still be worth the cost for many, offering higher earning potential, career opportunities, and personal growth. However, it depends on your field of study, the institution, and your financial situation. Weigh the benefits against the potential debt and consider alternatives like trade schools or online courses.

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SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student loans are not a substitute for federal loans, grants, and work-study programs. We encourage you to evaluate all your federal student aid options before you consider any private loans, including ours. Read our FAQs.

Terms and conditions apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. SoFi Private Student loans are subject to program terms and restrictions, such as completion of a loan application and self-certification form, verification of application information, the student's at least half-time enrollment in a degree program at a SoFi-participating school, and, if applicable, a co-signer. In addition, borrowers must be U.S. citizens or other eligible status, be residing in the U.S., Puerto Rico, U.S. Virgin Islands, or American Samoa, and must meet SoFi’s underwriting requirements, including verification of sufficient income to support your ability to repay. Minimum loan amount is $1,000. See SoFi.com/eligibility for more information. Lowest rates reserved for the most creditworthy borrowers. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change. This information is current as of 4/22/2025 and is subject to change. SoFi Private Student loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

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.

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.

Third Party Trademarks: Certified Financial Planner Board of Standards Center for Financial Planning, Inc. owns and licenses the certification marks CFP®, CERTIFIED FINANCIAL PLANNER®

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Savings accounts can be a good place to stow extra cash and build wealth, but unlike checking accounts, you usually can’t spend straight from a savings account. What’s more, you may find that there are limitations on the number of withdrawals or transfers you can make from out of your savings account.

If you want to avoid getting entangled with savings account rules and restrictions or triggering fees, here’s advice on spending money from a savings account.

How Does a Savings Account Differ From a Checking Account?

You might think the main difference between a checking account and a savings account is how you view them — namely, one is for spending now, and one is for using later. But the bank also views these two accounts very differently. Here’s a closer look at how savings accounts work vs. checking accounts.

•  Savings accounts typically earn interest while checking accounts generally earn zero or very little interest.

•  Savings accounts may come with cash transfer and withdrawal limits. A federal rule called Regulation D used to limit certain types of transactions from a savings account to no more than six per month. While this rule was lifted during the pandemic, some banks still enforce the six-per-month cap on savings account transactions.

•  Savings accounts don’t usually come with debit cards that can be used to make purchases with money from that savings account. Only a few banks offer this service.

Can You Write a Check From a Savings Account?

Typically, you can’t write checks from a savings account. Of course, it’s always possible to transfer money from a savings account to a checking account and then write a check from there.

If you want to save money and have the ability to write a check with the money you save, you may want to consider opening up a money market account.

Money market accounts are a type of savings account that often pay a higher interest rate than traditional savings accounts and generally include check-writing and debit card privileges.

However these accounts often come with minimum monthly balances, and falling below the minimum can trigger fees. Like other savings accounts, money market accounts may limit transactions to six per month (which includes writing checks and debit card payments).

How to Spend (and Save) With a Savings Account

To take advantage of the interest you’re earning on your savings and avoid triggering penalty fees or the closure of your account, you may want to keep these savings account spending tips in mind.

Keeping Track of Your Withdrawals

It can be a good idea to find out what your bank’s policy is regarding monthly transactions from savings. Many institutions are sticking with the standard limit of six “convenient transactions” per month, while some are allowing more, such as nine transactions per month.

Convenient transactions include money transfers you make online, by phone, or through bill pay. Transactions, including ATM withdrawals and those that you make in person at the bank, do not typically count towards the monthly cap.

Paying Bills From Your Checking Account

Scheduling automatic bill payments from your savings account may put you over the savings withdrawal limit. It can be a better idea to have automatic bill payments or recurring transfers come out of your checking account.

Withdrawing Money Only for Large Expenses

If you withdraw money from your savings account for everyday spending, it can reduce the amount of interest you earn and make it harder to reach your savings goals.

It can be wiser to only touch your savings when it’s necessary to cover an emergency expense or a large purchase (ideally, one you’ve been saving up for).

Building Your Savings

A savings account can help you work towards your financial goals, such as creating an emergency fund, making a downpayment on a home, or going on a great vacation. In some cases, you may even want to have different savings accounts for different goals. High-yield savings accounts can be especially useful for this purpose, especially if you establish them at online banks, which often have no or low fees.

To help achieve those goals faster, you may want to set up an automatic transfer from your checking account into your savings account on the same day each month (perhaps after your paycheck gets deposited). It’s perfectly fine to start slowly. Even small monthly deposits will add up over time.

Maximizing the Interest You Earn

The higher the interest rate, the faster your savings will grow. That’s why it can be worthwhile to do some research into which institutions and which types of savings accounts are paying the highest rates.

Some options you may want to look into include: A high-interest savings account, money market account, certificate of deposit (CD), checking and savings account, or an online savings account.

Recommended: Savings Account Interest Calculator

The Takeaway

Savings accounts generally aren’t designed for making frequent transactions. Instead, their main purpose is to provide a safe place to store money and grow wealth via the interest earned. To make the most out of your savings account, you may want to look for a high-yield savings account which offers higher interest than standard accounts.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with eligible direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.

Better banking is here with SoFi, NerdWallet’s 2024 winner for Best Checking Account Overall.* Enjoy 3.30% APY on SoFi Checking and Savings with eligible direct deposit.

FAQ

Can you spend directly from your savings account?

You usually can’t spend directly from a savings account. Savings accounts are a secure place to keep money and earn interest, while checking accounts are designed for spending.

Can I use my savings account to pay for things?

Usually, you use your checking account to pay for things. That’s why checking accounts typically come with a debit card and checks. In order to pay for things with funds in your savings account, you may have to transfer the money into your checking account first.

Is there a limit on transactions from my savings account?

Some banks may limit how many transactions you can complete each month from a savings account. There used to be a six transaction limit but, during the pandemic, this guideline was lifted, but some financial institutions still enforce it. Check with your bank to learn if your account has a cap on monthly transactions.

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About the author

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SoFi Checking and Savings is offered through SoFi Bank, N.A. Member FDIC. The SoFi® Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.

Annual percentage yield (APY) is variable and subject to change at any time. Rates are current as of 12/23/25. There is no minimum balance requirement. Fees may reduce earnings. Additional rates and information can be found at https://www.sofi.com/legal/banking-rate-sheet

Eligible Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Eligible Direct Deposit”) via the Automated Clearing House (“ACH”) Network every 31 calendar days.

Although we do our best to recognize all Eligible Direct Deposits, a small number of employers, payroll providers, benefits providers, or government agencies do not designate payments as direct deposit. To ensure you're earning the APY for account holders with Eligible Direct Deposit, we encourage you to check your APY Details page the day after your Eligible Direct Deposit posts to your SoFi account. If your APY is not showing as the APY for account holders with Eligible Direct Deposit, contact us at 855-456-7634 with the details of your Eligible Direct Deposit. As long as SoFi Bank can validate those details, you will start earning the APY for account holders with Eligible Direct Deposit from the date you contact SoFi for the next 31 calendar days. You will also be eligible for the APY for account holders with Eligible Direct Deposit on future Eligible Direct Deposits, as long as SoFi Bank can validate them.

Deposits that are not from an employer, payroll, or benefits provider or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, Wise, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Eligible Direct Deposit activity. There is no minimum Eligible Direct Deposit amount required to qualify for the stated interest rate. SoFi Bank shall, in its sole discretion, assess each account holder's Eligible Direct Deposit activity to determine the applicability of rates and may request additional documentation for verification of eligibility.

See additional details at https://www.sofi.com/legal/banking-rate-sheet.
*Awards or rankings from NerdWallet are not indicative of future success or results. This award and its ratings are independently determined and awarded by their respective publications.

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.

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