By Alex Pabellon, CPA, CGMA

U.S. News & World Report estimates that the average cost to attend public universities has increased 6.5 percent each year for the past 10 years, and that over the next 11 years the total cost for a four-year degree will reach about $205,000. Clearly, it’s time to get creative about how we finance our education. These conversations are not easy, but if you avoid having them it could spell financial catastrophe. Below are several ideas to consider when planning for college. Before we can evaluate these options, we need to understand the problem.

Academic and Professional Goals

It is difficult to start a discussion about college financing without first knowing what the student hopes to obtain from such an investment. Most hope to gain a set of skills that will help them achieve their expected careers. Therein lies the first piece of the problem: Is the student’s goal to be a professional or an entrepreneur? Or is the student leaning toward a trade or vocation that requires specialized training or an apprenticeship rather than a four-year degree? Many excellent jobs require a skill, not a degree. Heating, plumbing, and lighting are things that everyone needs but not everybody knows how to provide. There are about 6 million of these good jobs currently open, and a job in one of these fields could mean a long-term career, a springboard into something different, or provide a means to pay for college later. One great resource is the U.S. Department of Labor, which provides statistics that help predict future job growth in various industries as well as resources to help guide a career choice. Finally, get insight from friends and family in different industries. Find out from them how they see their particular field performing and what opportunities they identify for future growth.

Lower College Costs

After looking at the options, if you determine that college is the best avenue to meet personal and professional goals, you need to have conversations about paying for college. These will help you develop strategies for reducing the cost of college and avoiding the burden of astronomical student debt.

Home State Discounts – For many, college can be a place to find oneself and begin an independent life. But that doesn’t mean the college experience needs to be out of state. Out-of-state tuition is significantly more expensive – sometimes as much as 50 percent more expensive – than in-state tuition. Most states have several school choices for most career paths.

Consider Community College to Start – Community colleges may not have a glamorous sports program, but they do offer another opportunity to save. Many community colleges have strong relationships with neighboring four-year schools. Discussions with academic advisers from both institutions in your area can ensure that all, or almost all, general education credits transfer. Community college tuition is significantly lower than university tuition, and you can save thousands every year without delaying graduation.

Commute to School – Room and board can account for over a third of all college costs. There are significant savings to be realized by either commuting to school or completing some or all coursework online. It may subtract from the college experience many students dream about, but it will definitely subtract tens of thousands of dollars from the amount needed for college.

Explore Your Financial Aid Options – You never know what aid is available if you don’t spend some time browsing your institution’s financial aid site, speaking to representatives on campus, and filling out applications. Pell grants, scholarships, and subsidized loans are some of the options that might be available, so it’s always worth exploring all options.

After you identify strategies to keep costs down, it’s time to figure out how best to pay for your college education.

Structure a Financing Plan

Parents wishing to help children pay for college face a series of challenges. They may have other financial priorities, such as supporting multiple dependents and saving for retirement. This is especially important for those parents nearing the end of their earning years and who haven’t accumulated sufficient savings for retirement. Others may just not have the resources. Nevertheless, there are always options.

Financing College with a Job – This option may be the most difficult, but it’s the one that I chose. I entered the workforce, full time, as a 17-year-old high school graduate. Living with my parents for a few years allowed me to put most of my meager salary into my education. I graduated debt-free and with several years of relevant work experience on my résumé. I won’t lie: it was really difficult. But I benefited from it so much that I’d be doing you a disservice by not including it here as an option.

Explore Employer Tuition Reimbursement – Having an employer reward you with a salary, relevant work experience, and tuition reimbursement is hard to beat! There really isn’t a reason not to try to pursue this option. Employers often require a commitment to stay a certain number of years after having paid for your education, but these arrangements are usually prorated for time spent, which can still result in significant savings should you decide to leave. If you work, find out if you have a tuition reimbursement plan, what’s reimbursable, what’s not reimbursable, and whether there is an annual maximum.

Start Saving with a 529 Plan – A 529 account is a tax-advantaged plan that allows taxpayers to save up to $10,000 each year per student toward qualified educational expenses. Taxpayers can contribute pretax dollars similar to contributing toward an IRA or 401(k). Parents wishing to contribute should start early.

Start Saving Early – Using a blend of investments targeting a modest 7 percent growth, with a relatively small investment of $1,200 each year ($100 per month) for 18 years, would grow to about $41,000. That might seem modest compared to the high cost of tuition per year, but that amount in conjunction with the other cost-savings and financing strategies outlined above will go a long way to providing a quality education.

Leverage the Power of Crowdfunding – We’ve all gotten a holiday or birthday present that we had to return. Why do this retain dance? Guide family, friends, and colleagues to make gifts toward your education or your child’s education instead. If they contribute to savings or investment plans along with you, the funds will grow faster over time.

Why did I not mention college loans? They are an option, but they are the typical option. For younger generations, job skills cost more and job security is fleeting. Starting salaries for college graduates hover around $50,000 per year, and costs are outpacing both inflation and wage growth. For these reasons, indebtedness is a much less attractive option. If loans are still necessary, exhaust all government subsidized financing first, then try credit unions and banks. Do not put books and tuition on a credit card. This could result in a financial trap that’s difficult to recover from.

Take control of your academic and financial future by planning early. Speak with your CPA about tax-advantaged savings and investment plans. Talk to financial planners about your savings priorities, and make sure you are in a position to save for college. Don’t wait until both parents and students are overwhelmed with voices from all angles, including those with a vested interest in directing you toward the expensive route to college.

It is possible to have college without a financial catastrophe.

Alex Pabellon, CPA, CGMA, is manager of accounting policy and SEC reporting at Customers Bancorp in Wyomissing, Pa.