Angelica Melendez said no one guided her through the process of applying and paying for college. She couldn't turn to her parents because they never went to college and didn't know the process either. As a result, she made costly mistakes.
She took out more student loans than she needed. She put herself at risk of losing credits by transferring schools at least twice. And it took her about eight years to graduate in part because she stopped going to college for a few years to work.
Despite these challenges, Melendez graduated from Texas A&M University and is now a college and financial aid specialist at South San Antonio High School. She uses her personal experiences to teach high school students about the best ways to pay for college so that they don't make the same mistakes she did.
"I never had anyone do that for me, so that's been a personal goal of mine—to help students," she said.
Apply For Scholarships
One of the best ways to pay for school, Melendez said, is through scholarships. She advises students to apply for national scholarships, like the Hispanic Scholarship Fund, as well as smaller scholarships given out by community organizations or local businesses.
"I tell students, 'Yes, shoot for the big ones. But you can also make your own big scholarship with a bunch of little ones,'" she said.
But with the rising cost of tuition, scholarships may not be enough to cover the cost of a college education. Students and their families may need to turn to student loans.
According to the College Board, the average cost of tuition and fees plus room and board at public four-year colleges and universities during the 2014-2015 school year was $18,943 for in-state residents and $32,762 for out-of-state residents. For students attending private colleges it was $42,419, and it can go as high as more than $50,000 a year.
On Loans, Borrow Wisely
Melendez said that if students are thinking about taking out student loans, they should only borrow the amount that they need. It's important to pay attention to the interest rates and repayment policies of each loan so that they can graduate from college with as little debt as possible.
"Unlike other debt, this stuff doesn't go away," she said, noting that student loans are not dischargeable in bankruptcy. "That's why you have to borrow wisely."
Federal student loans are usually the better choice for students with financial need, because they have lower interest rates and allow students to begin repayment several months after they graduate or stop going to school. Subsidized federal loans are also a good option, because the government pays the interest on the loan while students are in school.
Private student loans, on the other hand, are usually more expensive and offer less flexible repayment options. Some even require payments while students are still in school. Students are often advised to max out the amount in federal loans they can borrow before taking out private loans.
Don't Forget FAFSA
To apply for federal loans, students must complete the Free Application for Federal Student Aid (FAFSA), which asks students to detail their family's financial information to determine how much federal aid they qualify for. FAFSA also gives students access to other types of financial aid like Pell Grants, which don't need to be repaid.
Sarah Audelo, policy director for Generation Progress, said filling out the FAFSA is the first step high school students should take to get help paying for college. She noted that many colleges use the FAFSA information to determine a student's financial need and to put together a financial aid package for them.
But the problem is that "we're not seeing enough low-income students fill out the FAFSA " Audelo said. "We need our students to fill out the FAFSA to figure out how much financial aid they can get."
A recent analysis titled "Leaving Money on the Table" found that about 2 million students could have qualified for Pell Grants—averaging about $4,700 each—during the 2011-2012 school year (the most recent data available) if they had filed the FAFSA. They could have also qualified for state and institutional grants—averaging about $1,400 each.
Almost half of all of those who didn't file the FAFSA during the 2011-2012 school year said they thought they were ineligible, according to the analysis. Other reasons for not filing the FAFSA: nearly 38 percent said they thought they had no demonstrated financial need, 34 percent said they did not want to take on debt, 13 percent had no information on how to apply and 9 percent said application forms were too much work.
The analysis also found that it pays to file the FAFSA early. Students who file the FAFSA in January, February or March on average receive more than twice as much in financial aid than students who file it later.
For-Profit Colleges Are More Expensive
Audelo said it's also important for students to be aware of for-profit colleges, which tend to charge twice as much as public institutions.
"They're really expensive," she said. "You can get the same degree for a significant amount cheaper by going to a community college or a four-year university."
For-profit colleges have grown in popularity over the last few years. Their alternative learning environments and flexible class schedules have made them attractive to students, especially those who work.
But a 2014 report by the Center for Responsible Lending highlighted concerns regarding the success of for-profit college graduates in finding jobs, as well as the large amounts of debt students accrue at these schools. The report also noted that for-profit colleges enroll a disproportionate number of Latino and African American students.
Aim High - Selective Schools Want More Latino Students
Latino students are underrepresented at some of the nation's most selective colleges and universities. But Rick Cruz, assistant superintendent of college readiness for the Houston Independent School District, is trying to change that. He encourages Latino students to aim for top-tiered schools, including prestigious liberal arts colleges and Ivy League schools.
Cruz, who is a Yale graduate, explained that selective schools - with their ample endowments - can provide substantial financial aid packages for students who come from low-income families. Unfortunately, many high-achieving Latino students automatically think these schools are "out of reach" when they see the annual tuition cost of about $60,000—which is usually more than what their families make in a year.
"They don't realize that if you demonstrate that you have what it takes to be successful there and the college accepts you, they'll take care of you financially and you'll graduate with less debt and with a degree from a fantastic institution that's going to open doors," he said.
Cruz is spreading the word about these more selective schools through a program called Emerge, which he co-founded in 2010 while he was a fifth-grade bilingual teacher. The first cohort of the program was made up of about a dozen high school students. Over the last few years, he has helped students get financial aid packages worth about $250,000 each to attend some of the nation's top colleges and universities.
In February 2014—after seeing how successful the program was in sending low-income, high-achieving students to top-ranked schools—the Houston Independent School District hired Cruz to expand the program district-wide. Next year, more than 600 high school students in about 45 schools are expected to be part of the program.
"We want to make sure that we're signing students up for success so that they can attend the best possible schools that are aligned to their interests but also give them sufficient financial aid," Cruz said.
Start Planning Before School Starts
During these summer days, high school students and their families have an opportunity to start planning. Students can apply for scholarships and colleges as early as their junior year. To have a better shot at getting more financial aid, most colleges encourage students to submit their applications by December. At the same time, students who file the FAFSA soon after January 1—when the application is made available—will also improve their chances of getting more financial aid.
These and other deadlines will come quickly; so the sooner students start planning, the better.