Jan
26
2026

Best Scholarships for High School Juniors: Class of 2026

By | Going to College, Student Loans, student_loan | Comments Off on Best Scholarships for High School Juniors: Class of 2026

With average annual tuition and fees reaching $11,260 for in-state students at public four-year colleges and $41,540 for private universities, covering college expenses can feel overwhelming. Scholarships for high school juniors may be just what you need to make college more affordable.

Whether you’re aiming for a four-year university or a community college, there are plenty of scholarships designed specifically for high school juniors in the class of 2026. Unlike student loans, scholarships are free money for college and don’t need to be paid back.

Keep reading to learn about some of the best scholarships available for high school juniors and how they can help you take that next step toward your college career.

Key Points

•   Scholarships can help high school juniors reduce college costs without needing repayment.

•   Merit-based awards often require strong academic performance, leadership roles, or community service.

•   No-essay scholarships, like sweepstakes and video-based awards, are easier to apply for but highly competitive.

•   Top scholarships include the United States Senate Youth Program, Voice of Democracy, and Create-a-Greeting Card Contest.

•   Applying early and to multiple scholarships increases the chances of receiving financial aid for college.

How Do I Qualify for High School Junior Scholarships?

To qualify for scholarships as a high school junior, start by maintaining strong academic performance, since many scholarships are merit-based and require a minimum GPA.

Research scholarships that match your interests, background, or intended college major. You should also try to participate in extracurricular activities, leadership roles, and community service, which are often key factors for many scholarship applications.

Some scholarships may also consider financial need, requiring you to submit the Free Application for Federal Student Aid (FAFSA). Additionally, sign up and prepare for standardized tests like the SAT or ACT, because scores can be a qualifying factor for many awards. Keep deadlines in mind and apply early.

Recommended: What Types of Scholarships Are There?

How to Find Scholarships for High School Juniors

While you’re completing your junior year, there are plenty of resources to help you find scholarships, including:

•   The financial aid office at the college or career school you’re considering

•   Organizations and professional groups connected to your interests

•   Federal agencies that offer financial aid

•   Free scholarship search tools, like the Scholarship Search Tool by SoFi

•   Local organizations, such as libraries, businesses, nonprofits, and other community groups

It’s important to understand that not all scholarship opportunities are legitimate. For example, it’s probably a red flag if someone asks you to pay to apply or find scholarships. Remember that you should never have to pay to enter a scholarship, so it’s best to avoid those kinds of offers.

What Is the Easiest Scholarship to Get in High School?

While some scholarships require a good amount of work, like writing essays or gathering recommendation letters, others are much easier to apply for. For example, no-essay scholarships are often the easiest to apply for because they typically have minimal requirements, such as being a certain age.

There are two main types of no-essay scholarships: sweepstakes and video scholarships. With sweepstakes scholarships, you don’t typically need to submit grades, test scores, or essays. Instead, you might just need to fill out a short form, provide some basic information about yourself, or answer a few questions.

Keep in mind that since these scholarships are easier to apply for, there’s often more competition, which can lower your chances of an award. Even though junior year is busy, it’s a good idea to apply to as many as you can to boost your chances of receiving a no-essay scholarship.

On the other hand, video scholarships require you to create something, like a five-minute video explaining why you deserve an award. For some, this may be easier than writing an essay and gives you a different way to showcase your strengths.

Recommended: Enter SoFi’s Scholarship Giveaway for $2,500

Best Scholarships for High School Juniors

Here are some of the best scholarships for high school juniors to apply for in 2026 and 2027:

1. United States Senate Youth Program

Award: $10,000

The United States Senate Youth Program (USSYP) is open to high school juniors and seniors interested in a career in public service. Applicants must demonstrate leadership skills by serving in an elected or appointed role, such as student government, education, public affairs, or community service.

2. G2 Overachievers Student Grant

Award: $15,000

The G2 Overachievers Student Grant is for middle and high school honor roll students between the ages of 13 and 19. To apply, you must submit a 1,000 to 2,000 word handwritten essay about how you (or the person you’re nominating) are making a difference in your community and deserve to be recognized for it.

3. The Christophers High School Poster Contest

Award: $1,000

U.S. high school students, from freshmen to seniors, can enter the Christophers 35th Annual Poster Contest. To apply, simply create a poster featuring the phrase “You can make a difference” and illustrate how one person can positively impact the world.

4. Create a Greeting Card Scholarship Contest

Award: $10,000

The Create-a-Greeting Card Scholarship Contest is open to all U.S. high school and college students that are 14 years and older. To enter, simply create an original greeting card design. Your design can be a Christmas card, holiday card, birthday card, or an all-occasion greeting card.

5. Voice of Democracy Scholarship Competition

Award: $35,000

High school students can win the Voice of Democracy award by submitting a three- to five-minute audio essay on the topic “Is America Today What Our Forefathers Imagined?” The Veterans of Foreign Wars (VFW) also offers other scholarships, with awards ranging from $1,000 to $21,000.

6. We the Future Contest

Award: $2,000 – $5,000

High school students starting in freshman year can win the We the Future Contest by creating a 500-700 word essay, song, STEM project, short film, social media video, or public service announcement (PSA) on a Constitution-related topic.

7. Carson Scholars Fund

Award: $1,000

The Carson Scholars Fund is for students in grades four through 11 who do well in school and are committed to making a difference in their communities. To apply, you need a GPA of at least 3.75 and must show a strong commitment to community service.

Carson Scholars Fund

8. International Public Policy Forum (IPPF)

Award: $10,000

The Brewer Foundation and New York University (NYU) offer the International Public Policy Forum award to teams of at least three students from the same school. As a team, you’ll write a 3,000-word essay on “Resolved: Equitable access to pharmaceuticals should be prioritized over protecting intellectual property rights.” The top 64 teams will move to a written round, and the top eight teams will compete in a final oral debate.

Recommended: How to Pay for College

The Takeaway

Kicking off your scholarship applications during junior year gives you a head start and helps you find more options to pay for college. The more scholarship money you earn, the less you’ll need to pay in tuition and other expenses.

In addition to scholarships, students can pay for college with cash savings, 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

Should you start applying for scholarships as a junior?

Even though your junior year is a good time to apply for scholarships, you don’t need to wait until then. You can start anytime in high school, which gives you a jumpstart and can open up more scholarship opportunities.

What is the youngest age you can get a scholarship?

You might be able to find scholarship opportunities for kids as young as the age of four. While this may seem a tad early, starting as soon as possible gives you more time to plan for future college costs.

What are the most sought after college scholarships?

Some of the most sought-after scholarships include The Gates Scholarship and the Coca-Cola Scholars Program. However, these popular scholarships are usually available only to high school seniors and can be pretty competitive. So, to increase your chances of winning, it’s a good idea to apply for a mix of different scholarships.

About the author

Ashley Kilroy

Ashley Kilroy

Ashley Kilroy is a seasoned personal finance writer with 15 years of experience simplifying complex concepts for individuals seeking financial security. Her expertise has shined through in well-known publications like Rolling Stone, Forbes, SmartAsset, and Money Talks News. Read full bio.


Photo credit: iStock/shapecharge

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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.

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26
2026
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Student Loan Debt and Divorce: Does It Get Split?

By | Family Finances, Life & Career, Student Loans, student_loan | No Comments

Divorce is probably not the first word that comes to mind when you think about repaying your student loans.

But for married couples who are splitting up, debt — and who’s responsible for it — can be a very real factor in a divorce settlement. So how does student loan debt get split in divorce?

There isn’t one right answer to this question — it depends on countless factors, often including what state you live in, and when you took out the loan.

But first, we want to be clear that nothing in this article should be taken as financial or legal advice. This broad overview of student loan debt responsibility after divorce doesn’t take your unique circumstances into consideration, which is why we recommend discussing the specific details with a financial advisor or attorney.

That said, let’s look at divorce and student loan debt and what the impact might be in various circumstances.

Key Points

•   Divorce may complicate the division of student loan debt, influenced by state laws.

•   Loans taken before marriage typically remain the sole responsibility of the borrower.

•   Post-marriage loans may be considered marital property and split 50-50 in community property states.

•   In equitable distribution states, debt is divided based on fairness and what’s equitable, with courts considering factors like income.

•   If a spouse is a cosigner on a partner’s refinanced student loan, they are equally responsible for the loan.

Addressing Separate Student Loans

When it comes to student loans, divorce can make things tricky. Whether student loan debt gets split in a divorce depends on a number of factors, including who owns the loans and the state in which you live.

Determining Ownership Based on State Law

In a divorce, assets and debts are typically divided in part based on whether or not they are considered to be marital property, which can vary by state. You are typically responsible for loans taken out in your name before you were married, and likewise for your ex-spouse.

Debt in a divorce can get a little bit more complicated if you or your spouse took out a student loan after marriage. These loans may be considered marital property, depending on the laws in your state and the circumstances under which you took out the loans.

Community Property vs Equitable Distribution

When addressing marital property, states typically use either community property laws, in which property or debt taken on during a marriage is jointly owned (known as communal debt), or equitable distribution laws, where the property or debt belongs solely to the spouse who initiated the purchase or debt. In states with community property laws, marital assets and debts are split 50-50 between spouses.

Most states have equitable distribution laws, which can make dividing assets or debt a little more confusing. In these states, each spouse has a claim to an equitable share of marital property, which may or may not be divided equally.

Courts have final say over what’s fair and equitable. To determine that, they may look at each spouse’s income, earning potential, or the support one spouse provided while the other was in school, such as child care or even the opportunity costs of putting their own education on hold. Furthermore, if you or your spouse took out student loans to pay for an education that benefited you both, that could also be a consideration in court.

Recommended: Student Loan Debt Guide

Approaching Refinanced Loans

If you or your spouse have refinanced student loans, whose names the loans are in and whether one of you cosigned the other’s loan can determine who is responsible for the debt and how it may be separated in divorce.

Joint Refinancing and Liability After Divorce

Some couples may have combined their separate student loans into one big joint refinanced loan while they were married, though not all lenders allow this.

If you and your spouse have a joint refinanced loan, state law will typically dictate how it’s handled. In equitable distribution states, how the debt is divided by the courts may depend on your financial circumstances. In community property states, the courts decide whether the loan is communal debt and then split the debt evenly

Even if a couple did not refinance their loans jointly, they may have refinanced one partner’s loans with the other serving as the cosigner. For example, if one member of a couple wanted to refinance their loans but didn’t qualify, their spouse may have decided to cosign the refinanced loan in order to help them qualify for or secure a better rate.

When couples cosign on their partner’s loans, both spouses are on the hook for the debt. While this may work while a couple is together, it can make things complicated when your ex-spouse is the cosigner of your refinanced loan. This new loan is owned by the couple, and may be considered marital property subject to community property laws or equitable distribution laws.

Finally, if you have joint student loan consolidation of federal loans — a program that was discontinued by the Education Department in 2006 — there is a way to separate your joint loan obligation and reconsolidate into new individual Direct Consolidation Loans. You can learn more about the process from the Federal Student Aid office.

Steps to Separate Refinanced Loan Responsibility

To deal with divorce and student loan debt in the case of a loan that’s been refinanced, you can separate the responsibility for repaying the loan by refinancing the loan in the name of the spouse that is keeping the debt. If the debt is being split between both spouses, it may be possible for each spouse to separately refinance their share of the debt, but each will have to qualify with good credit and income, which can be difficult to get approval for. Not many lenders offer this option.

You may want to speak to an attorney in your state to help figure out the best way to proceed for your specific situation.

Paying Your Part

In cases where debt is considered marital property, divorcing couples on good terms can decide how to divide student loan debt and have a court sign off on it. However, in some cases, ex-spouses may simply not be able to take charge of dividing things up, and the court can decide how the debt will be divided instead.

At this point, you’re losing the power of a combined income to pay off your loans, so you may need to consider strategies to help the newly-single you afford your payments.

Refinance Your Student Loans

First, you may want to consider the option to refinance student loans to potentially secure a better rate or term. A better interest rate and shorter term might help you pay down your debt faster and could reduce the money you spend on interest over the life of the loan.

You can shop around for student loan refinancing rates to find the best rates and terms for your situation.

If you lengthen the term of your loan, you may be able to lower your monthly payments, which can help if your budget is strapped. However, longer terms typically mean you’ll end up paying more over the life of the loan.

Using our student loan refinancing calculator could help you see how much you might save.

Keep in mind that if you choose to refinance federal student loans with a private lender, you lose access to federal benefits, including income-driven repayment plans (discussed below) and student loan forgiveness.

Recommended: The Impact of Student Loan Debt

Use an Income-Driven Repayment Plan

Federal loans currently have income-driven repayment (IDR) options that can also help you lower your monthly payments. These income-driven repayment plans have you pay a percentage of your discretionary income, generally 10% to 20%, toward your student loans each month. And if you pay your loans off on one of the IDR plans, your remaining balance may be forgiven (though that forgiven balance will be taxed as income).

Remove Your Student Loan Cosigner, if Applicable

If you refinanced your student loans when you were married and your spouse was your cosigner, you could also consider refinancing a second time — as an individual. This could allow you to not only qualify for new loan terms or rates, but also ensure that your ex’s name is no longer tied to your student debt. You can calculate your student loan payments to help determine what you might pay with a new interest rate and/or term.

Communicate Changes to Your Loan Servicer

Once you’ve chosen a plan of action, it’s important to reach out to your loan servicer to let them know how you will be proceeding, so that they can update your account accordingly. There may be paperwork you’ll need to complete as well; be sure to find out what’s required.

How Divorce Settlements Can Affect Student Loan Repayment

The way your student loan debt is divided in divorce, and whether you live in a community property or equitable distribution state, determines how you or your ex — or both of you — can move forward with repaying the debt.

Including Student Loans in Divorce Agreements

Your divorce agreement or divorce degree should stipulate exactly who is responsible for repaying the student loan(s), as well as the plan for how it will be repaid.

Legal Support for Resolving Loan Disputes

If you and your soon-to-be ex can’t agree on how your student loan debt should be handled, you can get help from lawyers in your state that specialize in family law and the division of debt. Generally speaking, these legal professionals help negotiate settlements in a divorce and represent individuals in court. You may also want to consult an attorney who specializes in student loans, depending on your unique situation.

If you need help finding a lawyer, the American Bar Association has a lawyer referral directory you can consult, and LawHelp.org offers low-cost legal assistance for eligible individuals.

The Takeaway

Going through a divorce is difficult enough — figuring out who is responsible for student loan debt as you and your ex go your separate ways can make it even tougher. The state you live in and when the loans were taken out can help determine who owes what.

Repaying your student loans on a single income after divorce might call for ways to make it more affordable, such as using an income-driven payment plan or refinancing the loans. Explore the different options to decide what works best for your financial situation.

Looking to lower your monthly student loan payment? Refinancing may be one way to do it — by extending your loan term, getting a lower interest rate than what you currently have, or both. (Please note that refinancing federal loans makes them ineligible for federal forgiveness and protections. Also, lengthening your loan term may mean paying more in interest over the life of the loan.) SoFi student loan refinancing offers flexible terms that fit your budget.

With SoFi, refinancing is fast, easy, and all online. We offer competitive fixed and variable rates.

FAQ

Am I responsible for my spouse’s student loan debt if we divorce?

A spouse is typically liable for student loans taken out in their name before marriage. But if the loans were taken out after you were married, they might be considered marital property, depending on the laws in your state. If your state is a community property state, the student loans would generally be treated as jointly owned. If you live in an equitable distribution state, marital debt is divided by the courts based upon what they deem fair and equitable.

Does my spouse take on my student loan debt?

Your spouse does not typically take on your student loan debt for loans you borrowed before you were married. However, if you took out student loans after your marriage, your spouse might also be responsible for that debt.

What happens if I marry someone with a lot of student loan debt?

If you marry someone with a lot of student loan debt, the debt remains theirs alone, unless they refinance the loans with you as a cosigner. In that case, you are equally responsible for the debt. Your spouse’s student loan debt could also potentially impact your approval for any loans you apply for together, such as a mortgage, since the loan debt would be included in your debt-to-income ratio, which lenders use to help evaluate a borrower’s ability to repay a loan.

Can student loans be split in a divorce settlement?

Yes, student loans can be split in a divorce settlement, but whether and how it happens generally depends on the state you live in and when the loan was taken out. Loans borrowed before marriage are generally considered the responsibility of the individual who took them out.

If the loans were taken out after marriage and your state uses community property laws, the debt is jointly owned and split 50-50 in divorce. In states with equitable distribution laws, the debt is divided in a way a judge deems fair and equitable.

How do courts handle student debt in community property states?

In the nine community property states in the U.S., student debt taken out during a marriage is considered jointly owned, and it is divided equally between both spouses — even if the loan is in just one spouse’s name. If the loan was taken out before the marriage, the debt is generally considered the responsibility of the person who borrowed the money.

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Terms and conditions apply. SoFi Refinance Student Loans are private loans. When you refinance federal loans with a SoFi loan, YOU FORFEIT YOUR ELIGIBILITY FOR ALL FEDERAL LOAN BENEFITS, including all flexible federal repayment and forgiveness options that are or may become available to federal student loan borrowers including, but not limited to: Public Service Loan Forgiveness (PSLF), Income-Based Repayment, Income-Contingent Repayment, extended repayment plans, PAYE or SAVE. Lowest rates reserved for the most creditworthy borrowers. Learn more at SoFi.com/eligibility. SoFi Refinance Student Loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

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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.


Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.

This article is not intended to be legal advice. Please consult an attorney for advice.

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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Is There a Prepayment Penalty on Student Loans?

By | Fresh Out of School, Student Loans, student_loan | Comments Off on Is There a Prepayment Penalty on Student Loans?

Prepaying student loans can help you save on interest and become debt-free faster. Many loans, including federal and private student loans, allow prepayment without penalties, but it’s essential to understand how to make extra payments effectively.

Whether you want to pay down principal directly, make biweekly payments, or prioritize high-interest loans, prepayment strategies can significantly impact your financial future. This guide explores the benefits of prepaying student loans and how to ensure that your extra payments are applied correctly.

Key Points

•   Federal and private student loans in the U.S. allow prepayment without penalties, enabling borrowers to pay off their debt faster and save on interest.

•   Ensure that any additional payments are applied directly to the loan principal by specifying this with the loan servicer, reducing overall interest.

•   Prioritize extra payments toward loans with the highest interest rates to maximize savings over time.

•   Check accounts regularly and review monthly loan statements to make sure prepayments are being applied correctly.

•   Another way to potentially save money on student loans is by refinancing them, ideally with a lower interest rate. However, refinancing federal student loans makes them ineligible for federal benefits and protections.

What Is a Prepayment Penalty?

A prepayment is any extra amount you pay on your loans in addition to your regular required monthly payment. A prepayment penalty refers to fees you pay to your lender if you choose to make extra payments.

Generally, if you have private or federal student loans, you will not pay penalties if you prepay your student loans. In fact, lenders are banned from charging additional fees when you make extra payments.

If you’re planning (or hoping!) to pay off your loan in full, check with your loan servicer about the details and to get a payoff quote. A payoff quote is an estimate of how much you’ll need to pay in order to pay off the full loan amount.

Student Loan Prepayment Penalties

Borrowers who want to make prepayments may worry that there is a prepayment penalty on student loans. There isn’t — but here’s what to know.

Are Prepayment Penalties Common with Student Loans?

There are generally no prepayment penalties on student loans. Lenders are prohibited from charging prepayment penalties on federal or private student loans. The Higher Education Act of 1965 banned prepayment penalties for federal student loans. And in 2008, the Higher Education Opportunity Act (HEOA) amended the Truth in Lending Act (TILA), banning prepayment penalties for private student loans.

Why Lenders Might Discourage Early Repayment

Although they cannot charge prepayment penalties, some lenders might prefer it if borrowers didn’t pay their loans off early. That’s because the longer it takes to repay a loan, the more time interest accrues, and the more a lender might collect.

Additionally, for federal student loan borrowers who are repaying their loans on an income-driven repayment (IDR) plan or working toward student loan forgiveness, these programs typically require paying loans over a certain period of time, such as 20 to 25 years, or making a certain number of payments, like the 120 qualified monthly payments to achieve Public Service Loan Forgiveness, which generally takes at least 10 years. If a borrower repays their loans early, they miss out on the federal benefits, and the lender misses out on the money they may have earned over a longer loan term.

Prepaying Federal Student Loans

Federal student loans are loans lent to borrowers by the federal government; specifically, the Education Department. They include:

•   Direct Subsidized Loans: These loans are for eligible undergraduate students with financial need.

•   Direct Unsubsidized Loans: These are for eligible undergraduate, graduate, and professional students..

•   Direct PLUS Loans: These are for parents who want to borrow money for their dependent undergraduate students (Parent PLUS Loan) and for eligible graduate or professional students (Grad PLUS Loan).

•   Direct Consolidation Loans: Borrowers with eligible federal student loans who want to combine them into a single loan with one interest rate can opt for student loan consolidation.

Federal student loans go into repayment when you graduate, drop below half-time enrollment, or leave school

You’ll get a six-month grace period before you must make regular payments if you have Direct Subsidized, Direct Unsubsidized, or Federal Family Education Loans (FFEL). PLUS Loans require repayment upon disbursement unless you’re a graduate or professional student, in which case you’ll be placed on an automatic deferment while in school and for six months after graduating, leaving school, or dropping below half-time enrollment.

Once you graduate, you can choose from repayment plans that base your monthly payment on your income, or a fixed monthly payment over a set repayment period. Calculating your student loan payments can give you an estimate of how much you’ll pay on each plan.

You can prepay your student loans by making extra payments beyond your monthly payment whenever you have extra cash available. You can do that as often you like, whether you do so once a year, once a month, or biweekly. You can even prepay on your federal student loans while you’re in school or during your grace period, but note that these prepayments will not count as qualifying payments for federal loan forgiveness programs.

How to Make Sure Prepayments Are Applied Correctly

It’s important to know how your loan servicer applies prepayments so that you can make sure they are done the way you intend.

Requesting Payments Go Toward Principal

Student loan servicers usually apply your payments first toward any late fees you’ve incurred, then toward any outstanding interest (the amount your lender charges for borrowing), and last, toward your outstanding principal balance (the sum you originally borrowed).

When making prepayments, contact your loan servicer to tell them exactly where the money should go. You can instruct them to put the payment toward the principal. That way it will help reduce your loan balance, which in turn can reduce the amount of interest you’ll pay.

Also, consider making an extra payment right after you make your regular monthly payment, before interest starts accruing between one payment and the next. At that point, your lender will apply the entire prepayment amount toward principal, which again, will shrink the overall amount you owe in interest.

Finally, if you have more than one loan with that servicer, you can also direct them to put the prepayments toward the loan with the highest interest rate, which can help you save more money on interest.

Tracking Loan Servicer Activity

To be sure that the payments were applied correctly, check to make sure that the loan servicer followed your instructions. You can log into your online account with your loan servicer or lender to see your payment information. Also, review your statements each month to make sure the money is going where you want it to. If it’s not, contact your servicer.

Recommended: 6 Strategies to Pay Off Student Debt Loans Quickly

Prepaying Private Student Loans

Like federal loans, most private student loans also allow for prepayment without penalties. Still, it’s helpful to familiarize yourself with the specifics of your particular loans.

Reviewing Loan Terms for Prepayment Clauses

Most private lenders do not charge prepayment penalties. But read through your loan agreement carefully to make sure you can make prepayments without incurring any charges or having to meet specific conditions.

Also, look for information that spells out how loan prepayments are applied and any notification processes borrowers need to follow when making prepayments. See if you could pay off the entire loan early without penalty should you choose to do so.

As you’re reading over your loan agreement, be sure to note your interest rate and term. If they are less than ideal, you may want to consider the option to refinance your student loans.

With refinancing, you replace your existing loans with a private loan with new rates and terms. Depending on the student loan refinancing rates you qualify for, you may be able to reduce the interest rate, loan term, or both.You can refinance one loan, multiple loans, private loans, or a combination of federal and private loans. Just keep in mind that by refinancing federal loans with a private lender, you lose access to federal protections and benefits like forgiveness.

A student loan refinancing calculator can help you determine how much refinancing might save you.

Communicating Directly with Lenders

Tell your lender or loan servicer how to apply the payments to your private loans. Give them specific instructions on how to allocate your extra money. Keep a close eye on your online account and read your monthly statements so you know that your prepayments are going where you want them to.

Benefits of Prepaying Student Loans

There are notable benefits to prepaying student loans, especially when it comes to saving money.

Saving on Interest Over Time

By prepaying your loans and directing the extra payment to the principal balance of the loan, you can reduce the total amount of interest you’ll pay over the life of the loan, which could save you a substantial amount of money.

Paying Off Debt Sooner

Prepaying also allows you to repay your debt faster. It reduces the interest you pay since less interest will accrue than it would have over the full term of the loan. And consider this: The sooner you pay off your loan debt, the sooner you can start directing your money toward other financial goals.

Strategies for Effective Student Loan Prepayment

There are different methods you can use to prepay your loans. One or both of the following techniques may work for you

Using Windfalls and Bonuses

If you get a bonus at work, or you score a windfall — perhaps a relative gives you a generous birthday gift, for example — put that money toward your student loan payments. Any time you come into some extra cash, direct as much of it as you can to your loans to help pay them down faster and save money on interest.

Setting Up Biweekly Payments

With biweekly payments, you make two loan payments per month instead of one, paying half your student loan bill with each payment. You can time the payments to align with when your paychecks hit your bank account to make sure you’ll have the funds on hand.

With the biweekly payment method, you’ll end up making 13 full payments on your loan over the course of a year instead of 12, which can help pay down your principal faster, reduce the total interest you’ll pay, and shorten your loan term.

The Takeaway

Prepaying your student loans generally does not involve penalties or extra fees. This means you can pay off your loans as often or as quickly as you like, ultimately saving money on interest and getting out of the debt faster.

Be sure to contact your loan servicer to tell them how you want your prepayments applied. Then check your account and your monthly statements to make sure your instructions have been followed properly. While you’re at it, review your loan agreement to make sure you’re happy with your loan terms and rates. If not, you may want to consider other repayment methods or plans.

Looking to lower your monthly student loan payment? Refinancing may be one way to do it — by extending your loan term, getting a lower interest rate than what you currently have, or both. (Please note that refinancing federal loans makes them ineligible for federal forgiveness and protections. Also, lengthening your loan term may mean paying more in interest over the life of the loan.) SoFi student loan refinancing offers flexible terms that fit your budget.

With SoFi, refinancing is fast, easy, and all online. We offer competitive fixed and variable rates.

FAQ

Should you prepay student loans?

If you can do it, student loan prepayment can help you pay off your student loan debt faster, and save you considerable money on total interest paid over the life of the loan. Once you get out of student loan debt, you could turn your attention (and your resources) to other financial goals, such as buying a home and saving for retirement.

What about interest charges when you prepay student loans?

When you prepay student loans, ask your loan servicer to apply the extra payments toward the loan principal. This will reduce the loan balance, which is the amount on which future interest is calculated. It can save you money over time by lowering total interest charges.

Can you target specific loans when making extra payments?

Yes. Ask your loan servicer to direct your payments to the loans you most want to pay off — such as those with the highest interest rates, for example, to help you save more money on interest. If you have both federal and private loans, you may want to direct payments to the private loans first, so you can continue to have access to the federal benefits like forgiveness and deferment that come with your federal loans.

Will prepaying impact my credit score?

Making consistent payments on your student loans, including prepayments, can help strengthen your credit by building a positive payment history, which is the biggest factor in determining your credit score.

That said, paying off your loans early can temporarily lower your credit score by reducing your length of credit history and by potentially impacting your credit mix. However the slight drop in your credit score typically doesn’t last longer than several months.

Is it better to save or prepay student loans?

There is no one right answer to this question — it depends on a borrower’s unique situation. But in general, if the interest rates on your student loans are high, you may want to prioritize prepaying them to save money on interest. However, it’s important to have an emergency savings fund in place for any unexpected expenses that pop up. If you don’t have at least three months’ worth of expenses saved for that purpose, you may want to build your emergency fund first and then work on prepaying your loans.

Photo credit: iStock/BartekSzewczyk

SoFi Student Loan Refinance
Terms and conditions apply. SoFi Refinance Student Loans are private loans. When you refinance federal loans with a SoFi loan, YOU FORFEIT YOUR ELIGIBILITY FOR ALL FEDERAL LOAN BENEFITS, including all flexible federal repayment and forgiveness options that are or may become available to federal student loan borrowers including, but not limited to: Public Service Loan Forgiveness (PSLF), Income-Based Repayment, Income-Contingent Repayment, extended repayment plans, PAYE or SAVE. Lowest rates reserved for the most creditworthy borrowers. Learn more at SoFi.com/eligibility. SoFi Refinance Student Loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

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.


Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

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.

SOSLR-Q126-004

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Jan
26
2026
Four women stand in a sunny office, near their desks, discussing private company investing.

How to Invest in Private Companies

By | Growing Wealth, invest, Investing | Comments Off on How to Invest in Private Companies

For most retail investors, investing directly in private companies can be challenging because shares of privately held companies are not available to trade on public exchanges. But due to the growing interest in private company investing, more investors can now access these companies through certain types of platforms, as well as mutual funds and exchange-traded funds (ETFs) — a trend that may continue.

According to estimates from Deloitte, funds allocated to private capital through various channels — which include private companies and other assets not available on public exchanges — could grow from about $80 billion in 2025 to $2.4 trillion in 2030.

Investors need to bear in mind, however, that investing in private companies is less liquid, less well-regulated, and less transparent than investing in public securities, which trade on public exchanges and are required to file certain documents with the Securities and Exchange Commission (SEC). This makes private-company investing higher risk, and it requires more due diligence.

Key Points

•   Investing in private companies means acquiring equity in companies that do not trade on public stock markets

•   These investments are highly illiquid, with capital potentially locked up for years.

•   Private company investing is also considered high risk due to less regulatory oversight and transparency compared with public companies.

•   Retail investors can access private companies through various means, including certain mutual funds and ETFs, early-stage angel investing, venture capital firms, and more.

•   More direct private investments, like angel investing and private equity, are typically reserved for “accredited investors” who meet specific requirements.

Understanding Private Companies

A privately held company is owned by either a small number of shareholders or employees and does not trade its shares on the stock market. Thus investors can’t buy stocks online or through a traditional brokerage. Instead, company shares are owned, traded, or exchanged in private.

This gives company stakeholders more control over the organization — but they also bear more responsibility for the company’s performance and financial stability.

How Private Companies Operate

Private companies may include sole proprietorships, limited liability companies (LLCs), partnerships, or other arrangements, and they can be small businesses or global entities. But because these companies are privately held, they aren’t required to file documents with the SEC as public companies are, which puts them in a higher risk category for most investors.

Without that transparency and oversight, it can be difficult to know for certain what the value of a private company is, or track other key financial metrics like sales or profits.

Private Companies and Liquidity

In addition, because private companies aren’t publicly traded, investments in these firms are highly illiquid. Capital may be locked up for a period of years before a company is sold or goes public. These days, that period may be longer, according to a Morningstar analysis. Because private companies are attracting more investor capital, some are taking longer to go public, with the median age increasing from about 7 years in 2014 to roughly 11 years in 2025.

In order to gain access to investor capital, a private company could also undergo an initial public offering (IPO), which means that it has publicly issued stock in hopes of raising capital and making more shares available for purchase by the public.

Nonetheless, as noted above, investors interested in self-directed investing may be able to find new vehicles that allow private company investment.

The Growth Journey: Startups to Unicorns

The appeal of private company investing for some investors isn’t about trading stocks, but possibly getting in on the ground floor of the next big thing. In some cases, the goal of a private company as a startup is to become a “unicorn.” A “unicorn” company is a private company that’s valued at more than $1 billion.

Very few companies become unicorns, and for investors, a primary goal is to find and invest in companies that will become unicorns.

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now for the rest of us.

Explore trading funds that include commodities, private credit, real estate, venture capital, and more.

Strategic Pathways to Private Investments

There are several ways to invest in private companies, though not all of them will be available to every investor. While investing online typically provides access to a range of conventional securities, investors interested in private markets must consider other channels.

Early Stage Investments and Angel Investing

Early-stage investing, often called angel investing, involves making an investment in a fledgling company in exchange for ownership of that company. This tends to be the riskiest stage to invest in, as companies at this stage are small, young, and typically unproven.

In addition, angel investors often put up their own capital, and may provide mentorship to a startup as well. That said, the risk of loss is high, as most startups fail. For this reason, angel investors must be accredited investors. An accredited investor is an individual or entity that meets certain criteria, and can thus invest in hedge funds, private equity, and more.

Venture Capital Firms

Venture capital investors typically work for big firms that specialize in private company investing. They don’t invest their own money, but rather the money of those who have put their money at the disposal of the VC company.

In that sense, VC firms aren’t like angel investors; they enter the picture later, once the company has a longer track record.

Joining Private Equity Firms

Investors can also get involved in private company investing through private equity. Private equity firms invest in private companies, like angel investors, in hopes that the equity they acquire will one day be much more valuable.

Again, this is likely not an option for the average investor, as private equity is usually an area reserved for high-net-worth individuals.

Investing in Pre-IPO Companies

Some investors attempt to invest in companies before they go public to take advantage of any post-IPO spikes in share value. There are a few ways to invest in pre-IPO companies.

Leveraging Pre-IPO Investing Platforms

There are certain platforms that allow investors to make investments in pre-IPO companies. An internet search will yield some of them. Those platforms tend to work in one of a few ways, usually by offering investors access to specialized brokers who work with private equity firms, or by directly connecting investors with companies, allowing them to make direct purchases of stock.

You’ll need to do your own research into these platforms if this is a route you plan to pursue, but also know that there are significant risks with these types of investments.

The Accredited Investor’s Guide

Certain private investments require you to be an accredited investor.

Qualifications and Opportunities

For individuals to qualify as accredited investors, according to the SEC, they need to have a net worth of more than $1 million (excluding their primary residence), and income of more than $200,000 individually, or $300,000 with a spouse or partner for the prior two years.

There are also professional criteria which may be met, which includes being an investment professional in good standing and holding certain licenses. There are a few other potential qualifications, but those are the most broad.

Exclusive Markets for the Accredited Investor

Becoming an accredited investor basically means that you can invest in markets that are typically not accessible to other investors. This includes private companies, and private equity.

Effectively, being “accredited” comes along with the assumption that the investor has enough capital to be able to make riskier investments, and that they’re likely sophisticated enough to be able to know their way around private markets.

The Pros and Cons of Private Company Investments

There are pros and cons to investing in private companies that investors should be aware of.

Advantages of Private Market Engagement

Because private companies are often smaller businesses, they may offer investors an opportunity to get more involved behind the scenes. This might mean that an investor could play a role in operational decisions and have a more integrated relationship with the business than they could if they were investing in a large, public company.

In an ideal scenario, if you invested in a private company, you’d get in earlier than you would when a company goes public. This could translate to a larger or more valuable equity stake, or possibly a more influential role. But that depends on numerous factors as the company evolves, and there are no guarantees.

Investing in a private company might also mean that you are able to set up an exit provision for your investment — meaning you could set conditions under which your investment will be repaid at an agreed upon rate of return by a certain date.

Risks and Considerations

One of the biggest risks involved in investing in a private company is that you’ll almost certainly have less access to information about company fundamentals than you would with a public company. Not only is it more challenging to obtain data in order to understand how the company performance compares to the rest of the industry, private companies are also not held to the same standards as publicly traded ones.

For example, because of SEC oversight, public companies are held to rigorous transparency and accounting standards. In contrast, private companies generally are not. From an investor’s standpoint, this means that you may sometimes be in the dark about how the business is doing.

And even though there may be an opportunity to set up an exit provision as an investor in a private company, unless you make such a provision, it could be a huge challenge to get out of your investment.

Considerations for Investing in Private Companies

Just like investing in public stock exchanges, there are some steps that investors may want to follow as a sort of best-practices approach to investing in private companies.

Conducting Thorough Research

Doing sufficient research is essential when investing in a private company. As noted, this may be difficult as there’s going to be less available information about private companies versus public ones. You also won’t be able to research charts and look at stock performance to get a sense of what a company’s future holds.

Identifying and Assessing Potential Deals

The goal of due diligence is to identify companies that appear healthy, are competitive, and that you think have a good chance of surviving the years ahead.

The Transaction: Making Your First Private Investment

Depending on how you choose to invest, making your first private company investment may be as simple as hitting a button — such as on a private crowdfunding website or something similar. Just know that it’ll probably be a bit different than buying stocks or shares on an exchange.

Post-Investment Vigilance

As with any investment — public, or private — investors will want to keep an eye on their holdings.

Monitoring Your Investment

Monitoring your investment in a private company is not going to be the same as monitoring the stocks you manage in your portfolio. You won’t be able to go on a financial news website and look at the day’s share prices. Instead, you’ll likely need to be in touch with the company directly (or through intermediaries), reading status reports and financial statements in order to learn how business is operating.

It’ll be a bit opaque, and the process will vary from company to company.

Exit Strategies and Liquidity Events

When an investor “exits” an investment in a private company, it means that they sell their shares or equity and effectively “cash out.” If an investor bought in at an early stage and the company gained a lot of value over the years, the investor can “exit” with a big return. But returns vary, of course.

Liquidity events present themselves as times to exit investments, and for many private investors, the time to exit is when a company ultimately goes public and IPOs. But there may be other times that are more favorable to investors, depending on the company.

Investment Myths Debunked

As with any type of investment, private companies are the subject of certain myths.

Setting Realistic Expectations

A good rule of thumb for investors is to keep their expectations in check. In all likelihood, you’re not going to stumble upon the next Mark Zuckerberg or Jeff Bezos, desperately looking for cash to fund their scrappy startup. Instead, you may be more likely to find a company that has good growth potential but no guarantee of survival.

For that reason, it’s important to always keep the risks in mind, as well as what you actually expect from an investment.

Common Misconceptions

Some further misconceptions about private investing include that it’s only for the ultra-rich, that every investment may offer high returns (along with high risks), and that profits will come quickly. An investment may take years to ultimately pay off — if it does at all.

Ready to Invest? Questions to Ask Yourself

Once you know more about private markets, there are still some questions to consider.

Assessing Your Risk Tolerance

Are you okay with taking on a significant degree of risk? Private company investing, with its lack of transparency and oversight, comes with more risk exposure. Take stock of how much risk you can handle financially, as well as your personal tolerance for risk,

Aligning Investments with Personal Goals

Consider how your investments in private markets align with your overall investing goals. It’s important to remember that private markets are higher risk and also less liquid. Any capital you invest could be tied up for a longer period of time than it would be with more conventional investments.

The Takeaway

Investing in private companies entails buying or acquiring equity in companies that are not publicly traded, meaning you can’t buy shares on the public stock exchanges. Because this is a higher risk type of investing, there is a possibility of bigger gains, but the potential downside of these companies is significant.

Private markets are not regulated by the SEC in the same way that conventional markets are, with less stringent reporting rules, for example.

Investing in private companies is not for everyone, and there may be stipulations involved that prevent some investors from doing it. If you’re interested, it may be best to speak with a financial professional before making any moves.

Ready to expand your portfolio's growth potential? Alternative investments, traditionally available to high-net-worth individuals, are accessible to everyday investors on SoFi's easy-to-use platform. Investments in commodities, real estate, venture capital, and more are now within reach. Alternative investments can be high risk, so it's important to consider your portfolio goals and risk tolerance to determine if they're right for you.


Invest in alts to take your portfolio beyond stocks and bonds.

FAQ

Who is the owner of a private company?

Shares of private companies can be held by the founder(s), employees, family members, and in some cases angel or VC investors. A public company, by contrast, is owned by the shareholders.

Why are private companies riskier investments than public ones?

Public companies are required to file key documents regularly with the SEC, and this level of transparency and accountability helps to make the risks associated with those companies more visible. Private companies don’t have to share this information, therefore investors may find it hard to know what they’re getting into.

How much capital is needed to invest in a private company?

There isn’t a limit to how much capital needed to invest in private companies, but to be an accredited investor, there are income and net worth limits that may apply.

What are the time commitments and expectations?

There are no hard and fast time commitments or expectations of private investors, in a general sense. But that may differ on a case by case basis, especially if an investor takes a broader role with managing a company they’re investing in.

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SoFi Invest is a trade name used by SoFi Wealth LLC and SoFi Securities LLC offering investment products and services. Robo investing and advisory services are provided by SoFi Wealth LLC, an SEC-registered investment adviser. Brokerage and self-directed investing products offered through SoFi Securities LLC, Member FINRA/SIPC.

For disclosures on SoFi Invest platforms visit SoFi.com/legal. For a full listing of the fees associated with Sofi Invest please view our fee schedule.

An investor should consider the investment objectives, risks, charges, and expenses of the Fund carefully before investing. This and other important information are contained in the Fund’s prospectus. For a current prospectus, please click the Prospectus link on the Fund’s respective page. The prospectus should be read carefully prior to investing.
Alternative investments, including funds that invest in alternative investments, are risky and may not be suitable for all investors. Alternative investments often employ leveraging and other speculative practices that increase an investor's risk of loss to include complete loss of investment, often charge high fees, and can be highly illiquid and volatile. Alternative investments may lack diversification, involve complex tax structures and have delays in reporting important tax information. Registered and unregistered alternative investments are not subject to the same regulatory requirements as mutual funds.
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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.

Investing in an Initial Public Offering (IPO) involves substantial risk, including the risk of loss. Further, there are a variety of risk factors to consider when investing in an IPO, including but not limited to, unproven management, significant debt, and lack of operating history. For a comprehensive discussion of these risks please refer to SoFi Securities’ IPO Risk Disclosure Statement. This should not be considered a recommendation to participate in IPOs and investors should carefully read the offering prospectus to determine whether an offering is consistent with their investment objectives, risk tolerance, and financial situation. New offerings generally have high demand and there are a limited number of shares available for distribution to participants. Many customers may not be allocated shares and share allocations may be significantly smaller than the shares requested in the customer’s initial offer (Indication of Interest). For more information on the allocation process please visit IPO Allocation Procedures.

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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 emailing customer service at [email protected]. Please read the prospectus carefully prior to investing.

Mutual Funds (MFs): 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 clicking the prospectus link on the fund's respective page at sofi.com. You may also contact customer service at: 1.855.456.7634. Please read the prospectus carefully prior to investing.Mutual Funds must be bought and sold at NAV (Net Asset Value); unless otherwise noted in the prospectus, trades are only done once per day after the markets close. Investment returns are subject to risk, include the risk of loss. Shares may be worth more or less their original value when redeemed. The diversification of a mutual fund will not protect against loss. A mutual fund may not achieve its stated investment objective. Rebalancing and other activities within the fund may be subject to tax consequences.

SOIN-Q425-035

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Jan
26
2026
man in the library

What Is the Average Cost of College Tuition in 2026?

By | Student Loans, student_loan | No Comments

The average cost of college tuition varies widely based on location and whether the school is public or private. The average cost of college for in-state students at a four-year institution in 2024-25 is $11,610. Students at private nonprofit four-year institutions paid over $43,000, on average.

Read on for more information about average tuition costs and other expenses facing college students.

Key Points

•   Average tuition and fees for in-state students at public four-year institutions for 2024-25 are approximately $11,610 per year.

•   Tuition for out-of-state students at public four-year institutions averages $30,780 annually.

•   The average annual tuition and fees at private nonprofit four-year institutions are about $43,350.

•   College costs continue to rise annually, with rates depending on location, institution type, and other factors.

•   Ways to pay for college include cash savings, scholarships, grants, federal work-study, and federal and private student loans.

The Average Cost of College

According to the College Board’s annual “Trends in College Pricing” report, the average cost of attending a four-year college as an in-state student at a public university during the 2024-25 school year is $11,610. For an out-of-state student attending a public four-year college, the average rose to $30,780.

The average cost of attending a private four-year institution is $43,350. These averages are based on the published price at a college or university. This includes tuition, fees, and room and board.

Cost is a major factor for students deciding which school to attend. According to the annual Sallie Mae survey “How America Pays for College 2024,” 81% of parents and students eliminated a college based on cost.

Historical Average Cost of Tuition

The cost of tuition has increased dramatically over time. For the 2004-05 school year, the average cost of college tuition at a public four-year institution was $5,132 for a student receiving in-state tuition. In 20 years, tuition rose to $11,610 for the 2024-25 school year.

U.S. News reviewed tuition costs at 436 ranked National Universities, those universities included as part of the annual college rankings. According to their data, the average tuition and fees at private National Universities increased by 126% in 20 years from 2004 to 2024. During the same period, at four-year public National Universities, tuition for out-of-state students increased by 112%, and for in-state students it rose by 133%.

Average Total Cost of College

A traditional undergraduate college degree takes four years to complete, which means four years of tuition costs. According to EducationData.org, the cost of college has risen, on average, about 7.0% annually since 2000.

Year-over-year changes can fluctuate greatly, however, so it can be challenging to predict exactly how much a student will pay in tuition costs over the course of their degree. For example, the “Trends in College Pricing” report found that in-state tuition costs at public four-year institutions increased just 2.7% from the 2023-24 to the 2024-25 school year. For that same time period, tuition increased 3.9% at private nonprofit four-year institutions.

To get a rough estimate of how much college will cost in its entirety, you can take the current tuition rate and multiply it by four. Keep in mind this won’t account for any increase in the cost of tuition.

Average Additional College Expenses

Tuition generally makes up the majority of a student’s college expenses. But there are other fees and costs to factor in, including room and board, books, and other supplies. As you plan how to pay your tuition, students might also consider general living expenses.

What Is the Cost of Room and Board?

Some colleges charge “comprehensive fees,” which reflect the total for tuition, fees, and room and board. Other schools charge room and board separately from tuition and fees. The cost of room and board typically accounts for the cost of housing (i.e., a dorm room or on-campus apartment) and the meal plan.

The average cost of on-campus room and board for the 2024-25 school year is $12,917 for four-year public institutions for both in-state and out-of-state students, and $13,842 for four-year private nonprofit institutions.

The actual cost will vary depending on the type of housing you live in and the meal plan you choose. Housing can be another determining factor for students. About 73% of students attend college in their home state, and 36% live at home or with relatives to save on housing costs.

The Cost of Extra Classes

Tuition at some schools covers the cost of a certain number of credit hours. Your credit hours can vary each term depending on the classes you enroll in. If you exceed the number of credit hours covered by tuition, you may pay an additional fee.

Books and Supplies

On top of those expenses, don’t forget to budget for books and supplies. The average college student attending a public, four-year college spends $1,220 on textbooks per year.

Transportation

Transportation is another major category of expenses for college students. Will you have a car on campus? If so, plan to pay for gas, insurance, and a parking permit. How often do you plan to go home? Will a trip to visit your family require airfare?

Other Living Expenses

Then there are additional personal expenses like eating out, laundry, and your monthly cell phone bill. To get an idea of how much you’ll actually spend every month, it helps to review your current spending.

College may be the first time you’ve had to learn how to budget. Consider sitting down with your parents, an older sibling, or a trusted friend who has already navigated their first year of college to get an idea of the expenses you may encounter.

Paying for College

There are, of course, options available to help you finance your education. Whether you’re going to college for the first time or returning for further education, consider looking into the following options:

First Thing’s First: The FAFSA

A common first step for students interested in securing federal financial aid is to fill out the Free Application for Federal Student Aid (FAFSA®). As you get ready to apply, pay attention to deadlines, as they vary by school and state. After you fill out the FAFSA, you’ll receive an offer letter detailing the type of aid you qualify for. This may include scholarships and grants, work-study, and federal student loans.

Planning ahead is one way to set yourself up to successfully pay for college. If you’re not quite ready to fill out the FAFSA yet, you can use the Federal Student Aid Estimator at StudentAid.gov/Aid-Estimator/ to get an idea of how much aid you might qualify for.

Recommended: Important FAFSA Deadlines to Know

Scholarships and Grants

Scholarships and grants can be immensely helpful when it comes to paying for college, since that money doesn’t need to be repaid. In addition to filing the FAFSA, you can check to see if there are any other scholarships for which you may qualify. There are also online resources and databases that compile different scholarship opportunities.

The federal work-study program is another form of aid that can help students pay for college. If you are eligible for work-study and receive it in your financial aid award, you may still have to find your own employment at your university. Check with your school’s financial aid office to find out if your school participates and whether they will place you or if they have a work-study job board.

Of course, other jobs for college students are available, but students will have to pursue those on their own.

Recommended: Grants for College

Student Loans

Student loans offer another avenue for students to finance their college education. Unlike scholarships and grants, however, student loans must be repaid. There are two kinds of student loans — federal and private.

Federal Student Loans

Applying for student loans requires filling out the FAFSA. Federal loans for undergraduates can be either subsidized or unsubsidized. With a subsidized loan, borrowers won’t be responsible for paying the interest that accrues on the loan while they are actively enrolled in school at least half-time. With an unsubsidized loan, borrowers are responsible for paying the accrued interest during all periods.

Whether subsidized or unsubsidized, loan repayment generally doesn’t begin until after graduation (or a student drops below half-time) and a grace period.

Most grace periods for federal loans are six months. Interest rates on federal student loans are set by the government and are fixed for the life of the loan.

Federal loans aren’t guaranteed to cover your undergraduate or graduate school tuition costs. There are borrowing limits that restrict the amount of federal loans a student can take out each year. For example, a first year undergrad, dependent student is currently allowed to borrow $5,500 in federal loans. In some cases, private student loans may be used to fill in the gaps.

Private Student Loans

Private student loans are offered by banks, credit unions, and online lenders. Terms and conditions of a private student loan are set by the individual lender.

Private lenders will likely review a borrower’s credit history and other financial factors in order to determine what type of loan they may qualify for. If an applicant is applying with a cosigner, private student loan lenders will look at their financial background as well, which might include things like their credit score and current income.

While federal student loans come with fixed interest rates, private student loans can have fixed or variable interest rates. Variable interest rates may start lower than fixed rates, but they rise and fall in accordance to current market rates.

Private student loans don’t carry the same benefits and protections offered by federal student loans — such as income-driven repayment and loan deferment options. Some lenders may offer their own benefits, though.

The Takeaway

The average cost of college tuition for the 2024-25 school year was $11,610 for students paying in-state tuition at a four-year public institution. For out-of-state students, the average was $30,780. At a private four year institution it was $43,350. Paying for college usually requires a combination of financing options, including savings, scholarships, grants, work-study, federal student loans, and even 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

How much does four years of college cost on average?

The average cost for four years of college varies based on the institution type. As of 2024, attending an in-state public college averages around $108,000, including tuition, fees, and living expenses. Private colleges are significantly higher, averaging over $230,000 for four years. Costs can vary further by location and program.

How much has college tuition increased in 2024?

In the 2024-2025 academic year, average tuition and fees increased by 2.7% for in-state students at public four-year institutions and by 3.9% at private nonprofit four-year institutions. These increases are below the general inflation rate of 3.1% for the same period.

What are ways to save money on college expenses?

There are many ways to save money on college expenses, including by attending in-state public colleges, starting at a community college, or enrolling in accelerated degree programs. You can apply for scholarships, grants, and work-study opportunities, use tax-advantaged 529 savings plans, minimize textbook costs through rentals or e-books, and reduce living expenses by commuting or sharing housing.

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.

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Terms and conditions apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. To qualify, a borrower must be a U.S. citizen or other eligible status, be residing in the U.S., and meet SoFi's underwriting requirements. Not all borrowers receive the lowest rate. Lowest rates reserved for the most creditworthy borrowers. If approved, your actual rate will be within the range of rates at the time of application and will depend on a variety of factors, including term of loan, evaluation of your creditworthiness, income, and other factors. If SoFi is unable to offer you a loan but matches you for a loan with a participating bank, then your rate may be outside the range of rates listed above. Rates and Terms are subject to change at any time without notice. SoFi Personal Loans can be used for any lawful personal, family, or household purposes and may not be used for post-secondary education expenses. Minimum loan amount is $5,000. The average of SoFi Personal Loans funded in 2023 was around $33K. Information current as of 2/26/24. SoFi Personal Loans originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org). See SoFi.com/legal for state-specific license details. See SoFi.com/eligibility for details and state restrictions.

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