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The colleges don’t care how you pay, as long as you pay on time. This statement elicits some giggles, but it is the truth! Whether you are paying with your savings, your current cash flow, or a loan, it makes no difference to the college, as long as all funding is processed by the tuition bill’s due date.  

Invoices for the fall semester usually arrive around the first week of July and payments are typically due the first week of August. Parents anxiously waiting by the mailbox for that first bill should take note: bills are sent to the students, and more often than not are electronic. If you have not received a bill yet, have your child check their college email address for notifications. They may need to log on to a student account portal using their college ID and password in order to view and print the billing statement.

Check the bill for accuracy, making sure all your deposits, grants, scholarships, and approved loans have been credited and that you are receiving the appropriate charges for tuition, fees, housing, and meal plans. Remember that work study funding is not credited to your bill (it is earned and paid through a weekly or biweekly paycheck) and student loans have fees deducted from what you borrow, resulting in smaller credits than the original loan amount.

Every school sets their own policies and procedures for paying the college bill, but families can piece together their payments in a variety of ways: checks, auto debit from bank accounts, electronic funds transfer (EFT) from 529 plans, monthly payment plans, or loans. Most colleges do not accept credit card payments or otherwise will have a maximum credit card limit.

College finance educators are not immune to the sticker shock of receiving that first tuition bill, and I too had to put together the puzzle pieces when managing my own children’s college payments. For my son’s college, I chose to pay a portion of his tuition bill on the university’s monthly payment plan, spreading the annual cost over 10 equal monthly payments. I set up an online account online with the school’s payment plan vendor at the cost of a reasonable service fee, and instructed the vender how much money to pull each month and which bank account to pull it from. The fact that I was paying monthly was reflected on the school’s bill; they considered my balance paid even though they had yet to receive those future monthly payments. I was also able to set up an auto debit from my bank account to the school. Now, every time there is a charge on my son’s student account, I can log in and instruct the university to withdraw the required amount from “mom’s checking.” No need to enter my routing and account numbers every semester.

However, when it was time to pay my daughter’s tuition bill, I still had some savings in my 529 plan. I instructed the plan manager to send the amount needed via EFT directly to the college. It can take several business days for the transaction to go through, so make sure you allow ample processing time. Education loans require even more processing time, as they must be approved by the lending institution and certified by the college’s Financial Aid Office; so, don’t wait until the last minute to apply. Once loans are certified, provisional credits will be added to the student’s account, so that the bill is considered settled while awaiting actual fund transfer.

Now that it is July, be on the lookout for the college bill, review it for accuracy, and determine which one (or more) of the varied payment methods you will use. Paying the college bill can be a challenge, but knowing your options can transform this seemingly insurmountable task into a—I won’t say enjoyable—but at least a manageable undertaking.

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Written by Laurie Peltier
Laurie Peltier is a college finance expert at College Coach. Before joining College Coach, she was a Senior Financial Aid Officer at Becker College and Anna Maria College.