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How to Graduate Debt Free


I didn’t go to the most prestigious college in the country, but I was able to achieve something that very few college graduates can accomplish: graduate debt free. Before you assume that I had Mommy and Daddy pay for it (nothing wrong with that if you have this advantage), it couldn’t be further from the truth. Sure, my parents helped me a little bit, but they helped me in different ways: paying for my car insurance and any unsettling car bills (like when the engine crapped out on me and had to be replaced).

As I now talk with most of my friends, I realize how rare of an achievement it is to graduate debt free. It may be more difficult for some, depending on which school they attend, but it’s never impossible. With the resources available to you, you too can learn to graduate without owing the bank or government 5 or 6 figures.

How I Graduated Debt Free

There is no magic formula that will apply to everyone, but there were three important things that I did (that others didn’t) that allowed me to graduate debt free.


The first area that gave me a huge boost of confidence was the scholarships that I received. While I was typically towards the top of my class in high school in terms of academics, I was never the brightest or the one with the best grades. So, when it came to getting scholarships, I had to work for them. This meant re-taking the SAT’s so that I could get an additional 90 points to be eligible for a merit scholarship. I found out that I exceeded the necessary 90 point boost and was awarded full tuition for the first year. After the first year, I would be eligible for 40% tuition every year after the first if I kept my grades up. Done!

That wasn’t it. I knew that paying for room and board, as well as the other day-to-day expenses would be difficult if I didn’t improve things. I looked at the Financial Aid department’s website and found another scholarship that I could apply for. I filled out the application, wrote the essay, and believe it or not, I was one of the 10 people selected. This just goes to prove that you never know what can happen until you try. I realize now that no job could have replaced the amount of money that I received from these scholarships.


While my scholarships gave me a huge head start on getting through college, I knew that years 2-4 would be difficult without the full-tuition after the first year. Thus, I did what any person who is determined to graduate debt free would do. I started looking for jobs in my second semester of my freshman year. It’s not easy to get the best job in college, but I set out to find out what it was and secure it before everyone else did.

I ended up working two jobs my sophomore year. This would prove to be an easy task when you compare it to my three jobs the year after that. While classes were getting more difficult and time-consuming, I pressed on. I didn’t earn a high wage, but I was fortunate enough to scrape by with what I had. That’s what you need to do, whether you’re in college or life in general: get by with the job(s) that you can secure.

Limit Spending

As I look back on how I was able to walk across the stage in receiving my diploma without owing anyone any money, I know it was also a product of my frugal lifestyle. It’s not something that I’ve always had. My first semester in college (the first 4 months), I spend 20% of my savings. I was forced to ask myself where I spent all of this money. While I didn’t know exactly where the money had gone (I wasn’t tracking my spending back then), I did know that I wouldn’t last long if I continued to spend money like I was. I immediately rationed key areas in order to make sure I could survive the next 3 and a half years. At one point, I was pretty desperate and was living off of $25 per week for food. It wasn’t the healthiest diet, but I did what I needed to in order to get through a difficult financial time.

For those who graduate debt free, I would guess that many of them are with assistance from their parents. These are the parents who have prepared well in advance and know the hardship that their children would face without the assistance. For the rest of us, it all comes down to hard work and determination. It’s not easy to pay your way through school, but it is possible. I’m living proof of that.

Readers, did you graduate debt free? If so, how did you do it? If not, how long did it take you to pay off your student loans?

This post was written by Corey, a staff writer from 20’s Finances.

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AUTHOR Derek Sall

Derek has a Bachelor's degree in Finance and a Master's in Business. As a finance manager in the corporate world, he regularly identified and solved problems at the C-suite level. Today, Derek isn't interested in helping big companies. Instead, he's helping individuals win financially--one email, one article, one person at a time.


  1. I definitely did not graduate debt free, but I don’t think I did too horrible either. I have around $35,000 in student loans but I plan on paying them all off by March or April of this year (lump sum payment mostly).

    I didn’t have any help, and I was forced to find a place to live one month after high school and only around a week after I turned 18. I do believe that if I was able to live at home, that I probably would have graduated with very little debt though.

    • Though I did receive scholarships & financial aid I definitely did not graduate debt free. Partly because I went to a private business school – which really was not necessary. So, yep, still paying off student loans. I was able to pay off half of undergrad when I received a chunk of money several years ago and forging ahead to accelerate payoff.

    • Michelle, it sounds like you overcame a lot. It sounds like you are doing quite well for yourself, so I’m sure what is left of it (if any) will be gone soon.

  2. I graduated debt free with help from my parents. They agreed to pay half and my scholarships and odd jobs paid for the other half. I am so glad I took the time to apply for the scholarships I did and I wish I had applied to even more…

    • Yeah, I understand all too well about scholarships. I felt like I applied to a lot, but there were probably more to be had.

  3. Congrats on graduating debt free. Not too many people can say that. I know of a young woman who graduated college with double majors and almost a 4.0 GPA working full time and living on her own. She still has student loan debt which is acceptable. Although it would be nice when looking to get a graduate degree there were scholarships that were available.

    • Thanks Ornella. It sounds like she is doing all that she can to succeed and limit the school debt she goes into.

  4. Congratulations to you for a job well done. I also graduated debt-free. Thanks to my parents who really prepared for my college days. They pay for my tuition, though I have to work for my allowance.

    • Good for you Sarah. I wish more parents provided assistance to their kids.

  5. Congrats! It is very difficult to graduate debt free these days due to the financial crisis that most people are facing and your story is an inspiration especially to those who are thinking of doing the same, but are afraid of the hard work that goes with it.

  6. Congrats to you! It is not a small accomplishment to graduate debt free especially when you do not have much help from your parents. I wish more students were as determined as you are. Unfortunately, what i often see in my practice is people who just accept debt as a given. Almost like a requirement to graduate college.

  7. Graduating debt free must be an amazing feeling. Sadly I am not in the same boat, although my degree wouldn’t really allow me to work 3 jobs with over 35 contact hours a week. I did manage to squeeze one in but it didn’t quite cover it. You’ve proven graduating with debt doesn’t have to be a given, which is the mindset of many people in the current era.

  8. I was able to graduate debt free thanks to the Army. Not only did they pay for my school but I was given a guaranteed job for the next 4 years of my life where I would learn a very marketable skill. I know everybody doesn’t have or want this option, but it is definitely an option that should not be overlooked.

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