(MONEY Magazine) – ANGELIQUE ROBERTS

ATLANTA. She worked full time to pay for community college, but when she transferred to a four-year private college that costs $28,000 a year, she finally had to take out loans. "I was struggling to keep my head above water," she says.

Angelique Roberts never thought she could afford college. At 19, she changed her mind. She worked hard, at everything from day care to waitressing, and by 2001 she'd saved enough to enter Georgia Perimeter College, a two-year community college in Atlanta. Tuition: $1,400 a year. But the 23-year-old freshman had set her heart on studying international relations, and that meant she'd have to finish up at a four-year school. She chose Agnes Scott, a private college in Atlanta. Tuition, room and board: $28,000. To pay for it, she used her savings and a grant from Agnes Scott, and she borrowed--a federal Stafford loan, an informal loan from her uncle and finally a one-year, $16,000 variable-rate student loan from Bank of America. She'll be paying back her $50,000 to $60,000 debt for decades to come, but she's sure she made the right decision.

Angelique, one of eight siblings, is footing her own bills. But even families that get an early start on education saving for their children or grandchildren rarely manage to put away the entire cost of college. So try to save enough--say, one or two years' worth of expenses--to minimize the debt you'll face later. If you have young children, one of MONEY's three smart strategies may be right for you (page 78). Whatever your situation, take heart from the stories on these pages--it's not easy, but you can pay for college.

A SUMMER JOB LED TO A FULL SCHOLARSHIP

DAN NGUYEN

DEKALB, ILL. To supplement his scholarship, he works part time at school and caddies full time in the summer.

As a high school student in Wheaton, Ill., Dan Nguyen enjoyed his three summers as a golf caddy, but he never expected his job at a local country club to be his ticket to a college education. In fact, for most of his high school career, Nguyen didn't expect to go to a four-year college. At age 14, as his peers began practicing for the PSATs, Nguyen was just mastering English, a language he barely knew when his family immigrated from his native Vietnam the previous year. With both his parents working in factories to support Dan and his two brothers, he knew there was no money for college; although he was an A student, Dan didn't even fill out applications in the fall of his senior year. "I guess I just figured I would go to the local community college," he says.

But his caddy master was impressed by Dan's ambition--by starting at 6:30 a.m. and caddying two full 18-hole rounds each day, he'd earned more than $5,000 one summer--and told him about the Evans Scholarship. Open only to caddies, it covers tuition and housing at one of 18 universities for up to four years. "I never would have known anything about the scholarship if my caddy master hadn't told me," Dan says. "And I didn't expect to get it." After he got the acceptance letter from the Evans Scholars Foundation, he had to scramble to fill out college applications.

Now 21 and a junior majoring in finance at Northern Illinois University, Dan works in a computer lab at school for books and spending money. "I know kids who work a lot harder than me," he says modestly.

A PAYMENT PLAN SPREADS THE COST

THE JONESES

SPENCER, IND. Doug and Dede have finished paying for Nathan, 22, and expect to do the same for sons (from left) Truman, Donovan and Corban.

Douglas and Dede Jones met in college, at Olivet Nazarene University, a small, private Christian school in Illinois. "I invited him on a date during the week when the girls were supposed to ask the guys," recalls Dede. So they were delighted when the eldest of their four sons, Nathan, now 22, chose to attend Olivet four years ago. The cost: $16,000 a year (now $20,000). Doug, 47, and Dede, 46, both public school teachers, knew it would take a little finagling to meet the financial commitment. With a combined six-figure salary, they did not qualify for need-based aid. Nathan has taken the maximum federal Stafford loan ($2,625 to $5,500) each year; the Joneses have paid the balance from their income. To help manage the bills, they signed up for Tuition Management Systems, a payment-management company that allows them to make nine or 10 equal payments a year for a fee of $50. "By using TMS, we haven't really had to borrow extra," says Dede. When Corban, now 21, followed his brother to Olivet, the Joneses doubled up their monthly payments and took out a $55,000 home-equity line of credit as a backup. "Of course, I didn't get a new car," Dede says, "but we make it work."

ONE LOAN FOR TUITION--AND ONE FOR A BACKUP

HENRY RESNICK

BOCA RATON, FLA. A financial adviser led the Resnicks to the federal loan plan for parents of college students.

When the Resnicks moved to Florida 10 years ago, they had a choice to make: Contribute to the state's prepaid college plan for their two sons or keep feeding their retirement accounts. The 51-year-old couple chose retirement. Hank, a pharmacist at a hospice, and Mary Lee, a nurse and case manager at a community hospital, also decided to pay off their 15-year mortgage as quickly as possible. That way, by the time Jacob, now 19, and Aaron, 18, were both in college, they could redirect the money that had been going to monthly payments toward their sons' higher education.

But that didn't solve the problem of how to pay the $32,000 for Jacob's freshman year at Rollins College in 2003 or the $80,000 they'll owe when Aaron joins his brother at Rollins this fall. So in December 2002 they went to Geoff Kasher, a financial adviser, who suggested they take out two loans--one for tuition and one for emergencies. He introduced them to a federal PLUS loan for parents--they took one for $27,000--with interest-only payments now; they have up to 30 years to pay it off. The second loan: a $200,000 home-equity line of credit (HELOC), at prime, for emergencies.

The Resnicks, whose combined income puts them in the 28% tax bracket, are pleased that they can save for retirement and still afford their sons' college. But they're not completely happy. "As the cash-poor middle class," says Hank, "we don't get a lot of scholarship money. You work all your life to amass wealth, and you're kind of penalized for that."

AT LAW SCHOOL, THE STAFFORD LOANS ADD UP

KENYA, DESHUN AND WARREN MARTIN

EDWARDS, MISS. Even with large scholarships, they have loans totaling $75,000.

They've never been apart. They graduated from the same high school, went to the same college and then chose the same law school. The 25-year-old Martin triplets even received overlapping scholarships. So it's no surprise that when they graduate this month from the University Of Mississippi School Of Law, they'll be paying back the same loans.

Even for triplets, the synchronicity of their academic and financial lives is extraordinary. They're frank about the competitiveness that characterized their youth, although, says Kenya, "the other side of the coin is that we were also supportive. I think we're all graduating because of each other." The three received full scholarships as undergrads at Jackson State University. Deshun, the "oldest," was awarded his as the high school salutatorian. Kenya's and Warren's expenses--about $30,000 apiece for the four years--were covered by presidential scholarships in recognition of their academic achievements.

Law school was another story. The Martins knew that their exceptional academic records--Kenya and Warren graduated from JSU as valedictorians with 4.0 averages; Deshun trailed them slightly with "3.9 and change," as he puts it--wouldn't get them a free ride there. So they began working summers after high school. "Mom wouldn't let us work before," explains Deshun. "She didn't want us to taste the lust for money until college, otherwise we wouldn't want to go back." Holding on to virtually every penny, they each saved close to $10,000.

The bulk of their $6,000-a-year law school tuition--73%--came from Minority Tuition Grants that are awarded by the law school to African-American students from Mississippi. About half a dozen other awards gave the three a few thousand dollars more apiece, but when the Martins take the bar exam this July, they will have a collective $75,000 worth of federal Stafford loans waiting for them.

"I owed nothing for undergrad," says Deshun. "I came to law school to go broke." Kenya, the only one of the three who is married, is in a hurry to pay off his bill. "Tommie and I want to build a house," he explains. "We want to be in the best situation to get the best mortgage."

But Warren, whose $15,000 bill is the lowest, figures that starting attorneys in Mississippi earn $45,000 to $55,000, "so considering the income-to-debt ratio, I'm elated."

A PREPAID TUITION PLAN FOR THE THIRD GENERATION

DENNIS AND DELOISE WILKIE

COLUMBIA, MD. For their sons, they funded Uniform Gifts to Minors accounts. Now they're saving in 529s for their granddaughters' college education.

When Dennis Wilkie paid his first college bill more than half a century ago, he was putting himself through Rice University. "When I was 14, my dad got me a union card, and I worked all through high school and college," recalls the 70-year-old retired engineer who worked in technical sales. "Back then, $900 a year would get you a college education in Texas."

By the time Dennis had his own sons, the cost of a college education had increased tenfold, with no signs of slowing down. So he and his wife Deloise, now 69, a former music teacher, put $10,000 into a Uniform Gifts to Minors Act (UGMA) account for Aden, now 35, and $12,000 into an UGMA for William, now 33. Both accounts were invested in mutual funds that held blue-chip equities. "The idea was to get capital gains," says Dennis. "In those days, there was no kiddie tax, so the earnings could grow tax-free." When the boys turned 18, their UGMA accounts were each worth over $50,000, which, along with scholarships they received, fully covered the cost of their undergraduate educations at the University of Arizona and the University of Maryland.

Today the Wilkies are saving for a third generation--granddaughters Shealyn, 4, Kyleigh, 2, and Morgan, 10 months. This time they opted for the Maryland 529 prepaid tuition plan. The Wilkies pay $2,500 a year for the older girls and $3,400 for Morgan; after 10 years, that will cover four years of tuition at any Maryland school. If the girls go elsewhere, the funds can be used at any accredited college. "Education is my hobby," says Dennis. "My philosophy is, help the young people now."