Paying for College as an LGBTQI+ Student

Figuring out how to pay for college can be difficult and confusing. This can be especially true for LGBTQI+ students because they may be in a situation where they don't receive parental support or guidance. The College Board estimates that the average total price of undergraduate tuition and fees is now around $41,540 for a four-year private college, $11,260 for a public in-state college, and $29,150 for a public out-of-state college. Many students use a combination of financial aid and help from parents to cover the costs, but this can be impossible for some LGBTQI+ students.

According to a 2023 report by the Center for LGBTQ Economic Advancement and Research, which analyzed findings from a survey of 3,008 individuals (2,505 LGBTQI+ and 503 non-LGBTQI+ individuals), 73% of LGBTQI+ respondents said they could rely financially on their family before telling them about their sexual orientation; after coming out, the percentage of respondents who reported being able to rely financially on their family dropped to 62%. Parents of transgender and nonbinary children were more likely to ostracize their children. Eighty-five percent of these respondents said they could rely on their families before coming out, but this dropped to 57% once they told them about their gender identity.

This article details LGBTQI+ individuals' critical issues in paying for college—during school and afterward—and suggests approaches that can help.

Issues Faced by LGBTQ+ Students 

A lack of support can be particularly harmful to college students, who often rely on family to help pay tuition. Sallie Mae’s 2023 "How America Pays for College" report found that, on average, parental income and savings covered 50% of a student’s college expenses. LGBTQI+ students without supportive parents are left to cover this portion of costs on their own.

Getting financial aid is more difficult without the advice and cooperation of parents. For example, to receive federal aid, students are required to complete the Free Application for Federal Student Aid (FAFSA). Unless you are considered an independent student, you must report information about your parent's income and assets on the FAFSA, which determines financial aid eligibility. The FAFSA also requires a parent’s signature.

If students do not complete a FAFSA, they can't apply for scholarships, grants, federal student loans, or work-study programs. When parents refuse to cooperate with the FAFSA application for federal aid, the alternative (to financing college with scholarships, grants, federal student loans, and work study) is to apply for higher-interest private student loans—or even use credit cards to cover college costs. The Center for LGBTQ Economic Advancement and Research reports that LGBTQI+ are more likely to take on student debt to pay for college compared with their non-LGBTQ+ counterparts.

Unlike student loans, which have to be paid back over time (plus interest), scholarships and grants are a type of gift aid. (Scholarships are typically awarded to students based on merit; grants are given to students who demonstrate financial need.) Gift aid is money for college from the government, a college, or a private organization that does not have to be paid back. According to Sallie Mae's report, on average, 29% of a student’s college expenses are paid for with scholarships and grants; missing out on this source of funding can have a significant impact on an LGBTQI+ student.

Workplace Discrimination

According to a national public opinion study from the Center for American Progress, more than one-third of LGBTQ+ respondents said they experienced discrimination in the past year. Half of these respondents experienced discrimination in the workplace. Those encountering workplace discrimination because of their sexual orientation or gender identity may be less likely to be hired for a job, and, once they are hired, can have a harder time staying employed—especially if they face a hostile workplace environment. It follows that a lack of employment opportunities can make it harder to pay off student loans.

Some companies have taken proactive steps to institute inclusive workplace policies and practices—even if it is not legally required—that make them more welcoming environments for LGBTQI+ people. The Human Rights Campaign publishes an annual Corporate Equality Index highlighting these corporations. Socially responsible investors (investors who invest money in companies and funds that have positive social impacts) can consult this list for LGBTQI+-friendly companies to add to their portfolios; it's also a good list to check out when looking for a job.

To date, just 23 states have enacted anti-discrimination laws that include LGBTQ+ individuals. These laws include credit and lending nondiscrimination laws, which protect people from being unfairly denied credit and lending services. These laws also encompass housing protections and protection from discrimination in public, including in retail stores, restaurants, parks, hotels, doctors’ offices, and banks. The Movement Advancement Project reports that 29% of the LGBTQI+ population live in states that have laws or policies that do not adequately protect their rights.

How LGBTQ+ Students Can Get Help Paying for College

If you're paying for college on your own, it won't be easy, but there are ways to reduce the costs. If you don't qualify for any grants to help pay for college, there are some scholarships and student loans that you can apply for on your own.

Scholarships for LGBTQ+ Students

There are some scholarship awards available specifically to LGBTQI+ students. You can search free databases on websites, such as Scholarships.com, Fastweb, and the Human Rights Campaign, website to find specifics.

Some organizations offer other types of support to LGBTQ+ students. Point Foundation provides scholarships, mentorships, leadership development, and community service training opportunities to LGBTQ+ students of merit.

Student Loans

LGBTQ+ students can still complete the FAFSA, even if their parents refuse to help or provide any information. Dependent students can select the option “I am unable to provide information about my parent(s)” when filling out the FAFSA application. This is the only type of federal student aid you can receive if you are unable to report your parents' financial information is unsubsidized federal student loans.

If you aren’t able to borrow enough in federal student loans, you may want to explore private student loan options. These loans, typically offered through banks, credit unions, or other private lenders, usually require a good credit history (or a cosigner).

Private student loans have higher interest rates—and less flexible repayment and forgiveness options—than federal student loans, which means you will end up paying more in interest when repaying your loan.

Paying Down Student Loan Debt

The best way to start paying off debt is to find a job—either during or after college. Then, as you start to pay off your loans, look for ways to reduce your loan burden. For most federal student loans, you will have a grace period after you leave school. A grace period is a set period of time after you graduate before you must begin repayment on your loan.

Another thing to look for: There is a growing number of companies that include student debt repayment as an employee benefit. You may also find an employer that helps pay tuition for college courses for their employees. It's worth looking for these opportunities. When you're researching companies to apply for jobs, see whether any of them offer student debt relief or education benefits.

Investigate Loan Restructuring and Loan Forgiveness

If you have student loan debt, you can look into ways to reduce the amount you owe.

Federal student loans allow borrowers to change their repayment plan at any time. For example, you may be able to reduce your monthly payment obligation (based on your annual income) with an income-driven repayment plan. Under these plans, your outstanding debt is typically forgiven after 20 or 25 years.

If you've taken out a federal student loan, look over the various federal student loan forgiveness programs. It's worth knowing if you might qualify for one—or could structure your career to make that possible.

Private student loans are not eligible for government forgiveness programs, but LGBTQI+ borrowers may be able to get a lower interest rate or better repayment terms by refinancing their loans.

The Bottom Line

Paying for college can be tough for most people, and it can be even tougher for members of the LGBTQI+ community. Recognizing the barriers to financing a college education can help LGBTQI+ students proactively strategize to address these barriers.

It's important for students to plan ahead as much as possible. If you plan to attend college, but are not on good terms with your parents, start saving as soon as possible. Consider funding a 529 college savings plan with money earned from summer or part-time jobs. Anything you can save now will reduce the amount you will have to borrow later.

If you're already in college and need help paying for it, use the resources available to you, such as financial aid and scholarships. Being prepared, and knowing as much as possible, will help make the college experience more enjoyable.

When you graduate, look for workplaces that embrace diverse people and ideas. And maybe even find an employer that offers benefits designed to help you pay down your student loans sooner.