Managing Finances

Paying for College: How to Avoid Fraud and Scams

Paying for your student’s college tuition is stressful enough without having to worry about being duped out of more money. Unfortunately, fraudulent activity and scams trick unsuspecting parents all too often. Consider these tips to safeguard your money and make informed decisions:

Don’t pay for the FAFSA

Many services unaffiliated with your student’s university will charge fees to provide the same services that the university offers through the financial aid office or other resources. Always check to make sure you aren’t being charged for something that you could get for free.

For example, the Free Application for Federal Student Aid (FAFSA) is, well, free. Some sites try to charge a fee to download and receive assistance to fill out the form. The official FAFSA is at, and you can get free help from

Remember the FTC guidelines

Scams and fraud is even more prevalent with our dependence on the internet. If you receive e-mails, find websites or read notices about scholarships or grants that seem too good to be true, they might be. The Federal Trade Commission has compiled a list of warning signs and things to look out for when searching for scholarships, as well as ways to report fraudulent activity.


While the internet might present more opportunities for you to be duped, it also helps you track down the truth faster. Check to verify information you hear that makes impressive claims.

For example, one rumor that has circulated for a few years via message boards and forwarded e-mails says that Harvard University is offering full-ride scholarships to African-American students interested in studying sciences. Even though the notice includes legitimate contact information for a Harvard professor, says it’s a scam.

Consider Tuition Refund Insurance

For some parents forking over thousands of dollars a semester in tuition costs, tuition refund insurance might make sense. For others, this could be several hundred dollars gone for good.

Many universities offer tuition refund insurance in the event that the student has to withdraw from classes due to an unexpected illness or accident, allowing parents to receive back what they paid. If your student has a pre-existing condition – check with the policies to see if it’s covered – this could be worth it.