If you’re using the Parent PLUS loan to plan your finances around your student’s college this fall, you’ll notice the new upper limit that the One Big Beautiful Bill Act now enforces.
As we covered when the hard caps took effect, from July 1, 2026, onward, the bill limits borrowing to $20,000 per student per year, with a total limit of $65,000 per student over the course of the whole degree.
The change will become apparent once the 2027-28 FAFSA opens on October 1, and it’s worth starting to plan for it already.
Our earlier piece delves into how you can find more sources of money for college, including scholarships, aid appeals, borrowing conservatively, and net price comparisons.
Here, we’ll look at a complementary strategy: how you can reduce the amount you have to pay for your student’s college fees.
The Expanded Financial Shortfall Families Can Expect
Consider a $50,000-a-year private university. Before July 1, 2026, families could borrow the entire amount through Parent PLUS. The updated $20,000 per year cap now leaves an additional $30,000 gap that families must manage.
Remember: this is just one year. Added up to 4 years, the cumulative shortfall gets serious.
And this cap is just one piece of a bigger set of federal loan changes taking effect this year, so it’s worth getting the full picture before you finalize how you’ll cover the gap.
The Often-Overlooked Third Lever: Paying for Fewer Credits at College
The standard strategy for reducing financial strain is to either find more financing (like scholarships, grants, employer benefits) or opt for a less expensive school. The third option, which is often overlooked, is to reduce the number of credits you pay for at your chosen educational institution.
General education forms the foundation of most undergraduate degrees across the country. Courses like writing, math, speech, science, social science, humanities, history, among others — all covered under general education courses — account for between 30 and 45 credits.
General education requirements can be completed independent of your student’s enrolled institution, and the credits can be transferred to the degree your student is working towards.
This makes general education courses the most easily substitutable part of a college bill.
It’s part of a broader trend, too. A growing number of schools now offer three-year degree programs built specifically for students who arrive with outside credit already in hand, cutting a full year of tuition and housing costs.
Doing the Math: The Cost of a Single Course May Surprise You
If your student is enrolled in a $50,000-a-year college, 30 credits a year will cost about $1,667 per credit. A 3-credit course, thus, usually costs roughly $4,800.
Study.com, on the other hand, offers a College Saver plan starting at $95/month, with most students finishing a course in three to four weeks. At an average of one course per month, taking four general education courses works out to about $400 over the course of a degree.
Compare this to the almost $20,000 that you’d spend doing the same courses at institutional rates.
That’s about $19,000 saved over four years.
While this doesn’t completely cover the $30,000 shortfall that Parent PLUS loan applicants now potentially face, it does go a long way in mitigating it.
Understanding College Credit Transfer is Important
Credit transfer courses underpin how successful this lever can be. The process is relatively straightforward.
Study.com’s online courses for college credits are recognized by the ACE and NCCRS, which are leading national organizations that recommend courses for college credit. The credit transcripts are sent directly to your school of choice, with over 2,000 colleges having already accepted credits earned this way.
It is worth noting, however, that acceptance of credits does ultimately rest on the receiving school and its specific transfer policy. Sometimes there can be caps on credits earned externally, or the type of credit that is being transferred.
The crucial step here is asking the chosen school’s academic advisor specifically about their institution’s credit transfer policy.
If you’re still in the process of picking a school or program, consider thinking about how to plan general education courses for transfer early on.
Summing Up and What’s Next
The advice from July, when we first covered the new caps on Parent PLUS loans, still holds true. Compare colleges on value, not sticker price; borrow conservatively to avoid a financial burden that stretches into years.
Using transfer credits to reduce what you pay for general education courses in college simply bolsters the advice further. The savings on the total education bill can help avoid having to look for cheaper schools or putting off college for financial reasons.
The first step is to figure out the extent to which this lever is applicable to your individual case. Before the October 1 FAFSA opening date, contact the school you are considering and ask about its transfer credit policy.
Specifically, which general education course requirements does the school accept transfer credits for? The institution’s response will help clarify just how much you can save on your total college bill.