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The costs of doing a college transfer — and how to limit them

Amy Fontinelle

Posted on October 02, 2023

Amy Fontinelle is a personal finance writer focusing on budgeting, credit cards, mortgages, real estate, investing, and other topics.
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Review the issues that often surround the transfer of academic credits from one university to another.

Point out the academic and social costs that may be incurred in a college transfer.

Note that transferring can also save money in ways that might not be obvious.

Students may consider doing a college transfer for several reasons. It may be part of a plan to save money by earning general education credits at a less expensive school, then applying to a more prestigious school to complete a major. Sometimes, the first college a student attends turns out to be the wrong fit. Other times, a student’s finances might take a turn for the worse, necessitating a transfer to a less expensive school. Mental health, physical health, and family matters can also compel students to transfer.

Whatever the reason, it’s important to enter the college transfer process with an awareness of the uncomfortable truth that there may be costs in time and money. With the right planning, transfer students can complete their degrees on time or minimize the need for extra semesters.

Consider these potential costs when switching schools and learn how to limit them.

Lost credits and increased time to graduate

One of the biggest concerns for any college transfer student is whether their new school will accept all the credits they’ve earned. There’s also the question of whether transferred credits will satisfy graduation or major requirements, or only count toward elective credits.

Losing credits can mean paying for additional credit hours and spending more time in the classroom. It might also mean increasing a semester workload from five classes to six, or attending summer school to stay on track for a four- or five-year graduation plan. Taking additional time to graduate can also mean additional student loan debt compounded by a delayed start to the well-paid career that should make college pay off. (Related: Is student debt worth it?)

Online tools such as can help students assess how much of their existing coursework — and credits earned through placement exams — will transfer to various schools. Some schools have partner institutions that can be easier to transfer credits to. For example, Tarrant County College in Texas has an arrangement with the University of Texas at Arlington that simplifies the transfer application process, helps students transfer credits, and enables students to identify needed coursework to complete their bachelor’s degree on time. Such arrangements are called “articulation agreements.”

There are even some state-level resources to help students transfer effectively. The Texas Common Course Numbering System, for instance, helps freshmen and sophomores at Texas community colleges transfer credits from general academic coursework to Texas universities. Texas is one of 31 states that has or is developing such a system.

Limiting the cost of additional credits

It’s a good idea for transfer students to meet with an academic adviser at their new school before registering for classes. An adviser can help prevent enrollment mistakes that could cost time and money. Students should bring transcripts showing their completed coursework to the adviser meeting. Some schools, especially those that receive many transfer students, offer degree-planning tools to help students see which of their completed courses will transfer over and count toward a degree.

Another strategy that can help transfer students minimize the time to complete a degree is a registration game plan. Since it can be challenging to get into all the courses one needs to take, it can be helpful to plan out different schedule combinations to allow for quick decision making if a student’s first choices fill up. Registering at one’s assigned time will offer the best chance of getting a spot in every needed course, or at least snagging a wait-list opportunity. Attending classes one has been waitlisted for and speaking with the instructor can facilitate enrollment once the semester begins.

Social costs of transferring colleges

Transferring can mean losing the network of friends, instructors, and advisers who supported a student at their previous school. Matthew Carpenter, CEO at College Funding Services in Salem, Massachusetts, and founder of College Aid Pro™, a software application that enables a family to financially model paths to college, said that while it often makes sense to attend two years of community college before transferring to a four-year school — whether for financial reasons or because a student is apprehensive about living away from home or about going to college at all — he doesn’t usually recommend strategically planning to transfer from one four-year college to another.

“The unknowns are too great,” Carpenter said. “What if you make best friends? What if you fall in love? What if you make the team?”

Yet, for some students, the social environment at their first college might have been a poor fit. Maybe there was too much emphasis on social life and not enough on academics. Maybe that small liberal arts college felt cliquish. Maybe it was too hard being a small fish in a big pond. In such cases, there may be more to gain socially than to lose by transferring.

Attending transfer student orientation at one’s new school can help ease the transition. This special orientation offers opportunities to meet other transfer students, learn about the school’s student resources, and find out about student activities, such as clubs and sports, where one can rebuild lost networks and start to integrate with non-transfer students. In addition, some schools have transfer student centers for year-round support.

Potential savings from making the switch

While the potential financial losses from transferring are significant, transferring can also save money in ways that might not be obvious.

“If it becomes apparent that the current institution is not a sound investment and there are other, more cost-effective options, it may be worth cutting bait,” Carpenter said.

For a hypothetical example, a student may have been an outstanding artist in high school who also earned excellent marks in their academic classes. They decided to pursue their passion by attending an art college that gave them a scholarship. By sophomore year, the student decided they didn’t want to pursue a career in visual art, but the school’s other offerings were virtually nonexistent.

Despite the scholarship at the art school, the long-term financial benefits for the student may improve by transferring to a school with more comprehensive BS and BA programs.

Conversely, some students don’t do so well in high school, but start to excel in college. They might encounter resources they didn’t have before, such as a supportive adviser, achievement-oriented classmates, or an instructor who sparks their interest in a subject. (Related: What high schoolers should know about student loans)

“If a student has done well at their current college, they may be able to receive scholarships at other colleges that would not have been available to them upon high school graduation,” Carpenter said. “Similarly, they may have the opportunity to be accepted into colleges that are more generous with financial aid that would not have been options when applying out of high school.”

Transfer students and financial aid

For students who depend on financial aid to earn a degree, Carpenter said that “for the most part, transfer students are treated the same way that incoming freshman are. There are exceptions, but generally speaking, financial aid works the same.”

Some schools and organizations even offer scholarships specifically for transfer students. However, as with freshman financial aid, it’s often first come, first served, so it’s best to apply early. Transfer students should aim to meet or beat all financial aid and admission deadlines if possible.

Federal student aid does not automatically transfer when a student changes schools. A transfer student will need to update their Free Application for Federal Student Aid (FAFSA) and find out what financial aid the new school will offer them, then determine how to pay for any difference. It’s also important to be aware of where one stands with regard to borrowing limits for federal student loans.

In addition, transfer students need to know that their federal student loans will automatically go into repayment when they withdraw from their current school. They will need to apply for an in-school deferment if they want to avoid making payments while attending their new school. They will also want to pay special attention to the requirements for remaining eligible for federal student aid by making satisfactory academic progress in terms of grade point average and progress toward graduation.


There are no guarantees, of course, that transferring will improve a student’s experience. Will the upheaval and potential additional costs be worth it? That’s something each student and their parents must decide.

“Most students go through some growing pains freshman year,” Carpenter said. “Doubt about their college choice and homesickness inevitably creep in. This is a normal part of the major life transition that is going to college.”

“Don’t mistake these uneasy feelings for signs that you should definitely transfer,” he said. “Most of us have gone through it and come out the other side to have an amazing experience.”

Still, for students who do choose to transfer, approaching the process with a careful plan — as well as support from an academic adviser, parent, or other trusted older adult — can minimize the financial, opportunity, and social costs of changing schools.

Discover more from MassMutual…

Tips for choosing the best ‘financial fit’ college

9 ways to save on college...without a scholarship

On the hunt for the most generous colleges

This article was originally published in September 2021. It has been updated.


The information provided is not written or intended as specific tax or legal advice. MassMutual, its employees and representatives are not authorized to give tax or legal advice. You are encouraged to seek advice from your own tax or legal counsel. Opinions expressed by those interviewed are their own and do not necessarily represent the views of MassMutual.