The perfect storm is upon us: college tuition and fees are up as college aid trends down, all as family college-saving accounts have struggled. Further, student loans are more elusive, with supply decreasing about 30 percent as banks have raised lending standards.

Still, federal government loan programs have increased by offering more loans and lower rates while expanding tax breaks for parents. An expanded tuition credit for households with up to $160,000 in adjusted gross income could reduce as much as $2,500 from your tax bill.

Our JBTP rule of thumb: try not to borrow more than $4,000 per year.  Although, the national average is more than $20,000 at graduation, don’t allow yourself to be excessively burdened with debt upon graduation. Less than $20,000 should be affordable, depending on the type of loan and terms (see below) as well as your job prospects: engineering majors should be comfortable borrowing more.  But never forget that the earnings premium associated with a college degree- $600,000 to $1.2 million- typically makes your return on your college investment like investing in Microsoft in 1988.

1. Free Application for Federal Student Aid (FAFSA)

Fill out the FAFSA form (http://www.fafsa.ed.gov/) that colleges usually require before awarding aid, from merit scholarships to need-based grants and loans. Get it done by mid-January each year, as money is often awarded first-come-first-serve. The FAFSA can take time, but applicants who have filled out a FAFSA in previous years are able to fill out a renewal FAFSA. Your FAFSA answers are entered into a formula that determines the Expected Family Contribution (EFC)- the lower your EFC, the more need-based aid you’ll be eligible for.  Also, submitting the FAFSA enables a family to be considered for federally-backed, lower-interest college loans.  So fill out the FAFSA!

2. Federal Perkins Loan Program (Great deal, but you need to qualify.)

Perkins loans of up to $4,000 a year go to students with the greatest financial need. Perkins Loans carry a low fixed interest rate of just 5 percent for the duration of the 10-year repayment period. Borrowers don’t begin repayment until the tenth month after graduation, falling below half-time student status, or withdrawing from college. Interest doesn't begin accruing until the borrower begins to repay the loan.

3. Stafford Loans (Subsidized Staffords are a great deal, while unsubsidized Staffords are an okay deal.)

Stafford Loans are the most common need-based student loans and usually have better terms than private bank loans. These loans may be subsidized ( government pays the interest while the student is in school) or unsubsidized. Twelve percent of students from families with adjusted gross incomes over $100,000 received subsidized Staffords in 2008/09 and the interest rate will decline from 5.6 percent to 3.4 percent by the 2011-12 academic year.

Unsubsidized Stafford loans, which are available to all students, are expanding. Add $2,000 to the former limits of $3,500 for freshman year, $4,500 for sophomore year, and $5,500 thereafter. Loan terms will remain at 6.8 percent; your college can provide a list of lenders.

4. PLUS Loan Program (Plus loans are very pricey- borrow with care.)

PLUS loans allow you to borrow for the full cost of a dependent child's college education, minus any financial aid. For the 2009/10 school year, the interest rate is a hefty 7.9 percent for loans that come directly from the government, and an even heftier 8.5 percent for those in which a financial institution is the intermediary. And fees range from 3 percent to 4 percent for the loan.

5. Scholarships

Go after privately offered free money. Check out www.Fastweb.com and www.FastAid.com, and the Department of Education database: https://studentaid2.ed.gov/getmoney/scholarship/v3browse.asp.  Most states have a scholarship database for use primarily at in-state colleges: Nebraska’s is https://www.fes.org/scholarquest/s_login.asp.

6. Private Loans