No school tuition, no rewards
By Cara Nissman • Bankrate.com

Janis Julian had a good racket going.

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In 1998, when the Wilmington, Del., mother of three sent her eldest daughter off to college, she chose to charge the tuition to her credit card to earn US Airways frequent-flier miles. Every semester thereafter, she earned at least 5,500 points.

"I always paid off the credit card the next month, so I didn't incur any interest," says Julian, a banker. "I thought it was a great benefit because the school received the money upfront, and I racked up so many miles."

When her second daughter started college in 2001, Julian continued her pattern of paying by credit card, earning more than 13,000 points per year.

"Between the two kids I had earned about 80,000 points. My three kids and I were able to fly to a vacation for free. We would have never gone if it weren't for the frequent-flier miles."
 
But in 2003, her daughter's school stopped accepting credit cards for tuition payments, and Julian's supply of miles stopped short.

"I was so disappointed," she says. "I called the office to find out why and they said the merchant fees they were paying were so high they were losing money."

Janis Julian

Delaware banker Julian made the most of credit cards until her daughter's college stopped accepting them for tuition.

Merchant fees have caused colleges across the country to stop acception tuition payments by credit card, but there are other options. See "Colleges decline credit card tuition payments" or "Where to get money for college" for more information.