Say you have to pay $10,000 to the college for the academic year.
It is beneficial for you to pay at the latest allowable date. This is because of the concept of the time value of money:
$10,000 today is worth less than $10,000 in the future, for example in a year's time. This is because you could invest $10,000 in a riskless asset and gain a positive return of say 3% p.a. Thus, by waiting a year to pay your tuition, you gain the interest on the money. Alternatively, you should delay taking out the loan until the latest point in time as the principal will be less than if you took out the loan today. (Note: in this case, you are incurring interest rate risk - the interest rate in a year's time might be higher than today. You could look into a Forward Rate Agreement contract to lock in a rate).
The $10,000 you pay in one year's time in the future value.
To get the present value, you need to discount $10,000 by an appropriate interest rate. Imagine it is 5%, then:
PV = FV/(1+r) = $10,000/1.05 = $9,523.80952