Over the years, college has gotten much more expensive. While in the 90's it wouldn't be a stretch to pay for college with a part-time job, this simply isn't possible now. It's important to put a lot of thought into how you'll be paying for your post-secondary education. Thankfully, there's a variety of different options you can choose from.
To get started, here are three main ways you can pay for school:
Though paying out-of-pocket might seem like a good idea, chances are it would be very difficult to pay it all on your own. College can be expensive, and while tuition varies depending on the school, it can be difficult to afford. This might be an option if your parents are helping pay for your education.
The second option, savings, and savings plans, can be a great way to pay for school. Maybe you started saving for school when you were younger. Maybe your parents started a fund for you or enrolled you in a plan like a 529 college saving plan (be sure to ask them). Either way, depending on how long you or your parents have been saving, along with how much, you may be able to cut your costs or pay for your whole education.
Student Aid covers many different options, so let's take a deeper look into each of the following:
Aid can come from the school, the state or federal government, or a specific organization. The first step in applying for student aid is filling out your "Free Application for Federal Student Aid" (FAFSA), which many aid providers require. You can fill out your FAFSA at www.fafsa.gov or http://www.fafsa.ed.gov. DON'T fill out the FAFSA anywhere else, especially if they charge money. Also, don't use any third-party sites that fill it out for you. There are a lot of scams out there and students are an easy target for them. The "F" in FAFSA stands for "free", so if you're paying for it, then you're probably getting tricked. If you need help filling out your FAFSA check out www.studentaid.ed.gov or visit your school's financial aid office.
Read these workNet articles to learn more about FAFSA:
Grants
Grants can be called a "gift aid" because it is financial aid that doesn't have to be repaid. You may be able to get a grant from the federal or state government after you file your FAFSA. Grants may be paid to you or directly to the school. A few grant types are:
In most cases, Pell Grants are awarded to undergrad students who have not yet earned a bachelor's degree. The amount awarded depends on a few things such as:
The second grant type, Federal Supplemental Educational Opportunity Grants (FSEOG), requires you to fill out the FAFSA. It's a "campus-based" program, meaning it's given directly by schools that take part in the program. FSEOGs are set aside for students with the most financial need. You can find out if your school gives FSEOGs by asking the financial aid office.
Getting a grant may have benefits that a loan does not offer, like not having to repay grants that you receive. However, remember if you stop taking courses you have used grant money for, you may be required to repay some or all of the money.
Work-Study
Federal Work Study is a program that gives college students part-time jobs. This lets them earn money to help pay for school expenses. It's only offered by schools that take part in the program, but it has a lot of benefits. One example is you could be placed in a position that relates to your major. You are also earning money to pay off your schooling or other expenses you may have.
Work-study jobs can be either on or off-campus. When you start you'll have a set number of hours and earn at least minimum wage. However, that amount may change based on:
While work-study may seem like a normal job, it differs because you cannot work any "extra hours." Your total award is split into paychecks that equal the set amount.
Scholarships
Scholarships, like grants, are a "gift aid" that does not have to be repaid. Scholarships are different from grants based on how they are awarded to students.
A large number of scholarships are merit-based. This means they're earned by meeting or going beyond the requirements set by the provider of the scholarship. Merit-based scholarships can be earned because of grades, talents, traits, interests, or a combination of these factors. Other scholarships can be based on financial need or aimed at certain groups, like:
Some scholarships can be awarded based on where you or your parents work or your background. Scholarships for military families are another example.
By now you're probably wondering "how much money will I get for a scholarship?" Scholarships vary with how much financial aid is awarded. They range from generous enough to cover your whole education to as low as a few hundred dollars. Either way, you'll be cutting back on your costs. You should research and apply for as many as you may need.
To find scholarships you can:
Keep in mind that different scholarships have different requirements. Some scholarship applications may call for a written essay. Scholarships may even be awarded based on grades alone when you apply for school. Always make sure you know the requirements before applying. If you're not sure, you can check the provider's website or ask the financial aid office at school.
Use this guide as a way to compare different financial aid packages that you are offered. This will be helpful for you to stand back and decide which offer is best for your financial needs.
Loans
If you get a loan, you borrow money from a lender to pay for school. After you graduate, you'll have to start paying it back. Loans can be a good thing because you might not have to pay the loan servicer anything until you're getting started on your career, depending on the loan you have. By then, you'll likely be making enough money to start repaying your loans. You will be able to focus on your education without worrying about money.
However, loans have a few downsides. The first (and most obvious) one is that it has the potential to put you in a lot of debt. Depending on which type of loan you get, you'll probably have to pay interest back. Interest can add up – you could end up paying thousands of dollars in interest alone. Make sure to review the terms of the loans and do the math to see how much you'll really be paying back in the long run. Being educated is the first step to making smart choices.
Read more about paying back loans here.
Other Tips
Some final tips:
Sources
http://www.bankrate.com/finance/college-finance/college-tips