Each year, students apply for colleges all over the country, and many get stuck with the same question. “How am I going to pay for tuition and living expenses?”
Many feel that college is out of their reach because of the costs of tuition, books, and monthly living expenses. While it is true that these costs will add up and can influence your decision of where to attend school, college is not as far out of your financial reach as you may think.
There are many resources available to help cover the cost of college. Let’s take a look at a few of them.
The best place to start is FAFSA®
Filing your FAFSA® should be the first step after applying to the colleges you’re interested in attending. The FAFSA® is free, and it’s a tool for schools to determine what kind of grants, loans, or work-study programs you might be eligible for.
FAFSA® has no age requirements, so anyone attending college can apply. While many people think this tool is great for access to grants, it also helps determine your eligibility for federal student loans.
Federal loans have lower interest rates and better repayment plans than private loans, but we’ll get into that in just a little bit.
Free money in the form of grants
The most common grant awarded by the Federal Government is the Federal Pell Grant. The maximum amount paid out for 2019-2020 was just over $6,195. This is money that students do not have to pay back!
There are other state and school-specific grants out there, too. Just like the Federal Pell Grant, this money has no repayment requirement. This is free money for qualifying students, but you really need to file your FAFSA® to find out if you’re eligible.
Apply for multiple scholarships
When scholarships come into discussion, many people might think of academic or athletic scholarships. This means only a very small population of students would be eligible to attend schools through scholarship funding. But, that’s not the case, there are thousands of scholarships out there. They just take some research to find.
Similar to grants, scholarships are financial resources that students do not have to pay back. Many come with specific stipulations, such as maintaining a certain Grade Point Average (GPA) to receive the award. This means you have to keep your grades up, or you could end up losing out on this financial assistance.
Ask about company benefits
If you are working while attending school — some companies offer tuition assistance. This allows companies to offer up to $5,250 of tax-deductible tuition reimbursement for employees attending school.
Companies have different requirements; some offer help for specific majors or schools. The first step in identifying how to best utilize this resource is to work with your HR team about the benefits available.
Take out a student loan
While not ideal, student loans are a big help in covering the cost of college. If you filed a FAFSA®, you can find out what federal loans you might be eligible for. Student loans come in two types, there are Federal Student Loans and Private Student Loans.
Federal student loans generally offer lower fixed interest rates and income-driven repayment plans, whereas private student loans have repayment terms dictated by the lender. You can visit here for a breakdown of the differences in the loan types.
Private loans are a good way to cover tuition costs if you have exhausted all other means.
You should always familiarize yourself with all of your options before signing any contracts with private lenders.
Knowledge is power
Do your research. Knowing how to cut down on the out of pocket expenses will make your college experience far less stressful. Once you figure out how to cover the cost, all that’s left is earning that degree.