The reality of paying for college can be a stressful component of earning a degree. The good news is that there are a number of ways to pay for college, including scholarships, savings, grants, loans, and aid. Familiarize yourself with the various scholarships and types of financial aid that are available for prospective college students.
To apply for grants, federal loans, or work-study, you must apply using the Free Application for Federal Student Aid (FAFSA).
To complete the Free Application for Federal Student Aid (FAFSA®), you will need:
Dependent students will need the same from their parent(s)
A student loan is designed to help students pay for tuition, books, and living expenses while attending a college or university.
Federal Student Loans
Many students rely on federal government loans to finance their educations. These loans have low-interest rates and do not require credit checks or collateral. Student loans also provide a variety of deferment options and extended repayment terms. Student loans include the Federal Stafford and Federal Perkins Loans.
Visit FinAid for more information about these kinds of loans, or go to FAFSA to apply for federal loans.
Parents of dependent students can take out loans to supplement their children's aid packages. The federal Parent Loan for Undergraduate Students (PLUS) lets parents borrow money to cover any costs not already covered by the student's financial aid package, up to the full cost of attendance. There is no cumulative limit. Like the Stafford Loan, PLUS loans are either FFELP (provided by private lenders, such as banks) or Direct (funds provided by the government).
Visit FinAid for more information about these kinds of loans or to see a list of private PLUS lenders, or go to FAFSA to apply for federal loans.
Private Education Loans, also known as Alternative Education Loans, help bridge the gap between the actual cost of your education and the limited amount the government allows you to borrow in its programs. Private loans are offered by private lenders and there are no federal forms to complete. Eligibility for private student loans often depends on your credit score. Students and parents may choose private loans when the federal loans don't provide enough money or when they need more flexible repayment options. However, private loans tend to cost more than those offered by the government although they are still less expensive than credit cards.
Visit FinAid for more information about these kinds of loans or to see a list of private lenders.
Grants are a form of financial aid, based on need, which you do not have to repay. The federal government offers several types of grants. Certain states, as well as colleges and universities, offer grant programs as well.
To learn more about the Pell Grant, Academic Competitiveness Grant, and more, visit the StudentAid website or to apply for federal grants, go to FAFSA.
Work Study is a financial aid program that allows an undergraduate or graduate student to work on-campus or with approved off-campus employers to earn money to pay for college expenses. Work Study is not a grant (you must work to earn it), and it is not a loan (you don't have to repay it). It is a federal or state-funded program with matching funds from the school. Being awarded work study with financial aid can help a student be eligible for part-time jobs, both on and off campus, that they may not have otherwise been eligible for. Employers love hiring work study students.
The Work Study program encourages employment in community service and fields related to your major of study. Rather than automatically being applied towards housing or tuition expenses, Work Study earnings may be used for whatever expenses you have. Your earnings will depend on where you work and the type of work that you perform. Work Study earnings are considered taxable income, but unlike the money you earn from non-Work Study employment positions, your earnings will not be used to determine your financial need when filing the FAFSA.
To apply for Federal Work Study, go to the FAFSA website.
The U.S. Armed Forces offer several programs to provide students with money for school, including the Montgomery G.I. Bill, ROTC programs, and Service Academies.
Montgomery G.I. Bill
Under the Montgomery G.I. Bill, the Army, Navy, Air Force, Marine Corps, and Coast Guard (and their Reserves and the National Guard) provide a cash education incentive to encourage you to join and serve a tour of duty. The Montgomery G.I. Bill (MGIB) provides up to 36 months of education benefits to eligible veterans for college, business, technical or vocational courses, correspondence courses, apprenticeship/job training and flight training. MGIB benefits may be used while on active duty or after a fully honorable discharge from active duty.
Reserve Officers' Training Corps (ROTC)
In exchange for a service commitment, the Reserve Officers' Training Corps (ROTC) program provides you with money for college while you're in school. You must take one military science course along with your other college courses and, upon graduation, enter the service as a commissioned officer. (There is no military commitment for the first year in ROTC, allowing you to pursue ROTC on a trial basis to see if ROTC is for you.) Full ROTC scholarships pay for almost all tuition, fees, and books charges for four years of college. ROTC scholarships also come in one, two, and three-year lengths. For more information, visit Army, Navy, Air Force, and Marines.
Each branch of the service operates its own Service Academy as a four-year institution of higher education. All students receive a full scholarship with a small monthly stipend. Upon graduation, you're commissioned as a second lieutenant in the Army, Air Force, or Marine Corps, or as an ensign in the Navy or Coast Guard. Appointment to a service academy is extremely competitive. For more information, visit US Military Academy, US Naval Academy, US Air Force Academy, US Coast Guard Academy, and United States Merchant Marine Academy.
Tuition payment plans are short-term, 12 months or less, installment plans which split your college bills into equal monthly payments. Many such plans are essentially interest-free, but some have fees or finance charges. Ask about the costs to you before using a tuition installment plan.
Tuition installment plans can be a reasonable alternative to education loans if you can afford to pay tuition, just not in a lump sum at the start of the semester. A payment plan of even a few hundred dollars a month will reduce the amount you have to borrow. Consider what can be paid out of current income, consider what can be paid in savings, and stretch it out over the course of the year. This reduces the amount to pay after college and you will not have to pay interest on these payments. Most colleges and universities offer them. Ask an admission or financial aid officer for more information.
WUE is a program coordinated by the Western Interstate Commission for Higher Education (WICHE). Through WUE, students in western states may enroll in participating two-year and four-year public college programs at a reduced tuition level: up to 150% of the institution's regular resident tuition. In all cases, WUE tuition is considerably less than nonresident tuition.
For more information and a list of participating colleges and programs, please visit the website.
If you are a child of a military member eligible for VA benefits, you may be able to benefit from one or more of the following programs.
Yellow Ribbon Program
This program allows institutions of higher learning (degree-granting institutions) in the United States to voluntarily enter into an agreement with VA to fund tuition expenses that exceed the highest public in-state undergraduate tuition rate. The institution can contribute up to 50% of those expenses and VA will match the same amount as the institution.
For more information and a listing of participating universities, visit G.I. Bill.
Transfer of Post-9/11 GI Bill Benefits to Dependents (TEB)
An eligible Service member may transfer up to the total months of unused Post-9/11 G.I. Bill benefits, or the entire 36 months if the member has used none (unless DoD/DHS limits the number of months an individual may transfer).
For more information, visit G.I. Bill.
Survivors' and Dependents' Educational Assistance Program (DEA)
DEA provides education and training opportunities to eligible dependents of veterans who are permanently and totally disabled due to a service-related condition, who died while on active duty, or as a result of a service-related condition. The program offers up to 45 months of educational benefits. These benefits may be used for degree and certificate programs, apprenticeships, and on-the-job training.
For more information, visit G.I. Bill.