In my years as an educator, I’ve always enjoyed the months of February and March. Basketball tournaments are in full swing, winter mercifully comes to an end and spring (break) is right around the corner. These are also the months when high school seniors begin to solidify their plans and make THE DECISION on where to attend college.
It’s quite a relief to finally answer with certainty the two big questions everyone has been asking – “Where are you going to school?” and “What are you going to major in?” I was never so glad to put those questions to bed and that uncertainty behind me.
However, the question nobody asks is probably the biggest of them all – “How are going to pay for that?”
Unfortunately, many high school students and their families haven’t adequately thought about how to pay for college. They’ve spent so much time on the other two questions they’ve left out the most fundamental aspect of going to school – the fact that it costs money. If they haven’t thought about it until the last minute it can be a very daunting challenge to figure out.
Heck, it’s daunting even if you’ve been planning for years. Have you seen the cost of a four-year degree recently? It’s enough to make even the most financially sound shudder. We started setting aside money for college when my oldest turned five and I still don’t know if there will be enough to cover the costs of four years for four children.
The Basic of How to Pay for College
Whatever your situation – whether you’ve been saving for years or have just begun to think about it – you have to develop a plan. With that in mind, here is Part I of two on how to pay for college and reduce the costs of a higher education. These are the six top things you can do:
If you are wondering how to pay for college without going into debt, this is one of your best options.
Scholarships come in all shapes and sizes. Schools give scholarships for many reasons including academics, athletics, fine arts and high entrance test scores just to name a few. In addition, many scholarships can be found through institutions not directly related to the college or university. These could be businesses, foundations, or other private groups looking to reward students who match a demographic or express an interest in their cause.
Scholarships outside of the school can be hard to track down. Fortunately the Internet has made this process significantly easier than it was 25 years ago. A quick Google search will pull up many websites dedicated to helping students locate and apply for scholarships. Here are a few of the best:
UniversityTutor.com (this link takes you to their essay contest where they give away $1,000 per month!)
Applying for scholarships takes a great deal of time. Many require an essay to be written and recommendations to be filled out from your teachers, guidance counselor or administrator. Start your research early and plan ahead. You don’t want the pressure of being in a situation where you are handing a form to a potential recommender the day before the scholarship application is due. (Hint: They won’t like it either!)
2. Work-Study Opportunities
In a perfect world a student would not have to work while going to school at the same time. Guess what…we don’t live in a perfect world. You might have to take a job on or off campus to pay for those college bills. A part-time work week of 10 – 20 hours is certainly doable with a little discipline and time management.
While it doesn’t sound thrilling or even possible, take heart. Many college students that have gone before you have been able to pull it off. I worked in our school’s cafeteria, mostly in the dish pit. That’s right, cleaning student’s plates…FUN! But I wasn’t calling mom and dad every other minute asking them to send money. (They appreciated that!)
Working a part-time job may cut down on the parties you attend but at least college will be paid for.
3. Savings and Investments
All the ways to pay for college on this list can be decided on during a student’s senior year of high school except for this one. Long-term saving and investing is the best way to pay for college but it takes years to build a substantial amount. If you haven’t started investing by the beginning of your child’s senior year it makes little sense to do so. It’s not wise to invest dollars into the stock market that close to when the money will be needed.
For those living in the U.S and looking to invest for college, the government passed into law in 1996 a special investing vehicle known as 529 plans (named after section 529 of the IRS code). These are tax-advantaged investing accounts designed to encourage saving for college. The money that accumulates in these plans over the years can be used for tuition and books, room and board, and other supplies or equipment at accredited colleges and universities in the U.S.
4. Student Loans
Many families will choose to go the route of applying for and securing a loan to pay for college. The student doesn’t know how to pay for college and agrees to go into debt for it with the promise of repaying that debt once the degree is complete.
While it is possible to secure a private loan from a non-profit or other entity, the majority of student loans in the United States are federal loans. These can be “subsidized” or “unsubsidized.” The difference between the two is that a student does not accrue interest on a subsidized loan while they are still in school.
Students choosing to take out a loan must weigh the potential costs of going into debt with a future that is uncertain. That $50,000 – $100,000+ worth of student loan debt will take years to repay and cannot be expunged in a bankruptcy. If a student fails to find a well paying job in their field after graduation or their life circumstances change, they may find the debt to be a financial curse that haunts them for years.
Information about the federal student loan program can be found at StudentLoans.gov.
Grants are different from loans in that they don’t have to be repaid. That’s right…everybody loves free money!
Grants are usually dispersed through the college, the state or federal government and private and non-profit organizations. While scholarships are mostly academic based, grants are typically need based, meaning families will have to apply for and meet eligibility requirements. The amount of aid you receive depends on how big the family need and the total cost of attending your desired school.
To learn more about grant programs visit StudentAid.ed.gov.
6. Employer or Military Sponsored
Many businesses will assist students with the cost of school tuition in exchange for years of employment after graduation. If it’s an industry you love and plan on making a career in this would be a great avenue to explore.
Pursuing a military career can also turn into big dollars for college. Now, I wouldn’t consider joining the military JUST to have money for college but if that profession is a predetermined passion of yours then you stand to financially benefit. Similar to a business, students will be receiving aid for school in return for a commitment to serve.
Each service has it’s own standards for eligibility and amount of financial assistance they pay out. A good breakdown with links to the various service academy programs can be found here at Military.com.
Part II: Reducing the Costs
The six areas I’ve summarized here are the best options for how to pay for college expenses. However, there are other practical things a student can do to reduce the overall expenses of college. I’ll discuss those items in Part II of this series.
Questions: How did you figure out how to pay for college? How did you finance your education? Were you able to manage your student loans post graduation or did they turn your life into a nightmare? What job did you have during school?
Image at FreeDigitalPhotos.net
Prior Post: The “If Only” Game Makes Liars of Us All