Introduction
According to the College Board, the cost of a college education is rising faster than inflation. The average price for one year at a public four-year university is $20,770, and $44,840 at a private four-year university—not including room and board. With these numbers, it’s no wonder many students are looking for ways to finance their education without taking on tens (or even hundreds) of thousands of dollars in debt. Here are some tips:
Take advantage of scholarships.
Pursuing scholarships is an excellent means of covering the costs of college education.
They can be based on merit or financial need and applied to tuition, fees, room and board, books, and other expenses. Some scholarships don’t require you to use them; they’re awarded automatically based on grades and test scores!
Apply for financial aid.
Financial assistance is available from various sources, including federal and state governments, colleges and universities, and private organizations. Several types of financial aid include grants (free money), student loans, and work-study programs.
You can find out if you’re eligible for financial aid by filling out the Free Application for Federal Student Aid (FAFSA) form at https://fafsa.ed.gov/. If you don’t get enough money through this application process (or any other), look into alternatives, such as scholarships or outside funding opportunities from family members or friends who can help pay for your education costs while in school.
Apply for grants.
Grants are free money that doesn’t have to be repaid. They’re awarded based on financial need and can go to any student who meets the eligibility requirements.
To apply for a grant, you must fill out an application form that asks for information about your family income, assets, and personal information (such as ethnicity). The availability of funds from the government or other grant-offering organizations determines how much money can be accessed. For example:
- Federal Pell Grants – These are awarded based on financial need; however, there is only so much each year, so only some get approved for one! To be eligible for this grant program, To be eligible, one must maintain a GPA of 3.0 or higher, with enrollment in less than 12 credits per semester. AND meet certain other criteria, such as being enrolled full-time at an accredited college/university within two years after high school graduation OR being enrolled part-time while working toward an associate degree or certificate program leading toward a transferrable bachelor’s degree.*
Get your employer to contribute to your tuition costs.
Inquiring about tuition assistance is recommended if your employer provides such a benefit. Some employers will offer to reimburse employees for up to $5,250 per year in tuition costs (and sometimes even more).
If your employer has this program, they may also be willing to contribute to other expenses associated with earning your degree. These could include books and fees for taking classes at an accredited school.
If your company doesn’t have such an arrangement already set up, see if there are ways that you can work together on creating one–or at least negotiating terms for reimbursement or assistance with educational expenses down the road.”
Apply for work-study opportunities.
Earning money can be made possible through work-study programs while you’re in school. Work-study programs are available at most colleges and universities, and Acquiring experience in your area of study can be achieved effectively through them.
You may apply for work-study as part of your financial aid package or complete an application directly with your university’s financial assistance office. Various factors, including but not limited to, will affect your eligibility.
- Your family’s income level (as determined by FAFSA)
- Whether or not you have any other type of federal student loan debt outstanding
If approved for work-study funds by the school where you plan on attending classes, it will be listed as one of the types of loans offered on your student loan award letter after completing the Free Application for Federal Student Aid (FAFSA).
Start saving early and often.
- Start saving early and often.
- How much will you need? It depends on the school you’re going to, but most students need at least $10,000 per year for tuition and living expenses.
- How much can I expect to earn? If your investments are for retirement or a child’s education, then the long-term growth of stocks is likely to outperform other assets in the long run. The market has averaged 10% annual returns over the past 80 years (and 16% annually since 1926). However, there are no guarantees that these returns will continue in future years; thus, it’s essential not only that you start investing early but also that you stay invested through thick and thin–or else risk losing money due to fees charged by brokers who sell mutual funds (these fees can add up).
- What taxes do I need to pay? In general terms: capital gains tax on profits earned from selling securities such as stocks; dividend income tax on dividends paid out by corporations; interest income tax if bonds held until maturity are redeemed before the maturity date; foreign income exclusion rules may apply if foreign securities held outside the U.S., etcetera…
There are several different ways that students can finance their education, and it’s essential to take advantage of as many of them as possible to minimize debt.
The best way to avoid student loan debt is to take advantage of all the available options, including scholarships and grants.
- Consider applying for scholarships. Many scholarships do not require repayment, so they are free money!
- Apply for as much financial aid as possible (e.g., Pell Grants). These programs can help cover tuition or living expenses if you’re eligible. Remember, however, that these programs usually have deadlines–so take your time!
Conclusion
It should be noted that there are numerous ways to fund your education.. Taking advantage of as many of them as possible is essential to minimize debt and focus on what matters most–your studies.
