So how do I actually pay for college???
Last time, we talked about the ways students typically pay for college. This time, let’s go a little more in-depth and talk about the ways students actually find the funding to pay for college.
Like last time, we’ll discuss the four broad categories of funding: financial aid, scholarships, loans, and private pay.
Financial aid is one of the most commonly discussed forms of funding. Thankfully, this one is pretty easy to track down. The Free Application for Student Aid is an online portal managed by the federal government where students can apply for federal (and state) financial aid. It is a one-stop application, so you only have to submit one full application! Your first time applying can be complicated, but it gets easier each year! You’ll start with basic information like your name, age, location. If you’re a dependent (most college students are), you’ll also include information about your parents, guardians, and/or family.
The biggest piece of information you provide is your financial information. If you are a dependent, you will submit your parents’/guardians’ tax filings from the previous year. If you are an independent, you’ll submit your own tax filings from the previous year. This is what the federal government uses to calculate your anticipated aid.
Once you apply, you sit back and wait! You’ll receive your aid offer via email. This will include any grants, work study, and loan options that are offered to you by the federal government.
(Tip: You don’t need to accept every offer you receive. If you receive a mix of grants and loan offers, you can accept just the grants and decline the loans. Or you can accept the grants and a portion of the loans. The amount you accept and commit to should be dependent on how much assistance you need to pay for that year of schooling.)
(Tip: Students often tell me that they don’t apply for FAFSA because they know they will only receive loan offers or won’t get other assistance. I tell them that they should always apply each year, no matter what they think they will get. Many colleges and universities use FAFSA information to determine who will be eligible for financial need-based scholarships. You should apply every year to increase your aid options.)
Scholarships are a bit trickier to track down. There are tons out there, but they can be difficult or confusing to find. We’ve previously talked about how to tell if a scholarship is a scam or not, but how do you explore your options?
Most colleges and universities have a pot of scholarships they offer their students each year. These funds are usually provided through private donors, and the criteria of each scholarship can depend on what the donor wants. Some colleges and universities tie their scholarship decisions to the admissions info you provide, while some require that you submit separate applications. You should pay attention to your admissions offers because those letters will typically include information about scholarships you’ve initially been offered, or where to apply for institutional scholarships. And, when in doubt, don’t hesitate to contact your financial aid office to determine how you should apply for scholarships!
You can (and should!) also look for scholarships offered through private organizations. Current high schoolers should ask their guidance counselors or in-house college advisors for scholarship opportunities. You should also explore local opportunities. The following groups often provide annual scholarships to students from their communities:
Rotary Clubs
Mason Lodges
Religious Organizations
Garden Clubs
Boys and Girls Clubs
Community Foundations
Parent/Your place of employment
You can also explore national opportunities. I share scholarship opportunities (don’t worry - I make sure they are legit!) through my various social media platforms (links at the bottom of this page!). I also don’t usually endorse specific scholarship search tools, but I do like, and trust, the CareerOneStop search engine offered by the US Department of Labor. You can search for scholarships based on your specific backgrounds, interests, and career plans.
(Tip: Just like you should never pay to apply for a scholarship, you shouldn’t pay to search for scholarships. Google is free!)
Loans are provided through private companies or governmental organizations. This is borrowed money that you will need to pay back after you are no longer in school. The convenient thing about FAFSA is that federal and state loans are administered through the same application and process, so you don’t need to complete additional applications after your initial FAFSA application for the year. You apply for grants, work study, and loans all through the same application.
There are also private companies that provide loans for students, but I always recommend double checking the terms before accepting them. The interest rates are usually pretty high, and the payment terms aren’t as forgiving as federal loans. If you have to take out loans for school, I recommend going the FAFSA route and private loans as a last resort.
(Tip: There are tons of ways to pay your loans back! For individuals wanting to work in public service, you can enroll in the Public Service Loan Forgiveness program. If you are a governmental employee or work for a nonprofit, your loans can be forgiven after you make 120 qualifying payments.)
Private pay is when you are paying for your educational expenses out-of-pocket. Most students have some form of private pay when you look at all your educational expenses. This could be paying for your tuition and fees, but it could also be paying for your textbooks and school supplies. Paying for your off-campus apartment should also count as an educational expense when you are building a budget and determining your total cost to attend college.
Private pay could consist of your parents or family helping you with educational expenses. Or some students work during the summer to save money to pay for their college during the fall and spring semesters. If you need to pay for college out-of-pocket, getting a summer job is a great way to build up a nest egg while also gaining valuable work experiences. Many students also work during the school year to pay for their apartment.
Finding and applying for scholarships and financial aid can be exhausting, but it is worth it! Everyone wants the giant scholarship like the Coca Cola Scholars program, but little scholarships add up to make a big financial impact! I paid for a large chunk of my undergraduate education through multiple smaller scholarships. You should apply for as many scholarships and financial aid opportunities as you can get your hands on. These can help you decrease your college expenses, and reduce the amount you’ll have to pay out-of-pocket.
(Tip: You also will get a refund if your aid amount is greater than the amount you owe your school! Many students that live off-campus will use the refund the receive to pay for their rent for the year.)
Need help with the college process? Simpson Education Consulting can help you navigate the college process, find your dream school, and make college affordable! Reach out to our team if you need help!
Have a question you’d like answered on the blog? Send me an email at coleman@simpsoneducationconsulting.com and I’ll get back to you!
