Paying For College
This is the question that will be popping more and more often as your children are getting close to college-going age. The good news is that there are many available alternatives to help prospective students and their parents pay for college. A private college in the US, including tuition plus room and board, is on average around $35,000, and this amount is increasing by between 4 and 7% annually.
You might have to work through the years to pay the tuition as your child attends college, if your savings aren’t enough to cover college expenses. This can be quite a burden in addition to your normal living expenses. A number of financial aid options, however, are available.
Basing on the total cost of their education and the family’s ability to pay, need-based Aid are offered to qualified students. Need-based aid may come in the form of a low-interest student or parental loans, federal or institutional grants, or a work-study program subsidized by the Federal Government.
Federal Student loans ? the Perkins and Stafford loans – give students loans with lower interest rates that are accrued only after repayments start. Private student loans are available to students as well.
Giving parents low-interest loans are the PLUS loan (Parent Loan to Undergraduate Students) but the repayments start 60 days after the loan has been disbursed.
Grants have one big advantage over loans, in that they do not need to be repaid. Usually awarded by federal and state governments, grants are also given by individual colleges. They are awarded based on financial need, and can help fund the gap between what parents can pay, and the tuition fees.
Paid by the school, but later refunded by the government, work-study programs give students hourly or salaried work. Library assistant positions, dining hall workers and other in-campus jobs can be offered or even an off-campus job with nonprofit organizations or other government agencies is also possible. Usually requiring 10 to 15 hours a week, work is scheduled around the student’s classes.
Merit-based scholarships are awarded based on academic, artistic, musical or athletic abilities, but are not available at all colleges. Providing the student with full tuition and room and board, these scholarships are highly sought after.
Working is another option for students to go through college. Summer internships and co-op programs provide students with the opportunity to supplement their income while gaining useful work experience and insight into their possible career paths.
All of these options can help parents pay for their child?s college education. With the statistics showing that college graduates earn up to 60% higher than people with no college education, your child will reap the benefits later in life, even if it means paying loans for a while.
