College Funding Options

So your heart is set, you have applications in hand and now the next step is to figure out how you're going to pay for school. Well there are four traditional options: scholarships & grants, work, private loans and federal loans. All for choices have their upsides and their downsides. We'll take a look at each of them here.

Scholarships & Grants

Scholarships are undoubtedly the easiest way to pay for college. What could be better than free money from some altruistic group that likes you for who you are or what you've done or where you come from? The upsides to scholarships and grants is that they are indeed free money and usually do not have to be paid back...ever. One of the downsides to scholarships and grants is that you have to qualify for them one way or the other. Grants are usually given based on financial need (i.e. you have no money no income, and can prove it). Scholarships may also be given based on financial need but can be given out for a whole host of reasons as well including:

• Academic Merit
• Athletic Merit
• Race, Gender or Heritage
• Parentage
• Where you live
• Writing a good essay
• Even whether or not you are left-handed!

Odds are there is a scholarship or two (dozen) out there that you qualify for, all you have to do is find them and apply. One other downside to scholarships and grants is that they are usually fairly small so you may need a lot of them to pay for school, and they don't usually stay with you beyond one semester or year, (you have to reapply).

Federal Financial Aid

Heard of Fannie Mae and Freddie Mac? Those are the two big, pseudo-government housing lending institutions. They give money to people who would not otherwise be able to afford a home and help them get the home of their dreams. Well there is a similar pseudo-government body that does the same thing for college students: Sallie Mae. By filling out a detailed application available online which shows your (and your family's) financial status, you may qualify to receive loans and grants through your school to help (or completely cover) the cost of your education. This money is offered as a loan which does not have to be repaid until after you graduate or if you drop below part-time at your college. The upside to this is that it is relatively easy to do and only has to be done once per year to renew. The downside is that it is a loan and once you take it out, there is practically no escape from paying it back...even if you graduate and don't get the job of your dreams and can hardly afford it.

Private Loans

There are banks and other lending institutions out there that do the same thing that Sallie Mae does: lends money to students to help them pay for college costs and asks for no repayment until after graduation. Your interest rates may vary and these loans may be more difficult to qualify for than the Federal loans because they are based upon your credit.

Work

This is the "old school" way of going to school: Get a job! Despite the skyrocketing costs of attending higher education, there are still plenty of people who manage to do it without borrowing a dime from others. They work. Sometimes they manage to work nights and go to school days, sometimes they work days and go to school at night. In some cases, they may have to attend school for a semester or two and then stop for a semester in order to earn enough money to continue their education. Obviously this method takes much hard work and dedication and could likely extend how long it takes to graduate by a year or more, but the benefit is that you graduate debt-free and with loads of work-experience under your belt which shows a dedication and stick-to-it attitude that employers absolutely love to see on a resume.

Although it seems like money is tough, there are ways to save money while going to school Be sure to go over the different ways of saving money so your loans don't get as big as they have too.