A recent “Upshot” blog in The New York Times reported on an analysis of Labor Department statistics by the Economic Policy Institute in Washington, which demonstrated that a four-year degree has probably never been more valuable. The pay gap between college graduates and everyone else reached a record high when Americans with four-year college degrees made 98 percent more per hour on average than people without a degree. The National Association of Student Financial Aid Administrators (NASFAA) concluded that “The decision not to attend college for fear that it’s a bad deal is among the most economically irrational decisions anybody could make.”
The question still remains of how to pay for this education. That’s where financial aid comes into the picture. The first piece of the financial aid puzzle is federal student aid. This may include a combination of grants, which do not have to be repaid, and federal student loans, which do have to be repaid. If that’s not enough, here are six additional steps you can take:
1. Federal Work-Study: This program provides part-time jobs for students with financial need, allowing them to earn money to help pay education expenses. It encourages community service work and work related to the student’s course of study.
2. Other Resources from the Federal Government: Besides aid from the Department of Education, other opportunities include aid for serving in the military or for being the spouse or child of a veteran; tax benefits for education; an Education Award for community service with AmeriCorps; Educational and Training Vouchers for current and former foster care youth, and/or scholarships and loan repayment through the Department of Health and Human Services’ Indian Health Service, National Institutes of Health, and National Health Service Corps.
3. State Financial Aid: Even if you’re not eligible for federal aid, you might be eligible for state financial aid. Contact your state grant agency for more information, since each state is different.
4. College Financial Aid: Your school will have many types of grants and programs available to help pay for your education. Ask the financial aid office for assistance.
5. Scholarships: Many organizations offer scholarships or grants which can make a real difference in how affordable your education is. Check out every possible resource to find scholarship money. Look online, ask friends and relatives, consider community groups, and ask your high school guidance counselor. Also inquire whether the department that offers your course of study has any scholarships for students in your major.
6. Private Student Loans: Many banks and lenders have private student loans available to cover any remaining difference between costs of attending and available funds. Be sure to ask about interest rates, interest deferment, and repayment options before signing for any loan.
If you need more information about what to do when federal student aid is not enough, or want insights regarding the college financial aid process, contact College Financial Aid Advisors (CFAA).