Key takeaways
- Scholarship and grant funds, work-study and subsidized loans available may cover only a fraction of the full cost of college.
- Private loans, contests and peer-to-peer lending, among other resources, can help you cover the cost of college.
As the costs of attending college continue to skyrocket, the gap left after government financial aid has been maxed out is also growing rapidly. Even for undergraduates at state schools, the combination of scholarship and grant funds from the college, work-study and subsidized loans available through the Free Application for Federal Student Aid (FAFSA) may cover only a fraction of the full cost. Parents’ contributions or a college savings plan may cover much of the rest, but may still leave you short.
If after everything mentioned above you’re still low on funds, here are nine possible ways fill that gap:
1. PLUS loans. Parent loans for undergraduate and graduate students, known as parent Direct PLUS loans, have a fixed interest rate but unlike the Stafford and Perkins loans available to students, the interest is not subsidized while the student is in school. However, it is not subject to limits and can go up to the full cost of attendance. Students whose parents do not qualify can get access to unsubsidized student loans beyond maximums. PLUS loans do have an origination fee.
2. Private loans. These have become much more important as the limits on government loans fail to keep pace with college costs. Except for the most creditworthy borrowers, these are likely more expensive as interest rates tend to be higher on private loans than on federal loans. Advice on what to look for and reliable lenders can be found on the FinAid website, which provides a comprehensive source of financial aid information.
Note that as an NEA member, you have access to an exclusive rate reduction through the NEA Undergraduate Loan Program.
3. Local/targeted scholarships. Everyone from your local Kiwanis Club to the high school booster organization may offer scholarships that can help defray college costs. Millions of dollars of aid is also available through niche or targeted scholarships. The American Concrete Institute, for instance, offers scholarships to civil engineering students, while the Future Farmers of America have scholarships for agricultural studies. Funds are available for students with disabilities, minority students and various other groups, such as cancer survivors or those who identify as LGBT. Fastweb offers matching services to help students find scholarships according to their profiles. The Scholarship Coach at U.S. News also helps locate scholarship money.
4. Community college scholarships. More and more students are beginning their college education at a community college because of the much lower cost, with an eye to transferring to a four-year college. But even these two-year institutions are not free (at least not yet), so don’t neglect scholarship money available for them. The Phi Theta Kappa honor society offers scholarships both for the associate degree at the community college as well as going on for a bachelor’s degree in a four-year college. The Coca-Cola Community College Academic Team offers 150 scholarships a year in varying amounts.
5. Employer scholarships/tuition assistance. Employers sometimes offer scholarships to dependents of employees. Or they may offer tuition assistance or reimbursement to the employee that can be tax-free up to certain limits. College employees can often get discounts or waivers on tuition.
6. Contests. These are sweepstakes or other lottery-type awards that often only require some information about you or your (planned) school. Sallie Mae, a federal institution now specialized in private student loans, conducts a sweepstakes for scholarship money for those who sign up to use its toolbox for college planning. Niche, which rates schools and colleges, has a “no-essay” contest for those answering a questionnaire about their school or college.
7. Peer-to-Peer Lending/Crowdfunding. Social networking via the Internet has opened access to new sources of funds. For one thing, these new facilities provide a way for friends and family to contribute with the more formal apparatus of documentation and loan servicing. Investors also are interested in getting into what is now the second-largest debt market after mortgages. The initial focus for investors has been on loan consolidation once the student graduates, or funding for graduates in specific programs, such as an MBA degree. Common Bond and SoFi are two peer-to-peer lending sites with specific student loan programs. Fastweb lists some crowdfunding sites for student loans and others are described here.
8. Campus Employment. If work-study is not already part of the financial aid package, there are other opportunities for working on campus beyond the somewhat narrow criteria for the work-study jobs. Resident assistant or campus tour guide are two possibilities. On-campus work will usually offer greater flexibility for scheduling around classes and school vacations, plus alleviating the transportation issue of off-campus employment. Merit-based employment such as research assistant is also a possibility. Unlike work-study, where wages go directly to pay off tuition fees, the student has control over these earnings. Tutoring fellow students or note-taking for them and editing their papers are other possibilities.
9. Off-campus/odd jobs. Uber and Lyft are new possibilities for earning money as a driver, especially if the college is in a metropolitan area, but there are other possibilities—such as taxi or limo, delivery truck—where you don’t need your own car. Courier work can be done on a bicycle. Many college students hire out as movers, which has the advantage of often being on weekends. Less strenuous are things like babysitting, house-sitting, dog-walking or running errands, particularly for seniors. Temp agencies can find occasional employment for students.
