How to Find Money for College
Even in today’s recession, a considerable amount of financial aid for college students is available. But getting it requires effort.
Much of the $168 billion in college aid comes from federal funds. So to be eligible, students must file the Free Application for Federal Student Aid—FAFSA—which can be submitted after January 1 every year. It can be filed online or on paper.
After filing a FAFSA, students will get a letter detailing the amount of aid available to them, based on the expected family contribution. “It pays to fill out the FAFSA, even though not all financial aid is based on need or income,” said Deb Scholz, Iowa Student Loan. “Filling out the FAFSA provides eligibility for federal money.”
Financial aid falls into three categories:
✓ grants and scholarships
✓ work study
Loans must be repaid, while grants and scholarships do not. Work study allows students to earn money and get job experience. Loans come from either federal or private sources. Students who borrow usually need a co-signer, probably a parent.
Be sure to check federal loans first—Perkins, Stafford and PLUS loans. They have lower (and fixed) interest rates and are typically more favorable terms than private loans.
To compare private loans, look at the origination fees, interest rates and APR (annual percentage rate), and how loan interest is compounded. Also take note of your credit score (lower scores mean higher interest rates.)
There are a variety of ways to get help when filing:
• or call 800/394-7084