| Congratulations! You've decided to continue your | | | | in schools that serve low-income students. |
| education at a college or career school. Whether | | | | For complete information on how to apply for |
| you are a traditional student seeking a certificate | | | | federal financial aid, log onto the Free Application |
| or an adult looking to earn a Ph.D., one big | | | | for Federal Student Aid website at |
| question you have is, "How am I going to pay for | | | | Loans |
| college?" The problem may seem even bigger if | | | | When paying for school, option #3 is loans. A loan |
| you have a job and a family; money is tight these | | | | is a contract to borrow money and repay it over |
| days, and few people have the extra cash on | | | | time, with interest. You want a loan with a low |
| hand to pay for tuition and the other costs | | | | interest rate. Loan types range from charging |
| associated with higher education. | | | | your credit card (very high interest-not advised!) |
| There are four basic ways to pay for college: | | | | to getting a federal loan (low interest-a very good |
| 1. write a check; | | | | deal). Most federal student loans do not require |
| 2. get gifts of money from other people; | | | | you to begin repaying them until after you leave |
| 3. borrow money; | | | | college or are no longer enrolled at least half-time. |
| 4. earn money. | | | | Millions of students take out federal student loans: |
| You don't have to be a rocket scientist to see | | | | every year, more than $70 billion in federal |
| that option #2, "get gifts from other people," is a | | | | student aid is given out in the form of |
| sweet deal. Many students are able to create a | | | | low-interest loans. To learn more about federal |
| financial plan with elements of all three methods. | | | | student loans, read Federal Aid First, an online |
| The U.S. Department of Education provides | | | | brochure from the U.S. Department of Education. |
| information about college funding options; here are | | | | Go to |
| a few highlights: | | | | The next best deal is student loans from banks |
| Scholarships | | | | or financial institutions. These loans often have |
| It is possible to get gifts in the form of | | | | variable interest rates, require a credit check and |
| scholarships. A scholarship is a gift of money from | | | | may not provide the benefits of federal student |
| an organization or an individual to a deserving | | | | loans. |
| student. Examples of scholarships given to | | | | Your last resort for borrowing money is your |
| graduating high school seniors include scholarships | | | | credit card: you will pay the same high interest |
| from civic organizations such as the Rotary Club | | | | rate as if you had bought a new home |
| or the local Chamber of Commerce. Colleges also | | | | entertainment system or a fur coat. |
| award scholarships to selected students; this is an | | | | Work-Study |
| example of institutional financial aid. Colleges | | | | A good alternative to borrowing money is to earn |
| determine scholarship awards when your annual | | | | money through the Federal Work-Study (FWS) |
| financial aid package is determined, and at the end | | | | program, which provides part-time jobs for |
| of the school year when academic scholarships | | | | students with financial need. More than 3,400 |
| are awarded to outstanding students. | | | | schools participate in the Federal Work-Study |
| Scholarships are generally merit-based. This means | | | | program, and in a typical year over 800,000 |
| that the eligible student must have attained a | | | | students are given work-study jobs. |
| certain grade point average. Scholarships can be | | | | The program is administered by participating |
| awarded within defined academic areas, such as a | | | | schools. If you qualify, the school offers you a job |
| scholarship for the outstanding chemistry student | | | | on campus, one related to your studies, or in the |
| or for the top French student. There are also | | | | community. A portion of your paycheck is |
| many athletic scholarships awarded to outstanding | | | | withheld to help pay your tuition, and you get to |
| athletes. | | | | keep the remainder. |
| Scholarship awards may also be based on other | | | | Other Sources of Aid |
| criteria including financial need, ethnicity, or even | | | | Organizations that assist students to pay for their |
| the geographic location of the student's home. | | | | education include the U.S. armed forces. Reserve |
| How do you find scholarships? Ask at your high | | | | and active duty service personnel and veterans |
| school guidance office, or the college admissions | | | | may be eligible for benefits under the |
| or financial aid office. Search online; there may be | | | | Montgomery GI BILL-Active Duty (MGIB-AD), |
| some for which you are eligible. Some scholarships | | | | Montgomery GI Bill-Selected Reserve (MGIB-SR) |
| require that you apply, while others are awarded | | | | or the Reserve Educational Assistance Program |
| by a decision of a committee and no applications | | | | (REAP). Other organizations include AmeriCorps |
| are required or accepted. | | | | community service organization. Check with |
| Grants | | | | federal, state, and local agencies for more |
| Like scholarships, grants are also gifts that do not | | | | information. |
| require repayment. They are usually based only | | | | Tips for Finding and Saving Moneyo See if you |
| on financial need. Grants typically are awarded by | | | | are eligible for an athletic scholarship, if you have |
| federal and state governments and individual | | | | excelled at high school varsity athletics.o Consider |
| colleges. | | | | a state school in your state. Most state colleges |
| Available federal grants include:o The Federal | | | | and universities offer lower tuition to in-state |
| Supplemental Educational Opportunity Grant | | | | residents.o Go to a lower-cost community college |
| (FSEOG) is awarded to undergraduate students | | | | for one or two years, and then transfer to a |
| with exceptional financial need.o Pell Grants, which | | | | four-year school.o Live at home while attending a |
| are awarded to undergraduate students.o The | | | | local college. You could save thousands of dollars.o |
| Academic Competitiveness Grant (ACG) is | | | | Check out online programs. You could save big |
| awarded to qualified college freshmen and | | | | money and earn your degree on your own |
| sophomores who are eligible for Pell Grants and | | | | schedule--even while you continue to hold down |
| who took college-level classes in high school.o The | | | | your present job or keep up with family |
| National Science and Mathematics Access to | | | | responsibilities. |
| Retain Talent Grant (National SMART Grant) is | | | | The very first places you should look for |
| awarded to outstanding college juniors and seniors | | | | education finance programs are at the schools |
| who are eligible for Pell Grants and are majoring in | | | | you are interested in attending. Log onto a |
| engineering, mathematics, technology, a foreign | | | | reputable college directory website. Select the |
| language critical to national security, life or | | | | colleges or career schools that interest you. |
| computer sciences.o The Teacher Education | | | | Check out their financial aid pages and compare |
| Assistance for College and Higher Education Grant | | | | the programs offered--you'll be sure to find the |
| (TEACH Grant) is for students who plan to teach | | | | plan that works for you! |