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7 Best Practices To Pay For College During Tough Times
College is not cheap, and enrolling in classes during tough economic times can be very challenging. However, there are ways to pay for college courses when your budget is already tight with regular living expenses.
529 Savings Plan
A 529 savings program lets anyone contribute money to save for education expenses like tuition, books, and fees. Anyone can open a 529 account, and the deposits are not taxed until the money is withdrawn for educational purposes. Even then, certain types of education costs might not be subject to federal tax.
Students seeking financial aid should complete and submit a Free Application for Federal Student Aid, or FAFSA application, early in the year that the student plans to start college. Based on family income of about $50,000 per year or less, students who are eligible may receive financial aid in the form of grants, loans, and work-study on campus. Only loans need to be repaid, and many are available with terms that accommodate students’ repayment schedules following graduation. After submitting the application, students will be notified of the types of financial aid for which they qualify for the coming academic year, which typically begins in the fall.
A work-study program is a financial aid option with certain jobs provided through FAFSA eligibility. These jobs require students to work a certain number of hours per week to earn tuition fees for the courses they take. Some campus departments offer students part-time employment separate from FAFSA eligibility. One of the benefits of this type of financial assistance is the opportunity to gain work experience in the student’s major field or in a related field that can be included on the resume when applying for career jobs after graduation.
Grants and Scholarships
The FAFSA screens students’ financial credentials and approves those that are authorized to be awarded various grants and scholarships. The PELL grant, for example, is typically offered to students with very low household income, but other grants may be available as well. Community organizations often provide financial grants or scholarships to members’ teenagers who are starting college and who meet the grant criteria. Some grants or scholarships only require a demonstrable financial need or a single-parent status, for example. Other scholarships are based on a high grade point average (GPA) from high school or distinction in a particular area of study, such as winning a state Science Fair competition.
Many large companies are willing to pay partial or full tuition for employees who attend college, especially if they take classes that will enhance the employee’s value to the company. General studies classes, which usually comprise the first year or two of college study, can often be paid for in this way as well.
Of their own volition, some college students start saving their earnings from a part-time job while in high school and continue doing so while in college. When compounded by interest or matching grants, these earnings can help to offset a sizable portion of the student’s tuition and fees. Many students work part-time to help cover their college expenses.
The FAFSA will also let students know if they are approved for student loans. Some of these carry low interest rates and do not have to be repaid until graduation. The terms are generally favorable to students, and they may be government loans or privately-funded.
More funding options exist, but these are among the most popular and successful ways of paying for college. Start planning as early as possible to have your finances in order when applying to college.
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