Most people understand how important college education is in today’s competitive job market. However, funding your college education is a hefty investment in this difficult economy. On average, a single year in a four-year college or university program costs $20,770.
And, if you opt for an out-of-state public college, the figure jumps to around $36,420. Having said that, you don’t have to break the bank to pay for college education. Here are 7 genuine ways to fund your college education:
#1: Apply for FAFSA
Begin by applying for the Free Application for Federal Student Aid (FAFSA). The form can help you receive financial aids like student loans, work-study grants, federal grants, and some school-based aids. Some colleges award the grant on a first-come, first-serve basis, so be sure to fill it out as early as possible.
#2: Apply for Scholarships
If you’re thinking about getting a scholarship to offset your college tuition, it’s important to apply early. Fortunately, there are useful scholarship search tools on the internet to help you narrow down your selections. Scholarship funds don’t have to be paid back, and most options require a separate application from your FAFSA.
#3: Seek Grants
You could also apply for Federal Pell Grants. The first step is to fill out the FAFSA form and renew it every year you’re in college. The grants don’t have to be paid back. Moreover, you can apply for both federal grants and state grants.
#4: Use Bonuses and Tax Refunds
Saving for college education encompasses numerous options, including tax refunds, bonuses, inheritance, and even earnings from hobbies. Before you resort to taking loans, consider any available funding option that can fill up the gap. Begin your savings plan as early as possible to ensure that you’ll have enough funds when you enroll in college.
When you earn some extra cash from bonuses or tax refunds, you can redirect them to your college savings plan instead of spending it on your recurrent budget.
Most families cover up to 34 percent of college costs through savings. As soon as you enroll in an elementary school, create a savings account and begin dipping something into the account every month. A 529 plan is a popular way to save towards college education. These accounts often provide tax advantages as long as the investment is meant for college education.
Be sure to set a realistic savings target and stick to it. It should be something you are willing to save without jeopardizing your other priorities like retirement savings. You may not raise enough money to fund 100 percent of your college education, but it will surely bridge the gap. The good news is that you can seek other funding sources like loans and grants to cover the deficit.
#6: Federal Loans
The last thing that college graduates want is to repay student loans. However, sometimes it’s a necessity. Federal loans can help you bridge the funding deficit and payback depending on your income level. It can also be forgiven under certain circumstances. As long as you’re enrolled in college, federal subsidized loans don’t accrue interest.
#7: Private Student Loans
As a last resort, you could apply for a private student loan. These loans don’t offer the same benefits as federal student loans, but they can come in handy when other funding options fail. Take your time to shop around private lenders and choose the one with minimum interest rates.
Another feature to look for is the flexibility of repayment plans. Some lenders give an option to put the loan on hold until the applicant is in a position to repay. Interests on private student loans often kick in as soon as the money is disbursed. However, the repayment will begin after graduation.
As you look for alternatives to fund your college education, it is important to set a dollar amount you can afford and work towards finding alternative ways to supplement it. Some options to consider include work-study programs, scholarships, grants, and student loans.
More importantly, you need to get started as soon as possible. Even small savings can accumulate into substantial amounts over time. Every dollar saved is an extra dollar that you won’t have to raise or borrow.
Feel free to drop a comment below or reach us through our “contact us” page if you have any questions on how you can save money for your college education.