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5 Alternative Sources for College Financial Aid

By U.S. News & World Report

The average cost for a year of in-state public college tuition and fees for 2014-2015 is $22,410, according to the College Board. For students attending a private school, the cost more than doubles, with expenses averaging $46,272.

When you see those numbers, it’s not surprising the national student loan debt balance has reached $1.32 trillion.

Filling out a Free Application for Federal Student Aid is the first step most families take to help pay for higher education through government loans, but for students and parents looking for additional funds to offset college costs (and graduate with as little student loan debt as possible), efforts shouldn’t stop there.

Here are a few financial aid alternatives to explore that will help you avoid a pile of hefty loans:

1. Local Scholarships

Scholarships are a great (and free) way to be awarded for your achievements and get extra money for college, but with scholarship websites and organizations boasting a seemingly endless supply of awards, applying can easily become a daunting and discouraging task.

Plus, with a mass of students applying for the same national scholarships you are, the odds of securing those awards may be stacked against you. Instead of looking for national awards where your application will be up against hundreds — if not thousands — of students across the U.S., see what’s offered locally in your hometown.

Organized groups such as your local Kiwanis club, Elks Lodge or high school booster club may have a handful of scholarships for eligible local college-bound students. Other places to check for awards may include your city government or niche societies, like a National FFA Organization chapter, if you’re interested in a specific area of study.

2. University Scholarships

Once you’ve exhausted scholarship opportunities at a local level, check out the financial aid options your college or university may offer.

Some schools may grant students academic merit scholarships upon acceptance, but if your academic record disqualifies you or your school doesn’t have a big merit award program, you may still have other opportunities for free money.

Depending on your year in school, ethnicity or field of study, you may be eligible for a variety of funds. Again, the more niche places you apply, the better your chances.

If your school offers a scholarship and you meet the qualifications, apply. And, if you don’t apply or win the scholarship this year, you can always try again next year once you have a little more college experience under your belt.

3. Campus Employment

FAFSA-awarded work-study packages give students a specified amount of money if they work on campus once they get to school. However, not all FAFSA applicants are eligible for the Federal Work-Study Program, and not all schools participate.

If you’re not offered a traditional work-study package, don’t rule out campus employment as a way to make a little extra cash. There are many employment options on college campuses that don’t correspond with federal financial aid and can still help reduce your education costs or pay for essentials or entertainment.

You could be an on-campus resident assistant, a tutor or a campus tour guide for prospective students. Some of these positions may reduce overall costs by offering free on-campus housing or reduced-cost meal plans.

Part-time campus jobs are also more likely to work around your class and finals schedule. Another bonus: They’ll be close to your classes and activities compared to an off-campus job.

4. Peer-to-Peer Lending

Thanks to the Internet, peer-to-peer lending services for student loans are on the rise as investors look to break into the student loan market. Companies such as CommonBond and SoFi connect offer lending options, such as fixed rates and repayment deferment, similar to those provided by private banking institutions and the federal government. If you’re trying to avoid the traditional private student loan route, this could be a flexible option.

5. Crowdfunding

If “money for college” has been at the top of your birthday and holiday present wish lists for a while, consider taking your donation requests one step further. Create an online fundraising page, and share it on your social media channels to connect with good-hearted people who might be willing to donate to your cause.

Hey, if a guy can raise $55,000 to make potato salad, maybe you can raise a little bit to put toward your education.

More from U.S. News

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6 Essential Questions to Ask Before Choosing a 529 Plan

5 Alternative Sources for College Financial Aid originally appeared on usnews.com

Don’t Settle for Student Loans to Pay for Online Education

By WTOP Staff
Online college programs are becoming a more popular choice for prospective students, with one study finding that more than 6 million students enrolled in at least one online course in fall 2015. The popularity of these courses can be attributed in part to their flexibility with working adults' schedules, students' ability to progress more quickly through online programs and, oftentimes, cheaper tuition. [See 10 low-cost online bachelor's programs for out-of-state students.]Online degrees can be beneficial to many college students, but some studies have shown online learners complete their programs at lower rates than students at traditional brick-and-mortar campuses. Individuals with student loans but no degree comprise two-thirds of defaulted borrowers. Though these numbers are not encouraging, just like for traditional programs, there are ways to reduce how much you'll need to borrow for an online program to ensure you won't become one of these statistics. Don't just settle on borrowing student loans to cover the whole cost of your program and living expenses. Instead, start thinking about how to cut costs and cover your balance in different ways, such as the following. -- Grants and scholarships: Even though you are taking an online course, you can still apply and receive grants and scholarships. But your first step should be to complete the Free Application for Federal Student Aid, commonly referred to as the FAFSA, which will allow you to receive a Pell Grant if your expected family contribution is low enough. The EFC criteria and award amounts are adjusted annually, but the 2017-2018 academic year awards range from $606 to $5,920, which could significantly lower the amount you borrow annually. Your next step is to apply for scholarships. You can start by checking online scholarship search engines, such as the Salt Scholarship Search, College Board's BigFuture and Peterson's. But don't forget to take advantage of local organizations and your school's financial aid office. Both may offer scholarships that you can't find with a national scholarship search. [Review these 10 sites to kick off your scholarship search.]For instance, organizations like the Elks Club, Knights of Columbus or the Rotary Club typically offer scholarships annually to local students. Just because you're going to school online doesn't mean you're ineligible. Visit your local library for scholarship listings, and ask around town. You might be surprised how many local organizations offer scholarships. While these scholarships typically aren't large, every little bit counts. Each dollar you receive in a scholarship is a dollar you don't have to borrow and pay interest on. -- Work-study: Another option for online students may be work-study awards. Not all students enrolled in online programs are eligible, but students at some schools -- including, for example, SUNY Empire State College and Liberty University -- are. Work-study awards are not given upfront like scholarships and grants. In most cases, they are an offer to earn up to the awarded amount if you secure an eligible work-study job. While there is a misconception that all work-study jobs must be on campus, students can work for off-campus, nonprofit or public employers as long as the work is in the public's interest. You may be able to work for a for-profit employer if the job is relevant to your course of study. No matter who the outside employer is, it will need to have an established agreement with your college for you to receive work-study funds. Remember, to be eligible for federal financial aid, you must be enrolled and pursuing a degree or certificate. If you're not working toward a credential, Pell Grants and work-study won't be option, but you may still be able to take advantage of private scholarships -- just be sure to read the eligibility criteria carefully. [Explore what to know about financial aid in online programs.]-- Pay as you go: One of the great benefits to enrolling online is the flexible schedule, which can allow you to complete your college coursework around your responsibilities. But prospective students often overlook using their part- or full-time job earnings as an option for paying for college. Almost 80 percent of college students in 2015 worked at least part time while attending classes, according to the National Center for Education Statistics. By budgeting and thinking strategically about your college costs, you can likely reduce your dependence on student loans by paying a portion out of pocket. Many -- but not all -- online programs are less expensive than traditional programs and often have shorter payment periods. Six, eight or 10 weeks are common course durations. Because of the frequency of payments in an online setting, you may be well-placed to pay as you go and possibly avoid borrowing altogether. Attending college online and avoiding student loans may be challenging, but if you are willing to put in the effort, you can limit the amount you need to borrow. More from U.S. News Q&A: Understanding Student Loan Discharge Eligibility Student Loan Refinancing Isn't Right for All Borrowers
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