Alternative Funding: When Student Loans Are Not Enough

Going to college can be expensive and that leads many students to seek alternative funding. While there are student loans available from the federal government that are need based, the loans are not guaranteed to pay all education expenses. When the federal government loans are not high enough to cover all costs, alternative funding helps to cover the remaining expenses. There a few funding alternatives:

Scholarships

There are many different scholarship programs available to help students. While they may be hard to get, students who take time to complete scholarship applications and do scholarship essays are one step ahead of those who think they would never get a scholarship. Even a $500 scholarship is enough to cover a few books, and that is better than having to pay $500 back in loans. A $250 scholarship can help pay for school supplies. Small amounts add up.

Grants

Grants are harder to get a hold of than loans and scholarships, but there are a few different grant programs students can apply for. PELL grants are usually awarded with the Free Application for Federal Student Aid or FAFSA. These are small grants, but the money awarded does not have to be paid back.

Work Exchange Programs

Depending on the school, students may be able to get a job working for the school, in the library or another place on campus. The student can earn a bit of money while also earning tuition credits to cover the cost of his or her tuition the following semester. Speak to the admissions officers to find out more about the program available at the student's college of choice. Each college will have its own terms and conditions surrounding work exchange, and various jobs available may pay differently.

Private Loans

If the student, or their parents, have good credit, private lenders may extend student loans to help cover the balance. Parents who cosign for the loans are helping their children build better credit scores and providing the backing the bank needs to feel secure to lend the funds. While students may defer federal loans even after the repayment period begins, private loans cannot usually be placed in deferment or forbearance. To avoid damaging the credit score, a separate payment agreement must be made with the lender.

If it is hard to secure enough alternative funding to attend college full time, consider extending the program and going part time for a while to increase the chance of having financial aid left over to cover books and supplies. As students move through the ranks from Freshmen to Senior, they will become more likely to receive more aid, making it possible for them to change their enrollment status back to full time and finish their degree program around the same time they would have in the first place. Attending school for a longer period than was planned, is better than not going at all.


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