How To Pay For College Without Worrying About Loans

Tips On Paying For College Without Devastating Loans

Figuring out how to pay for college is not as much fun as going to college itself. It takes a lot of hard work to get admission into college but once you are there, it is rewarding and enjoyable.

However, the fun part may end since you might end up being too stressed to enjoy life while trying to come up with finances to pay for your college. The problem is much worse for families in middle and upper-middle income brackets, whose struggle to get financial aid is mostly unsuccessful. For the 98.2% of students not getting perfect SAT scores, finding outside funding for college is a must.

Financial aid breaks down into two broad categories:

Grants and Loans

Grants

Grants are often awarded based on two criteria’s. That is, merit based or need based. You do not have to pay back this money to anybody.

Examples of grants include private scholarships, state and federal grants, and academic scholarships.

Loans

This type of money is payable. You borrow money on the assumption that your education will increase your lifetime earnings to a degree. Hence, that will render the loan an investment rather than a cost. Most people opt and accept loans as a way of paying for college because they are easier to obtain. Most families do not think about paying for college until it is too late to really save, or carry out a scholarship hunt. Thinking about loans in this "survival/make-it-happen” way is what often leads families into accepting predatory student loan packages.

Private student loans are predatory

The banks charge high interests since most students are poor and broke. Obviously, this is adding an extra cost burden. Banks do this because loans are high-risk investments and they want to start recovering that risk as quickly as possible.

Your bottom line is getting a degree and their bottom line is protecting assets and serving shareholders.

Government loans are better because they are premised on your bottom line: help the student pay for school. This means that government loans like the Stafford and Plus loans are low interest and often subsidized.

The downside to government loans is that they do have caps on them, so you are limited in how much you can borrow.

Anyway, this does not mean that you still have to take private loans. You can plan and make earning money for school part of your economic and academic plan.

Tips to strategize an effective college savings plan

1. Sign up for multiple scholarship websites and regularly apply.

Use a calendar to set up a comprehensive scholarship application regimen where you can apply for scholarships constantly. Set up profiles on multiple sites so as not to miss a single opportunity. Adopt a strategy where you apply for big scholarships, middle scholarships and little scholarships. You may not win them all, but most of the time consistency produces the best results.

2. Start saving

Students can also save for college. Parents should not be the only ones doing it.as much as your parents are going to be kicking in money for tuition, you can also save for a room, board, a car, etc. You can get a part time job, or even start your own little side business to enable you to save up college money.

3. Set a personal budget.

You should have knowledge of what you are currently spending to be able to save. You must have a budget in order to be able to cover your expenses during and after college.it is essential to set up a budget and adhere to it.

4. Set a school budget.

This is a budget of estimated costs so you can set savings targets and prioritize what kind of scholarships you need to be applying for. If you have more you need to pay for, you should focus on larger scholarships, the logic is simple.

5. Get a job.

Getting a job will not only help you build experience and a resume, but also earn cash. Think about it. You live rent-free and have most, if not all, living expenses paid for. This is a huge saving advantage you want to use as you prepare for college.

6. Apply for state and federal aid.

Take advantage of everything your state and the federal government offers.

7. Find a scholarship worthy activity.

If you do not have a major extracurricular activity, find one. If you have one, look for organizations connected to the activity that offer scholarships and see if your school has any related awards.

8. Realistically cut college costs.

You can look for way to help you add up on your savings. some of them may include having two roommates instead of one; purchasing a smaller meal plan and buying some of your own food; using a refurbished computer, not having a car on campus and purchasing textbooks on Amazon as often as possible.

There are dozens of ways of cutting costs that can reduce your cost of attendance without negatively affecting your financial aid. Start brainstorming and executing, but do keep it realistic. Do not go on starvation rations or try to couch surf through college.