Funding for College at a Glance
Share This Story
One thing is certain: College is expensive. If youre currently helping your child pay for college or you will be in a few years, heres some information that may help.
Search for Scholarships
Students can help pay college expenses by seeking out scholarships and other awards. Scholarships arent just for straight-A students and star athletes. Students may find scholarships that are just right for their particular strengths and interests. While many scholarships are for relatively low amounts, theres no limit to how many scholarships a student may receive. Added together, a few scholarships may make a big difference. High school guidance counselors can provide useful information on scholarships. The Internet is another good information source for researching scholarships:
Parents can set money aside for college in a regular savings or investment account as well as in a tax-advantaged education savings account.
One type of tax-advantaged education savings account is the Coverdell Education Savings Account (ESA) which may be used for certain elementary and secondary school expenses as well as for higher education costs. Unused assets may be transferred to other family members. Annual income and contribution limits apply.
Get a Grant
Federal and state grants may be a source of free money for students. Usually, these grants are awarded based on need like the Pell Grant, the Federal Supplemental Educational Opportunity Grant (FSEOG). Colleges often receive a fixed amount of federal grant money each year. So, the earlier a student applies for aid, the better the chance of receiving a grant. Some colleges also offer their own grants to attract desirable students or supplement federal and state aid.
Transfer from a Community College
In many cases, students can transfer credits earned at a two-year community college to a four-year school. Tuition at a community college may be substantially less. Many families save significantly by having a child start at a community college and then transfer to a four-year school.
Take Advantage of Tax Credits
Tax credits are available once a child starts college. A Hope Scholarship Credit may be available for the first two years of post-secondary education. A Lifetime Learning Credit is available for each additional year of post-secondary education or job training. The credits are available for a percentage of qualified tuition and related expenses. Eligibility is phased out above certain income levels.
Limit Financial Aid Loans
Even after savings, scholarships, and tax credits, many families still have to borrow to pay college costs. Loans are a large component of many financial aid packages.
If you do need to borrow money for college or graduate school a Federal Stafford loan is a great option since they are guaranteed by the full faith of the US Government hence, they are offered at a lower interest rate than a borrower could typically get through a private loan. Parents can also borrow money to help pay for education through the PLUS Loan . The yearly limit on a PLUS Loan is equal to your cost of attendance minus any other financial aid you receive.
Learn From Others
One of the best things you can do is Not authorized to view the specified message 2603 . The power of your community and peers can often provide guide you to the best answers.