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Get Your Fair Share
By By David Fitzgerald
When it comes to spending for a higher education, you should leave no stone unturned. Take account of all aid sources, federal, state, college, and private.
Students who are determined to pay less for college don't just fill out their financial support form, sit back, and hope for the best. They come up with an all encompass plan to make sure they explore all the aid that may be available to them. You can bet they know that the four different financial packages there are, which include the Uncle Sam, state, college and private scholarships.
You can make sure that you don't miss out on college cash, too. Review the basics of the four major financial support sources for undergrads. Talk to friends and go onto the Internet and find profiles of other students and how they paid for college. As the stories go, a higher education may not be cheap, but if you take an active role in the government fund process, you can afford it.
The U.S. government towers over all sources of aid, providing about $95 billion in funding. When you send in your Free Application for Federal Student Aid, or FAFSA , you will find out if you qualify for these six major programs:
1) Federal Pell Grants. I you demonstrating significant need, typically from families with an overall low income. Award amounts are guaranteed, and the current maximum is $4,050.
2) Federal Supplemental Educational Opportunity Grants (SEOGs). Depending on the funds provide to the school and also from a low income family, you may receive from $100 to $4,000 a year.
3) Federal Work-Study. With an average award of $1,800, the program offers aid inform of a job. Will pay at least minimum wage for those who are in financial need.
4) Federal Perkins Loans. These low-interest loans allow undergraduates with exceptional financial need to borrow up to $4,000 a year, but the total amount borrowed during your college career cannot exceed $20,000.
5) Federal Stafford Loans. The Stafford is the government's major loan program. With a
variable interest rate these loans offer up to $2,625 for freshmen, $3,500 for sophomores, and $5,500 for juniors and seniors. Although the interest rate while you're in school is still low, it's gone up. You can borrow even more if you're considered financially independent of your parents.
There are two types of Stafford loans--subsidized and unsubsidized. Subsidized loans are awarded based on need, and you are not charged interest while you're in school. Repayment typically begins six months after you graduate, leave school, or drop below half-time status. Unsubsidized loans are available regardless of need. However, with these loans, you're responsible for the interest from the day you receive the loan until it is repaid.
6) Federal PLUS Loans. This non-need-based program lets parents borrow for each dependent child who is enrolled at least half time. PLUS provides an amount no more than the cost of tuition, room and board, etc., minus the amount of aid already received. First payments on these loans must be made 60 days after the final disbursement.
In the past, you could only take out Stafford and PLUS loans through a private lender, but now you can take out a direct loan if you're attending one of more than 1,000 schools that participate in the Federal Direct Student Loan Program. If you take out a loan under this plan, the U.S. Treasury is your lender--not a bank. Loans through private lenders are still most prevalent.
Additionally, the government's student loan interest deduction allows you or your parents to deduct up to $2,500 from your taxes during each of the first five years you repay your loans after college, depending on your income. Also, the government allows penalty-free withdrawals from Individual Retirement Accounts if the money will be used to pay for college. The military offers funding for those willing to serve as well.
So as you can see, there are many programs available. So go out there and get your fair share of funds for your college education.
Dave Fitzgerald is the author and developer of this site, and will be adding more helpful articles to this website as time goes on.
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