A College Financial Aid Primer

Students need to call upon several sources to cover the massive expenses college drops on them. Unless they’re independently wealthy or have a large college fund set up for them, they’ll scramble to come up with the funds to pay for tuition, fees, books and living expenses.

A post at 20′s Finances runs down some means students can use to pay for school:

* Grants and scholarships. The sweetest variety of financial aid, these freebies often come to you via academic achievement, hard work in filling out applications and good old-fashioned searching. Students build the rest of their aid packages from the base of whatever grants or scholarships they receive.

* Loans. Students sink into a tapestry of debt to cover outstanding expenses. The most attractive options are subsidized loans they don’t have to pay back until after graduation, but what they’ll be offered depends on their income and resources. Filling out a FAFSA form is the first step to finding out which loans they qualify for.

* Work study. Often offered on a case-by-case basis, schools often cut tuition in exchange for labor. Work study trumps regular campus jobs because the money they pay in college fees usually far surpasses standard, low-end wages.

Different Types of Financial Aid [20's Finances]

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  1. kosmo @ The Soap Boxers says:

    “Work study trumps regular campus jobs because the money they pay in college fees usually far surpasses standard, low-end wages.”

    I’m glad that’s the case now. It definitely wasn’t the case for me in the mid 90s. Most of my work study was minimum wage, regardless of whether it was washing dishes, tutoring accounting students, or working as an IT guy (although the IT boss did bump those rates up at one point, which was nice).

    • missy070203 says:

      I participated in work study programs from 2003-2006 and they didn’t help my tuition fees at all…. i was assigned to work 15 hours per week in the Chem lab in exchange for a meager $200.00 a month after taxes…. no discount on fees what so ever… and turned out not to be the resume builder they promised….

    • swat1227 says:

      I’m a 2009 grad, and I held several work study jobs. The only ones that DID pay above minimum wage were those that were “honors” jobs–researching for a professor. Everything else was basic minimum wage–and they set a cap at how much money could go to work study each semester.

      Another suggestion–if you can hack it, don’t just do work study. I pulled down four jobs at a time in college, getting somewhere between 30 and 40 hours of work each week. Helped keep my debt down tremendously–and pay for all that pizza.

      • kosmo @ The Soap Boxers says:

        The one great thing about the on campus jobs was the location, though. I didn’t have a car for most of my college time, so being within walking distance was nice. I also had worked at a baseball card shop right next to campus for a while.

        At least all the jobs were fairly interesting. Even the food service job was interesting, as it tended to attract a pretty diverse group, including a lot of international students. We had a lot of chats about culture, religion, etc working the breakfast line (guess what – it’s not very busy at 6:30).

        One summer, I managed to work 40 hours per week while taking 12 credits (got a dual BS in 4 years, so I needed a couple of summers). That was a busy (but fun) summer. I supported the English department’s computer labs, and we were short staffed that summer. I ended up being in a class taught by boss, and it was held in one of the labs. He scheduled me to work the hours that I was in class, so I was doing double duty for those hours. I’m sure someone would have frowned on the idea of distracting a student with work during class time, but it wasn’t a difficult class for me (business communication), so I aced it anyway.

    • crispyduck13 says:

      If they mean low paying wages like the $2.15 an hour for waiting tables they might be correct about being “much higher”, but in 2002-2005 work study jobs rarely got close to or over $8/hr at Pitt. However, I did land one that was around $8, lasted about 2 months there. It was a secretary’s assistant position at the electroshock therapy office at the Western Psychiatric Institute. Yes, they still do that.

      Worst. Job. Ever.

    • Lethe says:

      I tutored computer skills to ESL students in college as a work study, and in my second year actually made more than my tuition came to (note- in Canada, I believe tuition is cheaper, but could be wrong).

  2. Maltboy wanders aimlessly through the Uncanny Valley says:

    Plan B: Incur massive student loan debt and then stage mass protests in a ridiculous and childish attempt to get the taxpayers to foot the bill for your follies.

    • Coffee says:

      How is the view from your high horse? I don’t know about you, but where I grew up, we were all told that the best way to be successful in life was to go to college, become educated, and earn a living doing something that engaged us intellectually. It was drilled into my head starting from elementary school (“don’t get in trouble or it will get on your permanent record and you’ll never get in!”) and continuing in high school (“I know it’s your freshman year, but you need to start planning on which schools you’ll be applying to three years from now”).

      When you’re seventeen years old and all the adults in your life are telling you that this is the way to do things, you believe them.

    • Tiercelet says:

      Wow, looks like somebody hasn’t been following the relative changes in higher-education prices compared to inflation and minimum-wage. Nor the steady push to move public universities into private-style pricing.

      A challenge: Go check the website of wherever you went to school* and compare the price now to the price when you went there. Post the difference here and tell us all whether or not you’re shocked.

      * if you did, of course. If you didn’t, that may well have been a good decision; if I had a kid going to college in two years’ time I’d be pushing trade schools myself.

      • maxhobbs says:

        And I had a job since the time I was TWELVE (started delivering papers, then washing boats, then food service). I myself saved thousands of dollars by the time I was 18 and then I worked 30 hours a week when I went to college.

        I paid 100% for my college as I went, no help from parents, no help from loans or the government.

        But yes, I had to live in a fleabag apartment with several others, NEVER went out, ate a lot of spaghetti and mac and cheese. But I got a REALdegree and started at day one with zero debt.

        • Coffee says:

          Depending on when you went to college, Tiercelet’s point still stands. I worked through college and went to JC before transferring to save additional money, but that was about ten years ago…prices have gone up since then, and “putting yourself through college” is no longer feasible unless you have something like a trust fund to supplement your income.

        • Nigerian prince looking for business partner says:

          I worked pretty much non-stop from the age of 11 or 12, joined the Army, and then the National Guard, and worked while in school (state school) and still wound up having to take out loans.

          Working paid enough to cover living expenses but even with scholarships, GI Bill, and National Guard EAP money, I still needed loans to help pay for additional tuition, textbooks, and health insurance. I imagine the situation is even worse now, since state schools are so much more expensive.

          I’m not sure if my school was the exception but all balances had to be paid in full prior to registration. There were several times I had to float tuition with loans, while waiting for the GI Bill or paychecks to clear.

  3. Laura Northrup says:

    There were massive cutbacks to work-study for this school year, at least where I work — students were cut to 3-4 hours per week, total, unless the department where they work have their own funding to pay student workers outside of federal work-study.

    • Coffee says:

      Laura,

      I work in administration at a college on the fiscal side, and I can tell you that work-study funding at the state level is heavily subsidized by federal funds (via the Federal Work Study program). We’ve also had to massively cut back on our work study students or fund them from grant monies or other funding sources. I guess I’m just repeating what you said, but it’s the same here.

  4. oregon_native says:

    I’m not sure I’m understanding your comment about FWS correctly. You do not get a discount if you are offered work study and accept it. Work study is paid to a student like a paycheck, for doing their job. Not all jobs on campus are work study eligible, either. Many jobs are minimum wage or slightly above (for instance, if you have $2,000 work study for the year, you can’t set up a deal with your employer to do a short-term job working a total of 100 hours and make $20 per hour to use it all up).

    Your tuition won’t be discounted, so if you still have a balance you’ll need to find a way to pay it off, because I don’t know if any school that would apply your FWS to a bill. Many students accept work study and then don’t get a work study position, and therefore that money will not ever be used. I don’t even think it’s legal for a school to “cut tuition” in exchange for labor, unless it’s a tuition remission thing because a student/their parent works for the school in question.

    I am a financial aid counselor at a university, and all universities may have different policies, but I’m hard pressed to believe that the regulations set forth by the Department of Ed would allow for a tuition discount. I looked at the source article and didn’t seem to see anything alluding to that, either.

    A few important tips for students who are or will be going to school (parents, take heed as well):

    1. Fill out a FAFSA. As early as possible (I recommend March 1 or before). Some aid funds – for instance, Perkins loans or Supplemental Educational Opportunity Grant – are very limited. While some offices may have a FAFSA submission cut-off date for these awards, others may simply award it until it’s exhausted. The earlier you complete a FAFSA, the more likely you are to be awarded these forms of aid, if you’re eligible. If your taxes won’t be done by March 1, estimate based upon last year’s tax return and then you MUST log back into the FAFSA website to make corrections after you’ve done 2011 tax returns. Note that any changes to the numbers may result in adjustments to your awards.

    2. If you’re offered subsidized and unsubidized loans, take the sub loan first. This is the less expensive of the two. Sub loans don’t accrue interest while a student is in school (unless the student drops below half time), while the unsub loan does (students aren’t required to pay the interest while in school, though they can; if they don’t, it’s added to the loan when it enters repayment).

    3. If the Department of Education selects you for verification (a process in which the office is required to confirm certain documents against the FAFSA you submitted), submit your documents as soon as possible and respond quickly to any follow-up questions the counselor may have. It’s in your best interest to get this resolved as quickly as possible, because your federal aid will not pay out until the verification process is complete.

    4. Cruise Fastweb. Many (possible most, especially at private schools) students don’t get their way paid in full by federal and institutional scholarship aid. Unless you’re planning to pay the balance out of your own or your parents funds, you may want to look into other scholarships. The added bonus is that it may lower your loan debt, if the loan gets replaced (or partially) with scholarships.

  5. FatLynn says:

    Another huge source of funding for college is employers. Many employers offer tuition reimbursement at both the undergraduate and graduate level.

  6. Thaddeus says:

    Financial aid lackey here – Just a note on the Direct Stafford Loans: Next year loans disbursed after July 1, 2012 will be at a 6.8% interest rate (subsidized and unsubsidized) and the 0.5% loan rebate is ending. All Direct loans will now have a full1% processing fee.

    The simplified needs test for a 0 on your FAFSA (the AGI cut off) is also being increased (23k to 32k) and Pell at higher EFC levels is going to be reduced.

    Simply put: File your FAFSA early, only borrow what you NEED, take electives at a community college and transfer if you’re looking at a four year, APPLY FOR SCHOLARSHIPS, and pay down whatever you can (if you can) on your loans while you’re in school.

  7. Mr Grey says:

    I did the loan route back in the late 90′s – went to a state school, and majored in a high demand field.
    I paid off the loans pretty quickly –

    I think the key was I majored in Comp Sci and got a good job – My roommates who majored in Philosophy, and Art History are now going back to get degrees in IT.

  8. Hungry Dog says:

    You can always join the military and hope they don’t thoroughly sodomize you with potential benefits laden with stipulations that will be found out weeks after you go through the legwork to apply for said benefits and when they deny everything you applied for under the “you should have known” explanation to clarify things.

    I’m not bitter, not bitter at all.