Funding a college education can be challenging. The majority of college students graduate with thousands of dollars in student loan debt. While student loans are easily available from the federal government and private lenders, they come at a high price. Student loan borrowers spend the next twenty or even thirty years repaying their student loans. During that time, most are unable to buy their own home or even save for retirement. Before taking on any loans, it’s smart to consider alternative funding for college students.
Fortunately, several alternative college funding options don’t need to be paid back. You can use as many as you can. You can also use more than one of these at the same time.
Go through these 6 alternative college funding options and make a note of how each one works. Once you understand the eligibility criteria, you can apply to those you qualify for and best suited to your needs.
1. Scholarships
Scholarships are hands down the best source of alternative funding for college students. For one thing, scholarships are free. You don’t have to return any award money that you win. It’s yours to keep without worrying about accruing interest.
Secondly, you can apply to as many scholarships as you want to. The more you apply to, the higher your chances of winning more money.
Thirdly, there are no restrictions on how much you can accept as award money. You’re only limited by the amount of effort you put into researching and applying to scholarships.
You can find several different types of scholarships funded by the federal government, state governments, universities, and private organizations. Some are merit-based, others are need-based. Some offer recurring awards, others are one-time awards.
Look for scholarships online as well as in your local newspaper, school notice board, and community bulletin boards. Don’t overlook the smaller local scholarships. Many local businesses offer scholarships to students within their community as a way of giving back. While these awards may be small, they are less competitive and easier to win. These small awards can add up and can be helpful when you’re looking for alternative college funding. The more funding you get through scholarships, the less you’ll need to borrow by way of student loans.
2. Grants
Grants are the second best source of alternative funding for college students. Like scholarships, grants also don’t have to be paid back. They work differently from scholarships though.
Grants are need-based and are only offered by federal and state governments, universities, colleges, and a few non-profit organizations. They have very specific requirements. In most cases, you’ll need to provide documentation supporting your financial need in order to get grant money. Filing the FAFSA (Free Application for Federal Student Aid) is mandatory to be eligible for federal grants.
3. Work-Study
Work-study is part of the federal student aid program. This alternative college funding option allows you to earn some money working in approved jobs while studying. Most jobs are on campus. As part of your work-study, you may be employed in the dining hall, library, campus gym, laboratory, or similar facility. You can use the income you earn to pay part of your tuition fees.
You have to file the FAFSA to participate in the work-study program. Your financial circumstances at the time of submitting the FAFSA will determine your eligibility for work-study. There are a few restrictions associated with Federal work-study. You’ll only be allowed to work a limited number of hours. There may also be a cap on the amount you can earn. Speak to your school’s financial office for more details about work-study.
Schools might have their own work-study programs as well. In some cases, working for the university can result in reduced tuition. For example, you might work part-time or full-time and receive a percentage-based discount on your tuition. These arrangements reduce how much you have to borrow in student loans, as well as allow you to earn a little extra money for living expenses.
4. Part-Time Work
If you don’t qualify for work-study or you did not enroll in the program, you could take up a part-time job instead. This alternative college funding option has a higher income-earning potential as compared to work-study. You will also have a large variety of jobs to choose from.
If you choose a part-time job, make sure that it doesn’t interfere with your academic work. That is your topmost priority. Do not work more hours that you can handle. If you don’t leave enough time for studying, not only will your grades suffer but you’ll also end up feeling stressed and overwhelmed. This can lead to several undesirable consequences.
You can also take up part-time jobs during school-breaks to earn more money for college.
5. Payment Plans
This is a facility that many schools offer to students who cannot afford to pay the full tuition cost upfront. This alternative college funding option allows you to pay the shortfall over the semester instead of upfront at the start of the semester.
A payment plan can be very useful if you can pay part of the money upfront but not the full amount. With a payment plan agreement, you can enroll in your program by paying only what you can afford. You continue making payments through the semester as you get the funds by working part-time. This is a better arrangement than having to defer a year to save up enough to cover the full cost upfront.
Make sure to understand all the terms and conditions before you agree to a payment plan. Most schools do not charge interest on deferred payments but some may. Also, all schools will almost certainly have some sort of fine or fee for late payments.
6. Employer Sponsorships
Many large corporations offer interesting alternative funding for college students by way of employer sponsorships. As part of this agreement, the company offers new employees, usually new graduates, benefits such as tuition reimbursement. In return, the employee must agree to work for the company for a specified number of years.
The exact terms and conditions vary from one company to another. The eligibility criteria also vary among companies. Most companies base eligibility on the recipient’s field of study. Working for a company that offers employer sponsorships is a great way to lower the cost of your degree.
There’s no doubt that paying for college can be overwhelming. But you do have a few alternative college funding options you can avail of to lower the cost of tuition. Consider researching these free aid options before you apply for student loans.
Need a loan to cover part of your college tuition? Use College Raptor’s free Student Loan Finder to compare lenders and interest rates side by side!
| Lender | Rates (APR) | Eligibility | |
|---|---|---|---|
 |
6.97%-15.03%* Variable
5.99%-14.00%* Fixed
|
Undergraduate and Graduate
|
VISIT CITIZENS |
 |
6.37% - 16.70% Variable
4.50% - 15.49% Fixed
|
Undergraduate and Graduate
|
VISIT SALLIE MAE |
 |
4.98% - 16.70% Variable
4.07% - 15.66% Fixed
|
Undergraduate and Graduate
|
VISIT CREDIBLE |
 |
6.07% - 11.31% Variable
4.39% - 10.39% Fixed
|
Undergraduate and Graduate
|
VISIT LENDKEY |
 |
6.22% - 16.08% Variable
4.09% - 15.66% Fixed
|
Undergraduate and Graduate
|
VISIT ASCENT |
 |
6.54% - 11.08% Variable
3.95% - 8.01% Fixed
|
Undergraduate and Graduate
|
VISIT ISL |
 |
5.62% - 18.26% Variable
4.11% - 15.90% Fixed
|
Undergraduate and Graduate
|
VISIT EARNEST |
 |
4.98% - 12.79% Variable
8.42% - 13.01% Fixed
|
Undergraduate and Graduate
|
VISIT ELFI |
