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| Financing A College Education |
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So your teenager has decided to go to college. You've hoped for this day. You
sweated through 12 years of school with your child, and have been an active
participant in his/her education. You've been saving for this day for years, but
with all the other "incidentals" of daily life, car expenses, medical bills,
that new roof, the money you had hoped you'd have is not there. What you have is
not quite enough for that four year private college he/she is interested in
attending, and you don't want a home equity loan. What to do?
Today
there are many federal and private loans available to help parents and students
pay for college expenses. There are also billions of dollars in scholarship aid
and grants available, you just need to know where to look. Some of these monies
come directly from federal and state governments, others are from private
sources. Generally, scholarships and grants, which do not have to be repaid, and
are based on the student's ethnicity, financial need, intended major, and GPA
and SAT scores.
The first course of action would be to try to obtain a
college scholarship or grant. There is grant money available through the federal
government Pell Grant. To apply for this grant, the student must complete a
FAFSA, or Free Application for Federal Student Aid. The amount a student
receives is based on the actual school cost and the amount the family will pay.
The student could also check with his or her high school guidance counselor. The
guidance counselor will know what scholarships are available if the student will
be attending a college in the local area. Check with local community
organizations and local businesses for possible scholarship availability.
Another place to search for scholarship money is the college that you are
interested in attending. Most colleges have what are called institutional
awards. You can check the college website or catalog for these.
There
are loan programs available to the parents, or to the student, at generally low
interest rates. One federally funded loan program for parents is called PLUS
Loans. Under this low interest loan program, parents can borrow up to 100% of
college costs and the interest may be tax deductible. There is no collateral
necessary and no pre payment penalty. The Federal Stafford Loan is a low
interest loan made to the student. This is a deferred loan, meaning that loan
payments may not start until the student graduates.
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