Student loans. The term that appears to have the same effect as the “he who must not be named” in Harry Potter. If you haven’t incurred any students loans I’m sure you know a friend or even your parent that is still paying theirs off.
Between exorbitant fees and inflation, the cost of education within the U.S. has skyrocketed over the last 40 years. Leaving many to question, is college even worth it? I’m not here to answer that question for you, but depending on your field of interest it can open doors of opportunity. So how do you pay for college without loans?
First and foremost, you should apply for the FAFSA. The Pell Grant is money you do not have to pay back to the federal government.
- Over 1/3 of 2018 high school graduates didn’t complete the FAFSA. Among all high school graduates — not just those who were eligible to receive a Pell Grant — 37% (1,266,474 students) didn’t complete a FAFSA.
- $2.6 billion went unclaimed for the 2018-19 academic year. High school graduates eligible for a Pell Grant left behind $2,582,758,067 in free aid by not applying for financial aid.
- Students could have received nearly $4,000, on average. Nationally, each student left behind an average of $3,908 in Pell Grant aid that could have been used toward attending any college that processes federal student aid.
Source: Nerd Wallet
All of that money left on the table is mind blowing! Check out these other options to pay for school without taking out student loans.
- PELL Grant (FAFSA)
- Endowments
- Scholarships
- Assistantships/Fellowships
- Teacher’s Aid (TA)
- Resident’s Assistant (RA)
- Utilize community organizations
- Application fee waivers
Student loans should not be your first resort when looking toward furthering your education. Check out the Glossary tab for a clear definition of each term above. If you do have to take out a loan, I highly suggest you seek public loans (federal government) before seeking private ones (banks, credit unions, etc.)
Federal
- Loans from the government.
- Credit checks are not required for most loans.
- Fixed interest rate.
- If you cannot meet repayment you can apply for forbearance or deferment.
- Terms and conditions set by law.
Private:
- Loans from private lenders.
- Interest rates vary.
- Strict with repayment. (Can impact your wages and credit)
- Terms and conditions set by the lender.
Key takeaways:
- Apply for you FAFSA
- If you have to take out a loan try to go the public route first before seeking elsewhere.
- Read everything before you sign or submit for a loan. If you do not understand don’t hesitate to ask questions. Don’t let anyone pressure you into signing into a binding agreement.
- Get a clear understanding of the total cost of attendance of your school before committing. Big names often come with big price tags. Be intentional about your why for attending and how you’re going to finance this education during and after your college days.
Your education is an investment in your future. To be a wise investor, you must move strategically and weigh out your options before committing. As a stakeholder in your dreams please be aware and knowledgeable before signing anything. Look out for Part 2, titled, Loan Culture: The Impacts on Wealth Building.
