When it comes to the topic of paying for college, many parents/adults start to feel a sense of dread. I imagine it is the similar feeling students feel when they start to work on their college essay. An undergraduate degree is expensive. There, I said it. As total costs of attendance start to creep towards the six-figure mark, a bachelor’s degree is a massive investment in a student’s future. And, as the market is dictating, it is necessary for many jobs (not all, mind you). According to US News and World Report, the average tuition and fees for a private college is hovering just below $40,000, with Princeton University coming in at a whopping $56,000.
Now as low and middle income students navigate their way to and through college there may come a point where they feel it is financially unattainable. Like Schroedinger’s cat, it is both true and not at the same time. The reality is that few students possess the means to pay for their education outright. However, it does not actually mean your pursuit of a college degree is out of reach. This is where financial aid and scholarships come into play.
Financial Aid Defined
Studentaid.gov, the US government’s sole provider of federal financial aid funds, defines financial aid as: “money to help pay for college or career school. Grants, work-study, loans, and scholarships help make college or career school affordable.” I want you to re-read that statement and take specific note of the types of aid they list. In essence, financial aid is a combination of different types of funds (from different places) that a student can use to help pay for the costs associated with earning their degree.
3 Categories of Aid
Reading and learning about financial aid can feel confusing and complicated. I’ve been working in the admission field since 2006 and seen financial aid described in a lot of different ways. In fact, each year I learn something new. It can be challenging to fully understand what financial aid is beyond the basic definition (see above). One of the ways I was taught to conceptualize the types of aid was in three categories: Grant/Gift Aid, Loans, and Work. Keeping to these three categories makes a student’s and family’s life much more simple. Sometimes when things feel complicated, simplicity can be a remedy. So let’s take a moment to define these categories.
- Grant/Gift Aid is free money–in other words, they are the funds that do not need to be repaid. Eligibility for these kinds of funds could be based on one’s financial need, academic performance, contributions to the community, and/or extracurricular accomplishments.
- Loans are funds that have to be paid back with interest. The most common loans come from the US federal government, though private banks also offer educational loans.
- Work is any money a student earns from a part-time/full-time job.
Financial aid is a complicated subject, and this only provides a high level overview. I hope it provides you with an introduction that is helpful and useful.
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