Students finding it difficult to pay for college may be eligible to participate in the federal work-study program at their school. Formerly known as the College Work-Study Program, the FWS provides funds for part-time employment, enabling needy students to earn income to pay for their postsecondary education. FWS can effectively reduce your college costs.

Participating Schools

According to the U.S. Department of Education, more than 3,400 schools participate in FWS, paying students wages equal to at least that of the federal minimum wage. As of this writing, that minimum is currently set at $7.25 per hour. Your school, however, can pay you above minimum wage if they choose to do so.

To be eligible for federal work-study, students must file a Free Application for Student Aid or FAFSA as part of the application process involving FWS. Likely, if you’re a student in need, you already filled out the FAFSA when you enrolled in your school. In the event that you did not, you’ll need to do so. Your tuition could be reduced too.

Employment Opportunities

Under FWS, students may be employed directly by the school; by a federal, state, or local public agency; work for a private nonprofit organization; or find employment with a private for-profit organization. Speak with your college advisor to determine eligibility.

Participating institutions must use at least 7 percent of their Work to help students who are employed in community service jobs. These include: reading tutors for preschool age or elementary school children; mathematics tutors for students enrolled in elementary school through ninth grade; literacy tutors in a family literacy project performing family literacy activities; or emergency preparedness and response.

School Participation

Participating schools are required to apply each year for FWS funding. If your school doesn’t reapply annually, then its program will come to an end. Schools enrolled in FWS generally pay half of students’ wages with the federal government picking up the other half. However, if you’re a math or reading tutor, then the government may pay up to 100 percent of that amount. As a student you won’t necessarily know the source of your funding, but such tutoring opportunities underscore government policy for encouraging such work.

Is federal work-study right for you? It can be. Especially, if you want to limit your student loan liability and leave college with a minimum amount of debt on hand. Plus, you can gain some work experience, a resume building opportunity that can prove invaluable as you seek to launch your career.

It is time. Your first student loan payment is due. However, you’re faced with a bit of a dilemma: your funds are limited because your job prospects haven’t turned out the way that you expected it would. At least not yet.

Welcome to the world of life after college. It may not be the picture of what you had expected more than four years ago: a good job, perhaps your own place, maybe even a new car. Instead, you’re out of work or underemployed, you’re living at home with your parents and younger siblings, and that 8-year-old car you got while in high school is now 14-years-old and being held together by some duct tape and your prayers.

Life doesn’t always make sense nor is it fair. You’ve done your part, but you now find yourself at a crossroads: you certainly have the will to work, but jobs — good paying ones at that — are hard to find. With your first student loan repayment just weeks away and not enough money to handle payments, you’re searching for options to help you cope. Fortunately, options are available, with varying levels of consequences you must consider.

Seek a Forbearance — If you cannot make payment on your student loan, your lender may grant you forbearance for up to a year. Your student loan contract will spell out conditions of forbearance which generally include unforseen personal problems, poor health or financial problems. Get in touch with your lender, explain your problem and if granted forbearance you’ll need to fill out the proper forms. Forbearance doesn’t stop interest from accumulating, however.

Loan Cancellation — Some student loans can be canceled, but only under extreme conditions. For example, if your parents took out a PLUS loan for you and you died, then the loan can be canceled. If you were recently permanently disabled, payments can be defered and eventually discharged according to the federal student aid website. Some loans can be canceled if your school closed or if the loan was falsely certified by your school. Check the closed school search page to see if your now defunct school is listed.

Teaching Options — New teachers who take jobs serving in low-income or in a subject-matter shortage area may be able to cancel their debt. A Perkins loan can be canceled and a Stafford loan can be forgiven. At minimum, that Stafford loan might be deferrable for up to three years, giving you some time to get your financial house in order.

Personal Bankruptcy — Rarely are any student loans discharged if you file personal bankruptcy. You’ll likely need an attorney to present your case and you’ll have to seek separate court action to have your case heard according to Nolo. Bankruptcy will wreck your credit too.

Family Help — You’re back home with your parents and would prefer to live elsewhere. However, your parents, who have so much vested in you, should be told about your difficulty making payments if they don’t know that already. Mom and Dad may cover your payments for the first few months or a full year, giving you enough time to get on your feet and make future payments. Heck, you can always repay your parents when your financial situation has stabilized, so swallow your pride and ask for their assistance. Be grateful for whatever assistance is offered.

Lastly, you may want to consider certain student loan consolidation options that may be available to you. Consolidation doesn’t solve your problems, but it could buy you some more time and help you refinance your student debt to more favorable terms.

All of the brouhaha surrounding commercial banks, government bail outs and high consumer fees has plenty of people up in arms. The Occupy Wall Street movement has latched on to that discontent, supporting various “bank transfer days” where consumers are urged to move their funds to credit unions. The most recent bank transfer day was held on November 5 and was backed by the credit unions.

Credit unions have been an option for millions of consumers for more than a century, and are not-for-profit financial institutions owned by its members. By federal law, membership is not open to the general public. Rather, people join credit unions through their employer, through their church or social organization, and in some cases through their community. Still, more than 90 million Americans belong to credit unions, a number that is rising steadily. Like banks, credit unions are federally insured, offering the same level of financial security consumers desire.

Economic Democracy

For college students, the appeal of a credit union may be a strong one, in that these institutions are an “economic democracy,” giving each member equal membership and one vote, regardless of the money a member has invested. Each institution is governed by a voluntary board, comprised of directors who are elected by its members. Credit unions also pay taxes and its members enjoy lower loan rates, higher interest on deposits and lower fees than banks which must pay dividends to its shareholders.

If you are college student and are in need of a bank, should you consider a credit union? Perhaps. A credit union becomes a valid option for students attending colleges and universities that have set up a credit union to benefit students and faculty. For example, the Princeton Federal Credit Union serves the Princeton University community, by offering free checking accounts with no minimum balance required and provides free checks according to Forbes.

ATM Access

Of course, a big concern for students is access to automatic teller machines – ATMs – as these machines are a popular way for consumers to handle transactions. Fortunately, credit unions typically belong to national or shared networks of ATMs whereby members can withdraw cash without a fee.

Forbes reports that the Co-Op Network, with more than 28,000 ATMs across the country, allows members to withdraw cash and make deposits without a fee. Keep in mind that if you do go out of network, you’ll have to absorb those fees.

Credit Rating

Credit unions can also help students build their credit rating. Some are lenient when it comes to making late credit card payments, giving students up to seven days grace before a late payment affects their credit. Moreover, ongoing membership in a credit union and can help students build up their credit, enabling qualified grads to get a car loan or a mortgage at a rate lower than a commercial bank. Some students maintain both a campus credit union account and an account with a commercial bank, the latter making it easier for parents to transfer funds as needed.

You may also be able to secure a much-needed student loan through your credit union. This option is appealing to students whose bank no longer has a student loan program. However, these loans are private which means you’ll pay higher interest rates than those subsidized by the federal government reports SmartMoney. You can also expect to have your credit score checked, therefore if you have a history of bad credit, a credit union just like a bank, will assess your creditworthiness before making a decision on your loan application.

Resources

Credit Union National Association: What is the Credit Union Difference?

Forbes: When A Credit Union Beats A Bank; Esther Yi; August 26, 2009

SmartMoney: Should You Tap Credit Unions for College Loans?; Annamaria Andriotis; January 13, 2010

We’ve shared extensively news about the LIFE Lessons Scholarship Program, a special effort by the LIFE Foundation to help college bound students who lost a parent and, as a result of not having enough life insurance, have left these children without the resources to pay for college. To help choose a recipient of its $5,000 college scholarship, LIFE Foundation is conducting online voting to choose a winner. This year, a pair of runner-ups will also benefit, each receiving $2,500 college scholarships.

Three Finalists

Each of the three student finalists created videos that describe the impact of losing their parents at an early age, as well as describing what they are doing to provide for themselves and their families. LIFE Foundation is encouraging the general public to view the videos and cast their votes by visiting www.lifehappens.org/vote. The deadline to vote is July 5, 2011, at 4 p.m. ET.

“The stories of these young people are a powerful reminder that you can’t take for granted that tomorrow will come, and that it’s important to consider how your family would manage financially in your absence,” said Marvin H. Feldman, CLU, ChFC, RFC, president and CEO of the LIFE Foundation. “The students featured in our online vote are working much harder than their parents would have wanted to be able to pay for their college educations, and that’s something that could have been prevented had their parents had an adequate amount of life insurance. We’re proud to provide these very deserving students with scholarship support, hopefully getting them one step closer to achieving their college and career goals.”

Their Stories

The stories these teens have to tell are moving, but they aren’t hopeless. Each of the three, Joshua Gleim, Altoona, Pa.;  Skyler Bairds, Draper, Utah; and Mahogany Fleming, Cincinnati, Ohio have had to overcome tough circumstances, but each one has managed to get this far and they are looking forward to completing their college education.

Here are their stories:

• Joshua’s stepfather was his family’s sole breadwinner. When he died, the only life insurance he had was a policy purchased through his business to keep it going in the event of his premature death. His family was left with almost nothing, not even the means to pay for his funeral. Joshua immediately started working to help support his family. During his high school years, he worked full-time in addition to studying and pursuing extracurricular activities. Today, he attends Penn State University and works in a fast-food restaurant to help put himself through school.

• When Skyler’s father died, he left behind his wife and three children, but no life insurance to cushion the financial blow to his family. His business died when he did, further exacerbating the family’s financial struggles. Skyler isn’t letting this get in the way of his college aspirations, even though he knows that paying for his education will be difficult. He plans to attend the University of Utah this fall. He’s also committed to publicly sharing his father’s story to inspire other families to plan more wisely.

• Mahogany was just one year old when her father was shot and killed, leaving her mother to raise Mahogany on her own. Without the financial support of a life insurance policy, her mother was forced to work three jobs at times, and still struggled to make ends meet. Despite the financial hardships her family has faced, Mahogany is determined to obtain a college degree in musical theater and business. She’s currently attending a career high school where she will receive her cosmetology license so that, after graduating, she can bring in a steady income to help cover the costs of her college education at the University of Toledo.

We’ll post the results here once the online voting has ended and when the LIFE Foundation shares those results. So, go online right now and help make a difference in the lives of three people who need a show of support from you.

When parents divorce, children lose out in a number of ways. That loss is evident in the financial pressures families face even if one or both parents remarry. A recent study conducted by Rice University shows that children of divorced parents may miss out on some college financial aid, even if their parents remarry.

Parents who stay married are able to meet 77 percent of their children’s tuition costs and contribute an additional 8 percent of their income to meet their college expenses according to the study. The Rice University study was led by Ruth N. Lopez Turley, an associate professor of sociology at this Houston school.

Diverted Funds

Divorce forces many parents to divert funds for their children’s education to cover other expenses including the need to maintain two separate households. Following a divorce, parents meet 42 percent of their children’s tuition costs and contribute about 6 percent of their income. The study surveyed 2,400 undergraduate students and was published in SAGE Publications’ June 2011 issue of its “Journal of Family Issues.”

Should parents remarry, children only fare moderately better than those who remain divorced. The study reveals that remarried parents meet 53 percent of their children’s tuition costs, but contribute just 5 percent of their income. The study found that the numbers remained low even as the income levels of the remarried parents rose, matching incomes of the earlier marriage.

Blended Families

Remarried parents often must deal with issues not apparent in other situations including blended families and sometimes children who are the product of a new marriage. Diluted funds mean that children of divorced parents will have to settle for less. The researchers concluded that such students are then forced to explore financial options, sometimes at the expense of furthering their own education.

Another problem children of divorced parents face is obtaining financial aid. The FAFSA document is the most significant way students can qualify for help, but researchers have determined that children who are in families where their parents stay married receive the best aid packages.

Resource

Journal of Family Issues; Contributions to College Costs by Married, Divorced, and Remarried Parents; June 2011

While student loans have its place, there are five ways to reduce your college costs significantly, thereby reducing your reliance on borrowed funds:

1. Fill out a FAFSA – Known as the Free Application for Student Aid, a FAFSA form should be filled out by everyone regardless of financial standing. Beginning on January 1 for the upcoming academic year, the form can be filled out and electronically submitted, enabling the student to be considered for various federal and state student aid programs. Visit fafsa.ed.gov for more information.

2. Apply for scholarships — You can reduce your college costs by applying for college scholarships which can range from one time gifts of about $500 or more to full freight scholarships covering all four years of your education. Billions of dollars of scholarship money is awarded annually, but you can only get these funds if you apply. Check out our scholarship page for more information.

3. Get a campus job — Typically available to upperclassmen, on campus jobs are useful in helping college students defray some of the costs of their education. Bursar clerks, I.T. assistants and food service workers are among the positions available. Certainly, the pay is low, but the monies can be used to offset college living expenses and cover incidentals. Contact your college’s employment office for guidance on securing a position.

4. Use family benefits — Your mother or father may have valuable work benefits available to you in the form of tuition assistance. Employers will sometimes extend education benefits to offspring. This may come in the form of a college scholarship available only to children and grandchildren of employees, quite possibly making it easier for you to obtain assistance than by applying for a college scholarship elsewhere. Ask your parents to review their benefits package to determine requirements and eligibility.

5. Sell yourself — Ultimately, you may be able to offset some of your college expenses after the fact by joining the military, agreeing to teach in a low income school district or volunteering for an organization that will pay off some of your student loans in exchange for your several years of service. Of course, only choose a program that you believe in, otherwise you’ll be miserable for your entire service tenure! Inquire with your favorite group to learn more about its program on benefits.

Other ways to save include starting your education at a community or technical college and switching to a four-year school for your final two years of college. You may be able to handle a work-study program or an internship, both of which can provide funding for you and much needed work experience to include on your resume.

There are plenty of lenders out there who are more than happy to lend you the money. Incentives and ad displays promising you all the money you need without having to pay anything until after graduation is one way that lenders lure borrowers. This sounds enticing, but are you certain that you understand the long-term costs with that decision? Let’s run through an example:

Let’s say that you borrow $12,000 for the school academic year. You use the money to pay college expenses not covered by your financial aid package, such as tuition, housing, food and supplies, books and other related expenses. Likewise, you choose to defer repayments until 180 days after you graduate from college.

Note that the interest rate on private student loans is variable, meaning it can go up or down each month while you are in school and when you are in repayment. For our illustration, we are going to keep the  interest rate constant at 7% for the next 48 months (the 4 years that you are in school):

• Loan amount borrowed: $12,000
• Annual interest rate: 7.0%
• Deferment period: 54 months (includes 180 days after graduation)
• By the time you graduate (with an 180 day deferment), the total amount of your loan will be approximately $15,780 which includes the original loan amount and the interest charges accumulated during the deferment period.

Now, let’s continue with the example that you borrow the same amount to pay tuition, housing, books, etc., again in your 2nd, 3rd, and 4th years in school:

• Sophomore Year: $12,000 borrowed
• Junior Year: $12,000 borrowed
• Senior Year: $12,000 borrowed

You have now graduated from college. You will have 180 days after graduation before you make the first payment. The repayment terms will be as follows assuming that the interest rate was constant:

• Loan Amount: $58,080 (this is the approximate amount of money borrowed over the academic years that includes the amount of interest charges during your deferment period).
• Interest Rate: 7% (this is a variable rate that can change monthly. For this purpose, we will keep the interest rate constant). Term: 240 months (you will have 20 years to repay the loan).
• Monthly Payment: approximately $450.29

That is a big monthly amount to make each month. But it may be okay considering the type of job you are able to get with your college degree, which can pay a lot more money per year than jobs not requiring a degree. Consider student lending as an investment into a great career. However, you need to understand the cost-benefits analysis using private student loans to finance your college.

Now let’s consider the costs if you were to borrow the full amount to pay the total cost of education. If the cost of education was $30,000 and you borrowed that full amount each year with deferred payments, your repayment structure would look like this:

• Total amount borrowed including interest rate charges during deferment: $145,200
• Your monthly repayment during 240 months with interest rate being constant: $1,125.73

If your cost of education was $40,000 and you borrowed the full amount each year with deferred payments your repayment structure would like this:

• Total amount borrowed including interest rate charges during deferment: $193,600
• Monthly repayments for 240 months with interest rate being constant: $1,500.98

So be careful on the total amount that you will borrow. Only borrow the amount you need to cover the cost of education minus other college financial aid that you may receive. Also use our budgeting worksheet to plan your education costs. It can be a useful tool to help you keep higher education costs down.

Click for information about the SayStudent Private Student Loan

“Free Money for College Expenses,” is an attention grabber, but it is also a true statement: there are several ways for you to get hundreds, perhaps thousands of dollars to pay for higher education. Unlike a loan, this money isn’t paid back which means you can fund your education by using other people’s money.

Grant money is available through at least four sources, each of which we’ll examine here:

Institutional grants — Your college may be willing to help you cover your higher education cost. If you’re exceptional student or your bring a certain diversity to campus, then the college may be willing to slash its sticker price to lure you in. Typically, you won’t be offered such assistance until you have been accepted, therefore you’ll want to find out from the school itself if you would qualify for this type of grant.[1]

State grants — State budgets have been severely strained in recent years which means that the amount of grant money available to students has diminished considerably. Still, there are opportunities out there although some come with strings attached. For example, if you’re pursuing your teaching degree, you may be able to get a significant discount if you agree to teach in a poorer school district once you graduate. You’ll be required to put in a few years of paid work, to get the discounted rate.

Pell grants — The most well recognized grant program are federal Pell grants. Based strictly on need, these grants pay out from several hundred dollars to a maximum of $5,550 through June 30, 2011.[2] Amounts vary based on your personal needs, your educational costs, whether you attend school full- or part-time and whether you plan on attending school for the full academic year or shorter. Apply through your college’s financial aid office.

FSEOG – Federal Supplemental Education Opportunity Grants are for the neediest of students and work much in the same way as Pell grants. Grant money ranges from $100 to $4,000, funds which are dispensed through your college’s financial aid office.

Other opportunities for free money can come from family members and friends. If someone you know has an interest in you, they can contribute up to $13,000 in one year without incurring a tax.[3] That’s something to consider if you have a grandparent who wants to defray the cost of you going to school.

References

[1] Online Education Database: Hacking Financial Aid: 33 Ways to Get Money for College

[2] U.S. Department of Education: Federal Pell Grant Program

[3] Smart Money: When to File Gift Tax Forms

Before we move forward to look at grant money for college, be forewarned: there are too many scams out there to count. That is why we won’t name specific grant programs except for one at the federal level. If in doubt about any program, then don’t apply. And, most certainly do not give out private information about yourself to just anyone, details which can be used as part of an identity theft scam.

Federal Pell Grant — We’ve mentioned this grant money opportunity before and the federal Pell Grant program is worth exploring especially if you are a low income student. Payouts amounts change each year, but the government gives several hundred to several thousand dollars to cover college costs. (see Pell Grants: Your Money Source?)

State Grants — Statehouse coffers have been drained dry in recent years, therefore your state may not have funds available at the moment. Your state’s higher education commission or student aid department can tell you if funds are currently available and how to apply. Some programs also offer tuition forgiveness, provided you work for the state or a local school district after you graduate.

Institutional Grants — Colleges and universities will often tap its own funds to help defray college costs for some students. This can happen if you’re the type of student they want on campus. Instead of applying for schools who have the kinds of students they want, find schools that are eager to have you as one of their students advises Liz Pulliam Weston writing for MSN Money.

Corporate Grants — Corporations, foundations and other organizations are actively involved in providing college scholarships. Under this arrangement, extensive information is supplied to determine eligibility. Some companies offers grants, particularly to children of its employees. Ask your parents if their companies provide a fringe benefit of tuition reimbursement for children. Technically, this isn’t a grant, but if it pays for a portion of your education, consider it free money just the same.

Following Up

Follow up with the grant provider if you have been awarded free money. You may need to supply your Social Security number, a college acceptance letter or other forms identification or proof of eligibility before the funds are awarded. Oh, yes, those funds are usually sent directly to the school.

Education Advantage – Open to people diagnosed with hemophilia A, this Baxter Healthcare Corporation opportunity is for students working toward their bachelor’s degree. Education Advantage will award a $15,000 per year college scholarship to one student and several $1,000 merit scholarships to more students. The application deadline is April 1, 2011.

Disabled War Veterans Scholarship – Co-sponsored by AFCEA Educational Foundation and Microsoft Corporation employees, this college scholarship is open to active-duty service personnel, honorably discharged U.S. military veterans, reservists, and National Guard personnel who are disabled because of wounds received during active-duty combat service in Afghanistan or Iraqi. The application deadline is April 1, 2011.

Healthy Lifestyles Scholarship – Established in 2008 to honor the memory of Joan Whitworthe, an occupational therapist, this opportunity is open to students who are high school seniors or first-year college students and under the age of 25. No formal application is required, however answering a pair of essay questions and submitting your completed work to “Stay Fit” by April 30, 2011 will put you in the running for this $5,000 college scholarship.

Women in Technology Scholarship (WITS) Program – Offering multiple college scholarship opportunities for up to $2,500, WITS is for young women whose careeer path is in information technology or a related field. Your GPA, extracurricular activities and community involvement are among the determining factors weighed by the committee when considering your application and essay. The application deadline is April 1, 2011.

AICPA/Accountemps Student Scholarship – If you are majoring in accounting, finance, or information systems then this American Institute of Certified Public Accountants & Accountemps opportunity may be right for you. Up to five students will be selected and awarded a $2,500 college scholarship. The application deadline is April 1, 2011.

Women In Transition Scholarship – The Educational Foundation for Women in Accounting is behind an opportunity for women who are the family’s main breadwinner and are seeking to better themselves by returning to college to pursue a degree in Accounting. This scholarship will enable the recipient to receive up to $16,000 spread over four consecutive years based on the successful completion of course work. This year’s recipient will be announced by the end of June, but you must get your application in by April 30, 2011.

Ulman Cancer Fund for Young Adult’s 2011-2012 College Scholarship Program – If you or a loved one was diagnosed with cancer when you were at least 15 years old, then the Ulman Cancer Fund college scholarship opportunity is for your consideration. The application deadline is April 1, 2011. Recipients will be awarded a $2,500 scholarship spread over two semesters.

SayCampusLife.com does not endorse specific scholarship opportunities and we encourage our readers to avoid those requiring appliction fees or numerous strings attached. We review each opportunity posted and assume the information presented to us is correct. If in doubt about a particular scholarship, then scratch it from your list.