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Financial Aid For School - Financial Aid for School - Financial Aid Grants, Scholarships, Student Loans, Federal Work-Study Financial Aid

Basic Options for College Financial Aid

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In the modern world, there are fewer and fewer career options for those who do not have a college degree. The cost of a college education, however, is well beyond the resources of many families, especially if the student is looking at going to a high-priced school like Harvard. Financial aid is a necessity, therefore, for many, if not most, students. However, many students and their parents sign-up for financial aid without properly educating themselves first on the types of financial aid, including student loans and their repayment options. In general, there are four types of financial aid for students: grants, scholarships, student loans and work-study programs.

Financial Aid Grants

Since a grant does not have to be repaid, it is the most desirable type of financial aid for students. It is typically based on financial need and most grants are based on federal and state funding. The most common type of grant is the Pell Grant. This grant provides up to $5,350 towards the tuition of undergraduate students. In addition, Congress recently approved the Federal Supplemental Educational Opportunity Grant, which could provide another $4,000 per student. Other federal and state grants, such as the Teacher Education Assistance for College and Higher Education grant, are also available. Students should begin looking for aid at the Free Application for Federal Student Aid site.

Also, many colleges, especially those with high endowments like Yale and Harvard, have their own grant funds to provide financial aid. Students at these universities that come from low income families often do not pay any tuition.


In general, college scholarships can be divided into two categories: merit-based scholarships and regional scholarships (including national scholarships). Merit-based scholarships are available to students who excel in a particular area: anything from academics to athletics, art, and music. Most of these scholarships are available by application, so a student who is interested should be sure that the school they are considering offers a scholarship in their area of expertise.

Regional scholarships are often based on a number of factors, including ethnicity, religion, and professional interest. Some regional scholarships are merited-based, such as those given by the local Kiwanis Clubs to high school valedictorians. Some of the regions covered by such scholarships are cities, counties, states, and even at times the whole country. The “region” does not necessarily have to be a geographic region either. Professional organizations or clubs often give out scholarships to students that will be pursuing a specific degree. In addition to filling out the FAFSA, students interested in these scholarships should search the internet, speak with teachers, and talk to someone at their local library or their college counseling center to find out what types of scholarships they could apply for.

Student Loans

In addition to the grants and scholarships, many students choose to take out loans to supplement their financial aid. College financial aid loan options can be divided into two categories: federal loans and private loans.

There are two major categories of federal loans: Perkins loans and Stafford loans. Perkins loans are typically reserved for undergraduates living on campus and have a lower interest rate (it is currently capped at 5%). Stafford loans are for both undergraduate and graduate students, and may either be subsidized or unsubsidized. If they are subsidized, then the federal government will pay the interest as long as the student is enrolled, and repayment begins 6 months after graduation. Unsubsidized loan payment may be deferred as well, but interest will accrue from the day the loan is issued. Stafford loans typically have a higher interest rate than Perkins loans (they are currently capped at 6.8%). Also, Congress has recently passed laws for income-based loan repayment and loan forgiveness for certain professions. More information on these recent laws is available here.

Another type of loan to consider is a private loan. Available for both students and parents, these types of loans typically have higher interest rates and are usually less desirable than federal loans. In some cases, however, merit-based or competitive private loans that have little or no interest are available.

Federal Work-Study Financial Aid

With a program that is mutually beneficial for students and universities, the federal work-study program reimburses schools for the paychecks of students in the program. Although the schools must pay at least minimum wage, many pay more, and these programs can provide students with the opportunity to avoid going in debt while in college

Many options are available for both undergraduate and graduate students looking for financial aid. Financial student aid is available at some level to most students, and with a little research, just about anyone can find the financial resources necessary to attend college.

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