How To Find Alternatives to Student Loans

If you are planning to go to college it is likely you are already aware of how expensive it can be. While it is possible to go to school for free, for now, the loans you accrue will have to be paid eventually. It is easy to go to school and not give your loans a second thought. However, when school is over you might end up shocked by how much you actually owe. There are thousands of people who pay for years on their student loans before they finally pay them off.

However, there are some reasonable alternatives to student loans. While some are more reasonable than others, the options make it possible to lower your student loans by a considerable amount or to see that you do not need loans at all.

You should consider any possible loan alternatives if there is a chance that they could save you money. Do your homework and investigate all of the possible alternatives to student loans before you allow the interest on your loans to accrue and affect your credit report.

  • Financial Aid - The obvious starting point for any future college student should be financial aid. Even if you think you will not be given any money you should fill out a FAFSA (Free Application for Federal Student Aid) to be sure. The more money you receive for financial aid the less you have to find elsewhere. Financial Aid is a government plan that is meant to help lower-income individuals afford to go to college. This money is given to people struggling financially and does not have to be paid back.
  • Scholarship Lotteries - Scholarship lotteries are often offered by education lenders. In most cases, sites that offer student loans will have scholarships lotteries. They will draw numbers and the winners will receive $1,000.00 to pay towards their education, or more depending on the prize. While these are not the easiest to win and they will not pay the entire cost of your education, it doesn't hurt to enter nor does it cost anything. Some lenders that offer these lotteries include Wells Fargo, Bank of America, and US Bank.
  • Traditional Scholarships - Depending on your grades in high school, your writing skills, and your upcoming college major, it is possible to gain a scholarship. You can get as many scholarships as you can win. Your future college may have specific scholarships available so you will want to inquire with your institution about the possibility for scholarships. Also you can find national and worldwide scholarship information available online at sites like FastWeb.
  • College Savings Plans - If you have some time before you or your child begins school you can always sign up for a college savings plan to ensure that you have some money ready when the time comes. The IRS offers tax exempt plans, known as Section 529 plans. The account owner, generally a parent (but it can be the student as well), can add and invest funds. You can begin one of these plans when your child is any age, even beyond 18 years old.  Your child(ren) will not have access to this account, so if they decide not to go to college they will not have access to how the funds are spent. These plans are an excellent option for raising money for college.
  • Volunteering Scholarships - Scholarships like Americorps allow you to do volunteer work in exchange for money that can be used on a college education.  Each volunteering opportunity will be slightly different, so you should inquire about the terms of the volunteer relationship prior to beginning. When working with Americorps, you can expect an 11-month residential program that pays $4,725. The program is eligible for 18 to 24 year-olds and the money can be used to pay for school or previously awarded loans. The money can be left in savings for seven years, if necessary, before being used.
  • Military Aid - If you have been in the military or are willing to go you could receive a hefty sum of money that will be paid towards your college education. Many people end up going into the military with hopes of receiving help for college. The Montgomery GI Bill was created to offer tuition assistance. Currently, the GI Bill will pay for about 3/5 of your education.
  • Additional Options - You may be able to receive additional help if you are disabled or considered a minority. The Financial Aid site has a wonderful list of alternatives to loans and places where you can go to sign up or simply find out more information about financial aid as a whole. It is possible that these additional sources could pay your college tuition altogether. You can find the information concerning this and other options at the Financial Aid Web Site.

Using one or more of these sources will allow you your best chance of paying for college without having to use loans at all. Of course, with some of these sources, loans are still required, but potentially at a considerably lower price.

 

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