College Financing: How to pay for college without going into debt

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I usually don’t talk much about finding those rare and mysterious scholarships. You’ve heard the rumors. There are millions of dollars left on the table from scholarships that go unclaimed.

The fact is about 3% of the money available can come from outside scholarships. Basing your entire college financing plan using outside scholarships is very dangerous. These are the scholarships that come from outside companies or endowment funds. They are monies that don’t come from the college or federal government.
In this post I’m going to talk how to find more of them but I also want to cover what free money is available from the universities and Federal Government.

Some people think these outside scholarships are as hard to find and the spotted white owl or the unicorn. The fact is your child should start looking for these scholarships when they are sophomores or juniors. One very good resource is www.fastweb.com.

You child should be looking for scholarships that require them to complete something. Let’s say there is a scholarship requires them to answer 10 questions or another that requires them to perform 1 hour of community service. How many other kids do you think will complete the community service? Right the pool of potential applicants for the community service scholarship will be much much smaller. Along those lines you want to look for scholarships that are unique. If the scholarship requires them to help elderly people for 20 hours then they should do it. Your children should be looking for scholarships that require them to perform an activity. For this reason they should be starting when they are a sophomore.

From the Federal side. The most common and well known grant is the Pell Grant. It’s for undergraduates study only. The maximum Pell Grant is $3,000 per year. It’s a need based grant I’m sure President Obama will increase this grant.

Another common federal grant is the Federal Supplemental Educational Opportunity Grant or SEOG. Like the Pell Grant, the SEOG is awarded based on financial need and is for undergraduate study. The cap is $1000 per year.
Colleges and Universities often provide their own grants for students. The amount of the school grant varies, but they do take into consideration a number of factors in issuing these types of grants including: financial need, grades, merit or program of study. These programs vary widely so you should check with the college you’ve been accepted to for more information.

Even though college costs are trending upward, there are many financial aid options for students. Outside scholarships to help with some of the cost of college are useful but should not be your only plan. What scholarships is your son or daughter receiving? How are they looking for them?