As the 2018-2019 school year comes to a close, many high school seniors are looking ahead to their college years. For most students and parents, this means spending some serious time figuring out how to pay college tuition costs.
A College Board survey found that the average tuition costs have tripled at both public and private schools. To attend a public college, it costs an average of $10,230 in tuition, fees, and living costs per year. Someone hoping to attend a private, nonprofit school, could end up paying more than $35,000 a year.
Fortunately, there are many options available to students who are looking for ways to pay for school, including one of the best ways: scholarships.
Why Are Scholarships So Beneficial?
Most students will rely on some type of financial assistance to pay for college but financial aid shouldn’t be the first place a student starts. Before taking out any loans, students should apply for as many scholarships as possible.
According to Sallie Mae, a private lender and bank offering student loans, credit cards, and more, students use scholarships to pay for only 35% of their college tuition. Let’s look at a few reasons why scholarships should take priority over all other forms of aid.
When students earn a college scholarship, that’s free money they never have to pay back. Federal student loans, and even some private student loans, come with low interest rates and flexible repayment terms, but that’s still money they are going to have to repay after they graduate.
60% of college graduates leave school with enormous amounts of student debt – nearly $28,000 per borrower in fact. This seriously impacts their careers and lifestyles going forward. Minimizing student loan debt will give them more freedom and options after graduation.
Funding Is Available Year Round
One of the best things about college scholarships is that funding is available all year long. Because there’s an abundance of scholarships to apply for, students can always find new opportunities from all kinds of organizations like The Idlewild Foundation! For example, the Idlewild Foundation’s scholarship with a fall application deadline starts accepting applicants in February; additionally, the application period starting in fall ends by April 30 the next year.
A common misconception many students have about scholarships is that they have to wait until they are already in college to apply. It’s actually best for students to start applying while they are still in high school. Students should begin applying early and to a variety of sources and this will increase the odds of earning more free money.
Opportunities are Widespread
There are thousands of opportunities to earn scholarship money, and students don’t have to have a 4.0 GPA to qualify. Academic scholarships are quite common but there are also scholarships available for students that excel in athletics or other extracurricular activities.
There are also quite a few niche opportunities that can give certain applicants a higher chance of success. For instance, there are scholarships that are designed specifically for women or minorities. There are also community service scholarships awarded to individuals who have spent a lot of time volunteering.
Can Cover Full Cost of Attendance
Unlike most other forms of aid, there is no limit to the number of scholarships a student can earn. If a student is able to win enough, it’s possible to use scholarships to cover the full cost of college attendance. In fact, several applicants with Idlewild Foundation forwent their scholarship opportunities due to an overload of previously won scholarships already covering the cost of attendance!
Why Students Should Avoid the Alternatives
Of course, there are several alternatives to scholarships, but they all have their drawbacks. Pell Grants are a good option since they also don’t need to be repaid, but these are only awarded to select students with financial need – so not all students qualify
Most students will also rely on federal student loans, but there are a number of disadvantages to this. First and foremost, federal loans (like all loans) will have to be repaid. For certain loans, the interest will start accruing while the student is still in school, simply adding to the cost of repayment.
The financial impact extends beyond the wallet, too. For example, missing payments on a student loan may have an adverse effect on a graduate’s credit score, and the obligation of repayment often delays important life milestones like starting a family or buying a home at a crucial stage in one’s early career.
Plus, applying for federal loans is a more rigid process since these loans are only available during certain times of the year. And according to the U.S. Department of Education, the national default rate for students loans is 10.8%. Woah. Furthermore, student debt is notorious for the way it’s addressed during bankruptcy; while it’s not impossible, it is quite difficult to discharge by proving undue hardship.
There are also private student loans, but these often aren’t as ideal as federal loans. They typically come with higher interest rates and less financial hardship options during repayment. In addition, the credit requirements can be quite rigorous, so students may be required to apply with a cosigner, which comes with risks of its own.
When it comes to paying for college education, scholarships are obviously the best bet. But while scholarships may be free money, it isn’t possible to get something for nothing. Applying for scholarships will take quite a bit of hard work.
Students will have to invest a lot of time and effort into researching different scholarships, finding out the requirements, and applying before the various due dates. But if they can put in the work, they will have a better chance of succeeding.
Check out scholarship searches like this one to quickly narrow down opportunities to only those that are personally relevant.
Successfully earning scholarships could save thousands, if not tens of thousands, in college costs.
Andrew is a Content Associate for Lendedu – a website that helps students and other consumers with their finances. When he’s not working, he can be found hiking or hanging with his cat Colby.