10 Best Alternatives to Student Loans
Getting into the college of your dreams is only the first hurdle many students need to overcome. By far the most difficult part of going to college is coming up with the money to pay for it. With student loan problems splashed across every newspaper, blog and financial website in the universe, many students are beginning to explore alternatives to traditional student financing. We’ve rounded up the 10 most promising alternatives.
1. Peer-to-Peer (P2P) Lending
Peer-to-peer lending, often abbreviated to P2P, is a type of private loans which takes place between two individuals, or peers. Some characterize P2P lending as the corporate world’s spin on ‘one friend loaning another some money”. While perhaps an oversimplification, that’s essentially what it is. In peer-to-peer lending there are no credit checks, bank or government involvement in the loan itself. Private lenders offer loans for a set interest rate and it’s conducted as a private business. The largest lending platforms in the United States are Prosper and Lending Club.
2. Work Study Programs
If you’re already working part-time, you may qualify for the Federal Work Study (FWS) Program. This is a fund maintained by the government to help students who work part-time and go to school full time. Applications can be submitted through your school’s Student Office as well as directly through the program’s website.
3. Tuition Reimbursement
Many companies offer a tuition reimbursement program. These program pay students back a portion of their school tuition, but does not include fees or textbook costs. This kind of program is typically offered in companies that traditionally promote from within and have various options for career growth.
You don’t always need to have the best grades or crazy athletic skills to land a scholarship. Scholarships are awarded by schools, companies, organizations, clubs and churches. There are thousands of scholarships that range from a few hundred dollars and go up to $10,000 and more. Local scholarships can be found through community organizations, churches and private businesses. Check your local library, community swim team and the local businesses that support softball, baseball, football or other local teams. Have your parents ask at work – many companies offer special scholarships to the children on employees. National and international scholarships can be found easily online or with the help of a high school or college adviser.
In contrast to scholarships, grants are typically need based and are offered through the Federal Government. These grants can be applied for directly through the student aid website of the US Government. Several grants are also available at the state level. Grants do not have to be repaid and can be applied for either once a year or, in some cases, during each quarter or semester.
7. The Military
Every branch of the US Military offers a number of grants, scholarships and financial aid opportunities for active and former servicemen and women as well as the families of those soldiers. If you’re willing to postpone college a few years and enlist yourself, you could easily get a free ride, no matter what your degree. As a bonus you’ll get plenty of hands on experience in your chosen field and a history of military service makes a great impression on resumes and in an interview.
AmeriCorps is a program maintained by the US federal government. It aims to get people more involved with various non-profit charities, schools and other community centered organizations on both a state and national level. It could involve working with the homeless, teaching children how to read, working with at risk teens or any other kind of public service. A 12 month stint with AmeriCorps snags you a living allowance, help with housing and, once you’re done, some nice Education Credits you can apply to your tuition and other education costs.
9. Cap in Hand
Where do people turn to in times of trouble and need? The internet, of course! Hitting up people for small (or large) donations online is nothing new, but plenty of people never consider it when looking into ways to pay for college. From asking for financing on a specific university project through a website like Kickstarter to just taking up a page and using it to ask for donations, the internet can be a great way to raise funds. Alex Tew made history in 2005 when he set up the Million Dollar Homepage and sold ad space online for $1 per pixel in order to pay for his university education in Wiltshire, England. The ploy paid off and, in 2006, Tew grossed $1,037,000.
10. Rich Relatives or Winning the Lottery
Perhaps a bit less pragmatic than our other options but, hey, if you haven’t seen Great Uncle Norbert for awhile, this might be a great time to catch up! Failing that, hit the Bingo haul with Grandma and don’t forget to borrow one of her lucky troll dolls!