College  |  September 26, 2018  |  Rob Zodda

Students—here’s how to pay for college in 3 simple steps

What you'll learn
  • How to search for free money for college
  • What the heck FAFSA means
  • Questions to ask before taking out a private student loan

When it comes to deciding how to pay for college, there’s a lot of information out there. It can feel totally overwhelming—but it doesn’t have to. You’re already on the right track just by doing a little research. Here’s a high-level checklist to help you get started.

1. Start with money you won't have to pay back, like savings, scholarships, and grants

Savings

Maybe your family has money saved for college—or maybe not. That’s okay! Just have an honest conversation. Before you can decide how to pay for college, you need to know your family’s answers to these questions:

  • Is paying for college your responsibility only or will your family help?
  • How much money does your family have saved for college?
  • How much savings can you contribute to your own education?
Scholarships

College scholarships are free money for college—you don’t need to pay them back. They’re offered by colleges, towns, states, religious organizations, companies, non-profits, and more. Scholarships can often range from $500 to more than $25,000. So yeah, scholarships are worth your time and effort. Your future self will thank you.

A few key facts about scholarships:

  • You need to search and apply for scholarships. Try a free tool like Scholarship Search. Applications might require an essay or other submission.
  • Apply for scholarships early and often. Start during your junior year of high school and apply every year through college. Think of scholarships as an ongoing item on your checklist.
  • It’s okay if you’re not a straight-A student. There are tons of different types of scholarships out there.
Grants

Grants for college are another free money option. The difference with grants is that they’re usually given out based on financial need, while scholarships can be awarded based on your skills, hobbies, interests, ethnicity, religion, and more. For example, Federal Pell Grants are the largest source of federally funded grants. They’re awarded solely based on your financial need.

To qualify for grants, your family needs to fill out the FAFSA (Free Application for Federal Student Aid), a form that determines how much federal financial aid you’re eligible for. You can submit the FAFSA as early as October of your senior year of high school. And federal aid is first come, first served, so don’t put it off!

2. Explore federal student loans

If you need to borrow money for college (and most students do), start with federal student loans. Federal student loans are money you borrow from the U.S. government. The benefits of federal student loans are that they usually have lower interest rates and more flexible repayment options than private student loans.

To qualify for federal student loans, again, you need to submit the FAFSA.

FAFSA quick tips:

  • Ask for a parent’s help (you’ll need some of their financial info)
  • Save time by gathering necessary documents in advance
  • Submit the FAFSA each year you’re in college

3. If you still need money, consider a private student loan

Private student loans are offered through banks, credit unions, and other financial institutions. You’ll want to look for the lender that offers the lowest interest rates and loan repayment options that work for you.


Need money for college?

Consider a Sallie Mae® private student loan

  • Available for online or on-campus study
  • Competitive fixed and variable rates
  • No origination fee or prepayment penalty
  • Multi-Year Advantage: Returning undergraduate students have a 95% approval rate with a cosigner1
blog cross sell ad photo of a young female girl student sitting at her desk studying with notebooks, headphones, and laptop.

When taking out a private student loan, be sure you can answer these questions:

  • When will your first loan payment be due?
  • How much will your monthly payment amount be? (This might depend on the repayment option you choose. Try a student loan payment calculator to see your options.)
  • What’s your interest rate?
  • Is your interest rate fixed or variable? (meaning, is it always the same or can it change?)
You’ve got this

By talking to your parents about how to pay for college and by doing a little planning, you’ll feel confident and ready when it comes time to pay that tuition bill.


1. You must apply for a new loan each school year. This approval percentage is based on students with a Sallie Mae undergraduate loan in the 2018/19 school year who were approved when they returned in 2019/20. It does not include the denied applications of students who were ultimately approved in 2019/20.
Sallie Mae does not provide, and these materials are not meant to convey, financial, tax, or legal advice. Sallie Mae makes no claims about the accuracy or adequacy of this information. These materials may not reflect Sallie Mae’s view or endorsement. Consult your own attorney or tax advisor about your specific circumstances. Reproduction without explicit permission is prohibited.
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