It is a well-known fact that America is an expensive country for higher education. The last year of high school can be a period of flux for both teenager and parents. On one hand, you’re researching, identifying, and applying to multiple universities, while on the other, you’re juggling the financial impact of getting the numbers to add up.
The financial angle is even more relevant when you consider that 47 percent of undergraduates in America have an annual family income under $40,000. A combination of scholarships and financial aid, coupled with student and parent loans, are the basic funding pools.
Most US universities have a lower fee structure for in-state students and much higher tuition fees for both international and out-of-state students. Part of this is down to the funding structure of the universities and the grants they receive from both state and federal government.
You need to look thoroughly at the scholarship and financial aid offered by both the state and your chosen university. The amount of scholarships and aid offered as well as the eligibility criteria will vary across the universities, but you should explore and exhaust these avenues first before you move on to the loan options.
Plan to fill in your FAFSA form for financial aid as soon as it becomes available in early January; by the submission deadline of July 1, the bulk of aid has already been disbursed as requests for financial aid are processed on a first-come, first-served basis.
Start with state-level scholarships such as HOPE in Georgia and the Bright Futures Scholarship Program in Florida. Most of these scholarships are funded by the state and federal government with some private funding in the form of donations.
Most universities have their own scholarship programs that may be funded in part or whole by corporations and private individuals. Scholarships and financial aid can be both need-based and merit-based, and you need to be clear on the basis of your application.
Donations and endowments from private and corporate philanthropy form a significant part of scholarships that are offered at various universities. Lord Laidlaw is one such individual who regularly donates funds towards university scholarship programs, and he made headlines recently with a donation to his alma mater, Columbia University (see Lord Laidlaw donates $2 million). The highly successful Scottish businessman and former member of the House of Lords is currently the owner of Laidlaw Capital Management and Laidlaw Estates. In his words, “Scholarships are a direct way to give more people access to the world-class education I had at Columbia.”
The next avenue to explore is the area of student loans. These are either federal loans offered by the government or private loans from institutions such as banks and credit unions. These are loans that need to be paid back with interest, and federal loans are often a preferred choice due to a lower interest rate and greater flexibility in repayment.
The financial planning required for college education is often at par with that of buying a house, what with the meticulous planning and budget balancing required. Scholarships and financial aid are the silver linings that parents and teenagers can count on.