Education financing: So your child is
ready to go off to college and you are perplexed over how
you will pay for their education? If you are like most
parents, you have heard of scholarships and loans but when
it comes to the details, here is where you get hung up. If
this is the case, here is a short synopsis of how to
interpret college finance terminology.
Scholarships:
There
are two types of scholarships, undergraduate and graduate
fellowships. A scholarship is a gift in that it does not
have to be repaid like a student loan. Schools, individuals
and various sponsors help fund such scholarships so that
students who qualify can be rewarded or students who can’t
afford to pay for school out of their pocket can attend
college. Because the money is a gift, the funds are
generally reserved for students with specific
qualifications such as academic, athletic and so on. Some
scholarships are set up for students who are interested in
a particular field of study or are just plain need of
financial assistance -education financing
Student Loans:
Student loans are like any type of loan
in that it must be paid back. Education loans are broke
down into three categories – Student Loans (Stafford and
Perkins Loans), Parent Loans and Private Student Loans.
Federal laws set the maximum interest rates and fees that
can be charged. Many student loans offer flexible repayment
terms. In some cases there are loan forgiveness programs in
which a student pays off the loan in exchange for volunteer
work or military service. Private student loans can help
you fill the gap between federal, state or school
assistance loans or scholarships. Private loans are often
called alternative student loans and are based on your
credit. Education financing, these loans must be used for
specific educational expenses. Many websites offer
financial calculators so that you can estimate your monthly
payments and what your debt will be.
Military Student Aid:
For
students who are interested in pursuing careers in the
military, there is military student aid. Education
Financing Aid such as the Montgomery GI Bill covers about
three-fifths of your college education and is good for up
to ten years from the date of your last discharge or
release from active duty or training. The Montgomery GI
Bill is for those who are enrolled in the Select Reserve of
the Army, Navy, Air Force, Marine Corps, Coast Guard and
the Army and Air National Guard. If you are in active duty,
you accept a pay reduction of $100 per month for twelve
months; when you use your benefits you can receive $1,101
monthly for a maximum of 36 months of educational benefits.
This benefit may be used for degree and certificate
programs, flight training,
apprenticeship/on-the-job-training and correspondence
courses – if the veteran is enrolled full-time. Part-time
students receive less but can stretch out their funds
longer. Reserve veterans have their own unique
benefits.