Student Financial Aid: Grants, Loans and Work-Study




Student Financial Aid – What to expect from Pell Grants to loans to work-study programs.


So you finally got into college. Congrats! But, the question remains – how will you pay for it? If you haven’t done so already, please head over to and apply now – it’s free, so you’ve got nothing to lose! Even if your parents make enough money, I still highly recommend applying. You have until June 30th, 2015 to apply, but sooner the better.


Opening up your financial aid package is probably just as nerve-wracking as opening up your acceptance letter. After all, this may be the determining factor in choosing the college you attend. When you open up the letter you will see words like: Federal, Direct Loan, Grant, Subsidized, Unsubsidized, Work-Study, etc. I know it can be quite confusing as I definitely didn’t understand what I was reading the first time I looked at it. So let’s take it apart one by one.




  • Federal Pell Grant: If you got this – CONGRATULATIONS! Basically this is money towards your tuition, and you won’t have to pay this back. You want as many grants as possible. Private schools have their own grants that they may award you as well.




  • William D. Ford Federal Direct Loan Program: This is a loan, so that means you will have to pay this back with interest. There are two words you want to pay attention to: subsidized and unsubsidized


    • Direct Subsidized: These are great because the government will pay the interest on the loan while you’re in school and during deferment periods (usually they will give you 6 months until after you graduate before you have to start paying these off). If you are in need of financial assistance, this is the type of loan you will most likely get. Most families with an income of less than $50,000 will receive this type of loan.
      • You can receive: $5,500-$12,500/year
    • Direct Unsubsidized: Interest payments will be added to the loan balance, but you can defer the payments until after you graduate. Everyone is eligible for this type of loan.
      • You can receive: $5,500-$12,500/year


  • Federal Perkins Loans: These are the best loans! This is a campus-based low-interest loan for students with exceptional financial need. You don’t have to pay these off until 9 months after you graduate. This is a subsidized loan (again meaning that the governments pays the interest during the time you’re in school and during the 9 month deferment period)
    • Usually limited to $5,500/year for undergrads


  • Direct Plus Loans: Loans for parents
    • There is no minimum amount, but a credit check is required of all parents.




  • This allows you to earn money part-time during the school year.
  • You are awarded a specific amount of money that you can earn per year.
  • Work-study jobs can be on-campus or off-campus jobs.
    • The school career site will usually post up jobs specifically for work-study candidates.


So, you didn’t get enough, now what should you do?


1) Contact the Financial Aid Office


Contact the Financial Aid office and see if you can schedule a meeting to review your offer. After you’re accepted, it’s common to visit the school. During this visit, I highly recommend meeting with a financial aid officer and going over your financial aid package.


Make sure to tell them why it isn’t enough. Do you have a special circumstance that they aren’t aware of? Why is it that you only got a certain amount? These are all questions you should be asking and talking to them about. It’s great to stay in touch with them, as they are the ones who can really help you with this.


Also, if anything has changed financially in your family, such as a parent getting laid off, please let them know. This could make a big difference.


Keep in mind that it’s usually more likely that private schools will have the ability to increase your financial aid award. That being said, whether it’s a public or private school, it never hurts to ask!

2) Direct Plus Loans


If your parents have good credit then I’d look into getting the Direct Plus Loan to cover the rest. Make sure to consider living expenses when you are calculating how much you need. This will depend on whether or not you have campus housing/meal plans, but I’d say if that’s not included, think about $15,000 give or take on top for apartment rent, food, books, etc. Please note for cities with higher costs of living like SF, NYC, and LA, it might be more.


3) Private Loans


You could look into a private loan, but at your age, you will almost always need a cosigner since you won’t have much credit. A cosigner is a person that signs off your loan stating that they guarantee the loan will be paid off if you default to pay it. Since your cosigner will most likely be your parents, I’d only go with a private loan if the rates are better than the Direct Plus Loan.


4) Scholarships


While these are less guaranteed there are thousands of scholarships out there that you can apply to. Here are a couple scholarship search tools that may help:



Keep an eye out for deadlines and scams (unfortunately, these exist).


I’d highly recommend looking into ethnicity, religious, community, small business, local, or your interest-based organizations. Even small scholarships are worth trying as it can add it up in the end!


Just a note that receiving a scholarship can alter your aid amount because the entire aid put together cannot go over the amount that it costs to attend the school.


If your financial aid package is not enough, don’t give up. Try out the methods laid out above. If those don’t work, use the resources around you. For example, contact your school counselor and reach out to your mentors. You may be surprised with what they can offer you.


 This was a guest post written by Grace Parke who blogs at


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