Types of Financial Aid & Funding Options Paying for College
Various types of financial aid are an important component of paying for higher education. Whether you have financial need or not, there are many financial aid options to explore. So, when should you start? That’s good question. There isn’t a clear cut answer because it’s different for everyone.
Financial aid provides monetary funds to cover higher education costs. The funds may cover tuition, room & board, books, supplies, transportation, and other expenses.
When we say types of financial aid, we are actually referring to types and sources of financial aid. You can look for different types of aid, such as student loans, grants, work-study opportunities, and scholarships from different sources, such as the federal government, state governments, banks, colleges, employers, or private scholarship providers. So, what different types of financial aid are available?
Private and federal loans may be available for students. You may also try to get a grant or scholarship. Work study jobs and financial aid for military members or when studying abroad, may also be available.
Below you’ll find an overview of the types of financial aid students can pursue to help cover the costs of tuition and higher education.
- Federal Aid
- Private Student Loans
- State Aid
- Scholarships
- Work Study Programs
- Employer Tuition Assistance
- College / University Assistance
Federal Types of Financial Aid
Types of federal aid you may qualify for include Pell Grants, TEACH grants, FSEOG, and federal work-study programs. For a student who may have had a parent die in during military service in Iraq or Afghanistan after the events of 9/11, you may qualify for Iraq and Afghanistan Service grants. Federal student loans may also be an option for college students.
- Federal Grant ProgramsInformation about the Federal Pell Grant, Federal Supplemental Education Opportunity Grant (FSEOG), Teacher Education Assistance for College and Higher Education (TEACH) Grant, Iraq and Afghanistan Service Grant.
- Federal Loan ProgramsStudent loans offered through government funding through the Department of Education. Federal student loans typically offer low interest rates and generous repayment terms.
State Aid
Many states offer assistance to their residents or to non-residents studying at a college in their state. Assistance can come in the form of scholarships, grants, and/or loans. Certain states have a specific application you must complete in order to be considered for assistance from the state.
Check with the financial aid office at your school to see what state aid programs are available. Learn more about state aid programs and locate the agencies in your state that provide them.
Institutional Assistance
Institutional assistance is aid supplied by the school you attend. It can come in the form of scholarships, grants, loans, and/or through work-study. Check with the financial aid office of the school you will be attending to see what you need to do to apply for this type of aid.
Private Student Loans
Private student loans are made directly to students by banks or other lenders. Students generally need a creditworthy co-signer. You can compare student loans by using our LoanFinder tool. Before borrowing a private student loan, you should use all other forms of financial aid first and borrow only what you need. Learn more about private student loans.
Scholarships
A huge number of scholarships based on need, achievement, affiliation, and/or a myriad of other criteria are awarded to students each year. One source to find scholarships is Unigo. This free scholarship search tool will match you to applicable awards based on your interests, academic background, and more. The site also sponsors a number of unique scholarships that most students are eligible to apply for. Many nonprofit organizations may offer scholarships to students who are eligible. Some private corporations may also provide scholarships. The qualifications for scholarships may vary, such as based on academic merit or area of study.
You should also check with your high school’s guidance office or you college’s financial aid office to see if there are any awards available locally or though your school.
Corporate / Employer Funding
Are you working while enrolled in college courses? If the courses you’re taking are aligned with your career path, you may be eligible for tuition repayment through your company. Check with your employer’s HR department about tuition reimbursement or loan forgiveness programs.
FWS Federal Work Study
The federal government provides funding to over 3,400 colleges to employ students part-time to help offset college costs. In order to receive Federal Work Study (FWS), a student must complete the FAFSA, have financial need, be awarded funds and find a qualifying job on or, in some cases, off campus.
Because funds are made available on a first come, first served basis, it is important to apply for financial aid early. FWS is earned through work performed and is credited to the student in the form of a paycheck. Your hours will be limited to the amount you have been awarded by the FWS program, and you will earn at least the federal minimum wage for the work you perform.
Because federal work study hours are limited, you may be interested to know that some colleges offer work study funds or make work available to students who do not qualify for FWS. Most of these schools will include this allocation in a student’s award letter and need is usually not a requirement to receive funding.
Check with your college’s financial aid office to see if these funds are available or if on-campus work is available to students who do not qualify for FWS.
Work study is meant to be utilized to pay for incidentals ranging from food to toiletries to transportation. If you receive work study in your financial aid award letter, remember that these funds will not be applied to your tuition bill.
NEXT STEPS: LEARN THE BASICS
Before applying for financial aid, it’s important to familiarize yourself with the different types of financial aid noted above. Once you are comfortable it is also important to understand eligibility requirements for each. Here are a few resources to help you move in the right direction.
FINANCIAL AID FOR STUDENTS BY TYPE
The financial aid process looks slightly different for each student. However, there are some steps in the process that are the same for everyone, such as filing the FAFSA. See below for financial aid guides we’ve compiled for high school students, college students, grad students, adult learners, and international students. Each guide covers eligibility, types of financial aid, and extra tips and pointers to getting through the process successfully.