Are there alternatives to student loans?
Updated on August 8, 2019
With tuition costs rising in many parts of the US, student loan debt is at an all-time high, as students look for ways to pay for their education. While student loans can be very helpful to get you through college, they can also limit you financially later in life. Many students going into college may find themselves wondering if there are any alternatives to student loans. Here are some potential alternatives to consider before taking out a student loan.
If your family can afford it, it may make more sense to borrow money from them to pay for college instead of taking out a student loan. The best reason for this is because you can pay them back on your own schedule, and you won’t end up paying huge amounts of money in interest later on. Your parents can also consider taking out a Parent Plus loan. In some cases, it makes more sense for the parent to take out the loan, because they have a higher source of income and can pay it back more quickly.
Getting a scholarship is one of the best alternatives to taking out a student loan. It’s worth taking the time to look into and apply for all the scholarships that your school offers – you never know what you might be able to get some scholarship money for. You should also look beyond your school, as many other organizations offer scholarships for specific types of students. Begin looking into scholarships a year or two before college starts if you can to make sure you are as prepared as possible.
Grants are very similar to scholarships, but they are based on need instead of merit. Grants are another very good alternative to student loans, and since they are based on need, they may be a little easier to qualify for than a scholarship.
Work-study programs are a great way to pay for college without getting into debt. They are particularly popular for graduate students, but you can find work-study programs for undergraduate students as well. While this does require a time commitment, it means you won’t have to worry about making payments later on.