How Are You Paying For College?

How Are You Paying For College?

As high school students, all you can think about is going away to college, all the parties you are going to attend and getting away from your parents. But how to pay for college, which is the most important thing, has been put on the back burner.

Paying for college is no easy task, unless you are the top 5 percentile of your school who can get a full academic scholarship or an athlete who can get a full athletic scholarship. Nevertheless, what about the ones that dangle helplessly in the middle. What are they to do when their only options are loans and financial aid.

The majority of teens today don’t know that they have options or what they even are. I am here to give you a small insight to the do’s and don’ts about the financial aid and loan process that most of us (even our parents) don’t know about.  

Any time that you receive money from anyone other than your parents or a close friend, chances are you have to pay it back; this is true when you borrow from the government or a major bank. When you have completed college, or a circumstance occurs that prevents you from continuing school, the money has to be paid back. Generally, it’s not just the amount that you take out but also the added interest for how long it takes you to pay them back.

Government loans are different as they have more options for you than a bank would. One that mostly all students will recognize is the Stafford loan. This loan comes in two forms — the subsidized and unsubsidized.

What does that mean?

Well, the subsidized loan does not accrue interest while you are in school; this lessens the amount of money you would have to pay back when you graduate than with an unsubsidized loan. However, when you do graduate and after the initial grace period that they give you to find a job and get settled, the clock starts ticking and so does the interest rate.

Now some may be asking “What is an interest rate?”. An interest rate is a rate which is charged or paid for the use of money. This means  you are paying the government (Stafford loan service) to use their money so that you can get an education to make them more money in the future.

How can you apply for these loans from the government?

Well, that is where your FAFSA comes in. It is important you utilize that service, so you can receive the maximum amount of money available for your education. Sometimes, this still isn’t enough because college can be more than expected.

However, there is more funding available for low-incomes students.. It is called the Perkins loan which is included when you fill out your FAFSA online. The Perkins loan is given to students by their school. This loan is based on exceptional need. The Perkins loan usually has a lower interest rate than other loans — leaving you worry free when it comes time to pay them back.

If you have parental support, they also have the option to take out loans. But leave this option to the last resort, because that is a very large responsibility placed on your parents and you. If you decide to slack off and not pay those loans back, then not only is that a disadvantage to you but to your parents as well. It doesn’t make for a very good conversation starter at the dinner table.

The FAFSA is on a first-come first-serve basis, so get it in early. Not paying loans back can be detrimental to you and your parents — if they take out parent loans. Your parents and you will be obligated to pay, and if you don’t the government can seize your home, car, bank accounts and tax returns until you do.

It’s like dealing with the mafia, when they want their money someone better have it, or you will be sleeping with the fishes. Think about private student loans before you involve your parents. This is usually Sallie Mae or Wells  Fargo.

We have gone over some great options for paying for college with government loans but sometimes that’s not even enough. Scholarship options are great, and they give them to people who don’t mind writing a little letter, if your left-handed, if you want to go into a particular field etc. there are options for you. So don’t be lazy do some research and get college paid for, because it’s no fun when you have to work full time and go to school.



PITSKER, K. (2016). AN ALTERNATIVE TO STUDENT LOANS. Kiplinger’s Personal Finance, 70(7), 13.

Porter, B. (2008). College Financing Information for Teens: Tips for a Successful Financial Life: Including Facts about Planning, Saving, and Paying for Post-Secondary Education, with Information about College Savings Plans, Scholarships, Grants, Loans, Military Service, and More. Reference & User Services Quarterly, 48(2), 192.

Rustomfram, P., & Robinson, B. (2015). Online Government Resources for Financial Literacy. Journal Of Business & Finance Librarianship, 20(1/2), 95-115. doi:10.1080/08963568.2015.977083

[author image=””]
Jasmine Brown, Guest Writer
Jasmine Brown is a Senior Psychology student from Dallas, Texas. Her passion for helping people carries over in all aspects of her life. [/author]