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Resource CenterPaying for CollegeFinancial AidTypes of Financial Aid Available

What Types of Financial Aid Are Available to Help with Paying for College?

The financial aid process often feels overwhelming to families.  Indeed, between the jargon, the paperwork and all the deadlines, there’s a lot to juggle and decipher.  Before you begin to truly wade through everything, you first need to understand the aid options that exist.

Two basic categories of financial aid:

  1. Grants and scholarships (gift aid that is based on merit or need and does not require repayment)
  2. Self-help (loans and student employment)


Four sources of financial aid:

  1. Institutional (colleges and universities)
  2. Private (corporations; community, religious, cultural and fraternal organizations; etc.)
  3. State government
  4. Federal government


Types of financial aid available:


Generally the most desirable form of financial assistance, grants are gift aid and require no repayment. They are offered by both the federal and state government and are based upon financial need. Additionally, the colleges or universities to which you apply may also have grant money available. Depending on your FAFSA results, financial aid offices will automatically consider you for many federal, state and institutional grants. One of the biggest federal grants, the Pell Grant, is for undergraduates only. The government employs a formula to determine if a family receives Pell Grant funds.


Student loans provide families with immediate access to funds to help cover the cost of attendance. While that might sound like a terrific opportunity, it’s imperative to recognize these funds must be repaid, with interest, over a period of time. Therefore, while loans will reduce the immediate burden on your family, they do not reduce the true overall cost of your education.

The advantage of using a student loan, as opposed to other commercial loans that might be available, is that the interest charged on student loans may be subsidized by the federal government. Further, repayment is typically not required until after graduation.  Of course, there are also unsubsidized loans where the interest accrues as soon as the funds are used. However, once again, you will not be required to begin repayment until after you leave school.  Finally, be aware that both subsidized and unsubsidized loans can vary in terms, length and repayment time.

Merit Scholarships

Colleges and universities often provide scholarships to students in their applicant pools who they deem academically talented. The amount awarded can vary greatly between scholarships; some might partially cover expenses whereas others might finance the total cost of attendance (aka tuition, fees, room and board, books, and even a stipend). Most of these scholarships are extremely competitive, requiring personal interviews and essays among other criteria. 

Work Study

Work-study programs allow students to work on campus (or at an approved location) in jobs for which the federal government provides the payment. Hourly wages and positions vary at each school. Many campus offices such as athletics, the student center, career services, bookstore, residence halls, admissions and academic departments use work-study students.

Of course, even if you do not receive a work-study position, you can likely find campus employment.  Many schools hire additional student workers who are not on the work-study program. You should contact the financial aid or student employment offices prior to the start of your first semester and ask about the various opportunities available. Each college has its own procedures for posting and hiring student workers, but it’s definitely worth your time to inquire about the possibilities.

Beware of financial aid scams!  You should never have to pay someone to find money for college!  Contact your state financial aid or student aid agency for help if you need it.  Not only will they offer you the best advice about the types of aid available to you, but they can direct you to various resources in your area.  Lastly, talk to the financial aid officers at the colleges that interest you to determine what is available through the institution.


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Don Munce