Maybe you saw the writing on the wall, or perhaps it came as a total surprise. You were a victim of company layoffs and now you are wondering what to do next. Additional education is an option that will allow you to reinvent your marketability, but paying for college with no current income may feel like the impossible dream. Is it? Not with these options in college financing.
Higher education is a pricey endeavor, especially if a layoff has left you without a regular source of income. However, a degree may be just the ticket to make your next career move as recession proof as possible.
Help from Uncle Sam – Financial assistance is available at both the federal and state level. Many, like the Pell, are restricted to students pursuing their first undergraduate degree and are based on financial need. There is talk that Pell grant funding may increase with the latest stimulus plan, making grant amounts larger for qualifying candidates. Some states also have financial assistance available. Contact your state government office for financial aid, or check out the Sallie Mae website at salliemae.com for federal assistance.
Scholarships for Grownups – While scholarship competition is fierce for recent high school graduates, the field is more open for scholarships geared to adults. Your school’s financial aid office is the best source for these programs, but you can also search online at scholarshipworkshop.com for more information. In some cases, your work experience may even be a factor in winning financial assistance.
Lending Options – Student loans come due after graduation, but rate and terms are usually reasonable. Most will be based on financial need, although criteria for loans are generally less strict than for grants. Federal Stafford Loans are a common choice, and more information can be found at Staffordloan.com.
Tax Deductions – Tax deductions are generally restricted to those working to maintain or improve standing in a current profession. Those moving into an entirely new career are not eligible for a deduction. However, if you fall into the right income bracket, you can claim a Lifetime Learning Credit of up to $2,000, according to Kiplinger.com. Talk to your accountant for additional information about tax breaks.
Tuition Discounts – Yes, age means wisdom, but in some states it can mean reduced tuition prices as well. If you are between the ages of 60 and 65 and attending a state college or university, you may be able to save as much as 50-100% of the cost of your tuition. Even if your state doesn’t provide this benefit, you can call individual institutions to see if they offer any such deal.
Work Study – Work study allows students to work on or off campus at approved jobs to help pay the tuition bills. Sometimes, the work is related to the field of study, providing valuable resume experience along with the necessary funding. Payment is based on a minimum rate and hours are usually worked around the student’s school schedule. Work study is awarded based on financial need and interested students must apply for the program.
Service Programs – This option allows you to pay for school and help others at the same time through organizations like AmeriCorps, Learn and Serve America and the Peace Corps. Most of these organizations require that you serve for a period of time first and then they will pay for part or all of your education afterward.
Job Experience for College Credit – If you’ve been in the work force for some time, you should get credit for the experience that you have gained. Many colleges offer this credit so you don’t have to take as many courses to complete your degree. This saves time and money, making it a good option for many professionals with experience under their belts.
Assistance for Military Veterans – The 9/11 GI Bill allows veterans who served in Iraq educational benefits for up to 15 years after duty. This bill covers tuition, fees, housing and books. Total amount of benefits will depend on the length of active duty service. For more information on the 9/11 GI Bill, go to gibill.va.gov.
Using your IRA – This is a last resort for many, but IRA funds can be borrowed against to pay for continuing education expenses. Keep in mind that while this loan is interest free, it is still subject to precise terms and stiff penalties if the terms are not followed. If you are considering this option for financing education costs, it is important to talk to a tax accountant first to make sure you understand the rules and conditions of this type of program.
With these financing options available, a degree may be much more attainable than you first imagined.