Let's face it: the cost of college like tuition, housing, and textbooks, can quickly add up. Thankfully, financial aid can help reduce the overall price, making your education affordable. Financial aid is money designed to help students pay for college or career school. There are four main types of financial aid that can help: grants, scholarships, work-study, and loans.

To get help paying for college, students and their families have to fill out a form called the Free Application for Federal Student Aid, or FAFSA. Experts say it's important to try to avoid taking out loans, which you have to pay back with extra money called interest. Filling out the FAFSA can help you get work-study jobs and Pell Grants, which you don't have to pay back, as well as federal loans.

Grants and scholarships are like free money - these types of financial aid do not have to be repaid. Students should always explore their eligibility for grants and scholarships before looking at student loans as a payment option, as these do have to be repaid after graduation.

Grants

The biggest difference between grants and scholarships is that grants for students are typically need-based. The federal government gives grants to students in need who go to college or career school and unlike loans, most grants don't have to be paid back.

Need-based grants can come from different places, like the federal government, your state government, your school, or other organizations. The U.S. Department of Education (ED) has different grants for students at four-year colleges, community colleges, and career schools. Look into these programs to see if you're eligible and how to apply.

There are some merit-based grants, too. Merit-based grants are awarded to students who demonstrate high levels of academic achievement, a commitment to community service, or excellent leadership skills. To find merit-based grants for college, start by doing an online search for college grants in your home state. We make this easy by partnering with Colleging to provide you a simple grant and scholarship search tool.

Make sure to do your research and apply for any grants you're eligible for. Also, pay attention to deadlines! Different grants may have different application deadlines, and you don't want to leave free money on the table because of a missed deadline.

Scholarships

Scholarships are like gifts; you don't have to pay them back. And there are tons of them out there! Schools, employers, private companies, and all kinds of groups offer scholarships. A scholarship might cover all your tuition or just part of it. But no matter the amount, it's worth applying for because it will help you pay for your education.

Scholarships can be need-based, merit-based, or based on things like your hobbies, field of study, ethnicity, religion, and more. This means you don’t need to be number one in your class or an all-star athlete to get free money for college.

There are lots of ways to apply for scholarships. You can ask the financial aid office at your school, your high school counselor, or search for scholarship opportunities online. Our scholarship and grant search tool can help you easily find scholarships you may be eligible for using filters for things like school type, ethnicity, and your major.

Each scholarship has a different deadline. Some deadlines are really early, so if you're in high school, you should start looking and applying during your junior and senior years. But don't worry if you miss those deadlines; there are still plenty of scholarships out there for you. Just be careful and make sure the scholarships you find are real. You should never have to pay to apply for a scholarship!

Work-Study

Federal Work-Study is a program that gives part-time jobs to students who need financial help. Work-study lets you earn money by working part-time while in school. You'll earn at least the federal minimum wage, and oftentimes more. How much you can earn depends on your financial need and your school's funding.

These jobs can be on or off campus, and you'll usually work for your school or a non-profit. How much you earn depends on your school's funding and your financial need. Undergrads are paid by the hour, and graduate students can be paid by the hour or by salary. Your school will pay you directly, unless you ask them to send the money to your bank account or use it for tuition and other school expenses. You can't work more hours than you're allowed, and your employer will work with your class schedule.

Tuition Assistance

If you do not qualify for work-study, but still work full or part-time during college, some students may find that their employers provide tuition assistance. Tuition assistance programs can help offset the cost of your degree or certificate program while allowing you to acquire relevant competencies for your current career. Check with your employer's HR department to find out whether they offer tuition assistance and what their eligibility criteria are.

Federal Student Loans

After you've explored free money for college (scholarships and grants), you may want to look into federal student loans, which are provided by the government to help you pay for college. Student loans are money you borrow and have to pay back with interest. If you apply for financial aid, you might be offered loans as part of your aid package. Make sure you understand your repayment options and plan carefully, so you don't get overwhelmed by student loan debt.

There are three types of federal student loans:

Direct Subsidized Loans

Direct subsidized loans are based on financial need. Subsidized means that your borrower does not charge interest on your loan balance with you are enrolled in school at least half-time. These loans also do not incur interest during the grace period (a period, usually six months, after you graduate before you have to start making payment).

Direct Unsubsidized Loans

Direct Unsubsidized Loans are not based on financial need. They’re not credit-based, so you don’t need a cosigner. Your school will determine how much you can borrow, based on the cost of attendance and how much other financial aid you’re receiving.

Unsubsidized means that your borrower will start charging interest on your loan balance immediately and you will continue to incur interest while in school and during the grace period. This can increase the total cost of your federal student loan, so you should always take out subsidized loans, if available, before taking out unsubsidized loans.

Direct PLUS Loans

Direct PLUS Loans are unsubsidized federal loans for parents and graduate or professional students. Direct PLUS Loans for parents are also known as Parent PLUS Loans. PLUS loans can help pay for education expenses up to the cost of attendance (the amount of money your school estimates you’ll need to attend there one year). Eligibility is not based on financial need, but a credit check is required.

Private Student Loans

After you’ve explored scholarships, grants, and federal loans, and still need money for college, you can consider a private student loan. Private student loans are issued by your credit union, bank, or other financial institution and can be used to help pay for undergraduate or graduate school. Private student loans often have higher interest rates than federal student loans, so student should exhaust all other financial aid options before taking out a private student loan. These loans can help cover the cost of tuition, housing, textbooks, and other educational expenses when other financial aid options just aren't enough.

There are two types of private student loans:

Private Student Loans

Private Student Loans are taken out by the student enrolled in college. These loans are credit-based, so they’re often cosigned by a parent or another creditworthy individual.

Private Parent Loans

Private Parent Loans are taken out by the enrolled student's parent or family member. This loan is taken out by the parent or family member to help their student pay for college.

Texans Credit Union offers both Private Student Loans and Private Parent Loans, designed specifically for Texas residents to help all Texans get the education they deserve.