Funding Your Distance Learning
With tuition forever on the rise, only people with significant financial reserves can pay out of pocket for higher education—everyone else budgets time and money while seeking out scholarships, grants, or loans. The difficulty for most people is knowing where to start a search for funding sources.
In recent years, a growing emphasis on building a better-educated workforce—particularly among people who are already employed—has prompted corporations, foundations, and other benefactors to offer more help to people trying to learn practical and marketable skills.Distance learning programs account for a large percentage of courses offered to continuous learners who have to keep professional or vocational aptitudes up to current standards. In many such cases, employers subsidize courses that are related to job performance, career advancement, or occupational retraining.
The U.S. military promotes continuous learning by providing financial assistance to service personnel and qualified veterans who want to prepare themselves for civilian life.
Before starting a hunt for distance learning funds, calculate the total cost for the selected subjects, including books and study materials. Find out which grants and scholarships qualify for the distance learning program of choice and how much each award pays, and then apply for as many as restrictions allow. Apply for student loans only as a last resort and borrow no more than the amount needed to cover expenses. Balance a distance learning program with career goals and the debts that may be incurred.
Funding an online distance learning program begins with professional advice. It may not be in person, but a “visit” with a financial aid advisor is essential to get as much help as possible to fund an education. Financial aid is a broad term for all the methods used to pay for an education, and a financial aid advisor works for a learning establishment to counsel students on how to pursue the best funding options. A financial aid advisor coordinates scholarships, grants, and loans into the most beneficial package available to the student.
In addition to grants and scholarships, many
distance learning institutions disburse financial support from within. During the admissions procedure,
ask what student aid is available from the school and how to apply for it. Whether or not a distance
learning program has self-sourced financial aid may determine which program to choose. The purpose of
financial aid is to keep the student’s monetary contribution to a minimum. Carefully review all the
details of a financial aid package before accepting any money that has to be repaid. Paying back doesn’t
always pay off in the end.
A grant is a type of financial aid that does not have to be repaid. For eligible students, grants are educational gifts from the federal government, state or local agencies, or private organizations. The main stipulation for a grant is financial need rather than scholastic achievement. Usually, a grant is a one-time award for a fixed amount per year. The size of a grant depends on total cost of enrollment, full- or part-time status, semester or yearly attendance, and partial contributions made by the recipient. Most established and accredited distance learning programs qualify for grant money, with special categories of candidates—like single mothers—being especially suited for distance learning programs.
The Pell Grant, administered by the federal government, is the single biggest source of free-ride financial aid for undergraduates. With a nearly $30 billion budget, Pell Grants for the 2010-2011 academic year award up to $5,500 to eligible students. While a Pell Grant may not cover the total costs for all distance learning programs, other sources of funds can supplement the award.
To apply for a Pell Grant, candidates must fill out a Free Application for Federal Student Aid (FAFSA), which also assesses eligibility. The recommended procedure for a FAFSA form is to complete the application online for faster and more efficient processing. After the Pell candidate submits the FAFSA, a review determines eligibility and a Student Aid Report (SAR) notifies recipients about eligibility and the amount of aid to expect—which could be none. To remain eligible for a Pell Grant, the FAFSA must be updated each academic year that the recipient continues an undergraduate program.
A Pell Grant addition that further assists students with extraordinary financial difficulties is the Federal Supplemental Educational Opportunity Grant (FSEOG). This award gives an extra $100 to $4,000 to qualifying Pell recipients. The amount of a FSEOG is based on the date of application, student need, and the particular funding and financial aid policies of the higher-education institution. Recipients of Pell Grants can apply for a FSEOG using the FAFSA form procedure.
Two other Pell Grant accessories, the Academic Competitiveness Grant (ACG) and the National Science & Mathematics Access to Retain Talent Grant (National SMART Grant), are scholastic merit awards for Pell recipients.
grants, like the Teacher Education Assistance for College and Higher Education (TEACH), provide funds to
recipients who pursue a degree in social work, medicine, education, or another field of public service.
Financial need is not a stipulation for a TEACH grant; instead, the recipient agrees to give high-
priority instruction at low-income or otherwise depressed schools for a period of four years. Failure to
fulfill the obligation results in the TEACH grant being converted into a Federal Direct Unsubsidized
Stafford Loan, which must be paid back with interest. Similar special-purpose grants carry similar
obligations and consequences.
Scholarships are bestowed by schools, foundations, corporations, and private endowments. Typically, a scholarship award is based on academic achievement, athletic ability, personal merit, group association, individual philanthropy, or community recognition. Like grants, scholarships are gifts, but the awards may have stipulations attached, like community service or maintaining a minimum grade point average. Scholarship award money comes in as many different amounts as there are scholarships.
Winning a scholarship implies belonging to an exclusive club of outstanding individuals, but there is really no limit to the categories of scholarships, and thousands are available. Some scholarships have a relatively low threshold for approval, requiring only an essay or modest academic merit from the applicant. A few scholarships remain open each year because no one applied, because the award is too small, or due to perceived obstacles to qualify. Competition for high-caliber scholarships is intense, so dedicated effort and a properly submitted application make a difference.
The coveted “full-ride” scholarship pays the entire tuition for a student plus dormitory fees, textbooks, and some expenses. These awards are usually obtained by students with exceptional athletic abilities or academic skills. Partial scholarships awarded to ordinary candidates may not cover a distance learning program from start to finish, but the money provided significantly reduces the cost of education. Success in paying for all or part of an undergraduate degree with scholarship funds usually means getting several scholarships at once. Seeking out scholarships takes time and effort, but the financial rewards equal days or weeks spent working at a minimum-wage, part-time job.
The first challenge for someone who wants a scholarship is the search. Selecting the scholarships appropriate to the skills and aptitudes of the potential recipient means not wasting energy on improbable goals. For instance, a person who has little knowledge or interest in history should reconsider a scholarship based on that subject. Plenty of good scholarships based on general qualifications need only sincere applicants for review and approval. The most important thing to do when applying is to read the rules and instructions carefully, answer all questions, and submit accurate personal information.
Students who belong to a particular religion, community, or ethnicity can find scholarships set aside for those reasons. Other scholarships are awarded for successful group membership, like the Eagle Scouts, or for volunteer civic activities, like the Bonner Scholarship. Unless a scholarship is tied to a certain college or kind of college—Knights of Columbus scholarships, for example, go only to students attending Catholic institutions—then distance learning students have the same eligibility as students at a campus college. A few independent distance learning programs—as opposed to programs linked to campus locations— have self-administered scholarship awards. To shop scholarships of all kinds, visit some Web sites that list various awards and explain how to get them. The College Board, scholarships.com, collegeanswers.com, and many other Web sites offer free scholarship searches. (Just remember that some of these sites are sponsored by online distance learning programs.)
The integral cost savings for distance learning
programs stretch scholarship funds by cutting out expenses associated with college attendance, like dorm
room fees or travel expenditures.
The method of choice to fund distance learning, and the one that causes the most anxiety, is student loans. When college-level online programs started gaining popularity during the 1990s, federal student loans for such a new and unproven distance learning system found little approval among academics and government loan agencies. Over the years, worthy online educational programs were gradually approved for student loans. When online degrees became respectable, abuse of federal loan programs became inevitable. Not all distance learning outfits that qualify for federal loans are a good investment. Investigate online programs carefully before borrowing money to pay for one. As with grants and other financial assistance, loan candidates should begin the process by completing a Free Application for Federal Student Aid (FAFSA).
- Stafford Loans, which are the easiest to get and carry low interest rates, distribute more federal student loan assistance than any other source.
- Stafford Loans come as subsidized, unsubsidized, or both. Subsidized loan payments do not charge interest as long as the student is enrolled and active in a college program. Interest on the loan does not start until six months after graduation.
- With low interest rates and 10 years to repay, Stafford Loans are by far the best way to borrow money for school. One drawback for some candidates is that subsidized loans are intended only for low-income candidates.
For extreme cases of financial difficulty, there is the Perkins Loan, which is administered directly through a college or online distance learning institution. Fewer applicants qualify for these loans than for the more conventional Stafford Loan or for other types of federal student aid. Candidates for Perkins Loans need to apply for assistance upon entering a higher-education program, because these loans have limited availability.
Unsubsidized Stafford Loans charge interest for the entire loan amount, but these loans are still more common than subsidized loans. To make unsubsidized loans more affordable while pursuing a degree, many recipients opt to set aside the accumulated interest until after graduation and the six-month grace period that follows. Most federal student loans are deferred while students are enrolled at least half time for a full-semester course load. If a student quits school or drops below half time, the payments kick in after six to nine months, depending on the type of loan.
If an unforeseen financial crisis prevents a loan recipient from making payments on the debt, there is relief under such circumstances. Forbearance programs allow debtors a temporary respite from full payments to work out their money problems without defaulting on the loan. Payments only on the loan interest, or reduced payments over a short term, help out distressed student loan recipients under forbearance. Deferment on loan debt can be anything from temporary suspension of payments to permanent cancellation of the loan.
The ordinary reason that student loans are deferred is due to a recipient going back for more education. Entry into a graduate program, a medical internship, or an extended training course defers loan payments until the requisite program is complete. Teachers who agree to serve in high-need schools, military inductees, or anyone who joins a public service agency like the Peace Corps are eligible, in most situations, to have federal student loans deferred. Work with certain non-profit organizations also qualifies for deferments.
Job loss or underemployment means contacting the lender and requesting a deferment while out of work. If deferred for unemployment, expect to reapply again in six months and be able to prove that attempts have been made to get work during the deferment period. Disability, medical necessity, or pregnancy defers loans while the condition exists. If a disability proves permanent, then the loan can be voided entirely.
When all other resources are
exhausted, paying for distance learning may come down to taking out a private loan. Because the loan
interest will likely be higher and the personal risk greater, now is the time to look for bargains not
only for loan guarantees, but for distance learning programs, too. Evaluate educational needs and
necessities wisely and choose the best option that keeps debt to a minimum. What’s the point of earning a
degree to get a better career and make more money if all the effort goes to paying off student loans?