There are three basic types of financial aid available to college students.
FREE MONEY: Scholarships & Grants
While you have to meet certain requirements to receive grants and scholarships, you do not have to pay them back.
Grants are usually need-based aid, while scholarships are usually merit-based. Eligibility for need-based grants is determined by your family’s ability to pay for college. Merit-based scholarships are awarded based on particular talents or achievements.
Grants and scholarships can come from government sources or from private sources. By filing the FAFSA and following up with the Iowa Financial Aid Application, you apply for federal and state grants and scholarships . To find private scholarships, start with your school counselor and your college financial aid office. More tips for finding private scholarships.
Download our free “Scholarships & Grants” brochure
EARNED MONEY: Federal Work-Study
Federal Work-Study allows you to earn money in a job that relates to your course of study or fills a community need. Work-Study is administered by your college, and jobs are usually available both on- and off-campus.
The FAFSA serves as the application for Federal Work-Study. If you qualify for Work-Study, you will be responsible for landing a job, based on referrals from your financial aid office.
Learn more about Federal Work-Study
BORROWED MONEY: Federal & Private Loans
Once possibilities for grants, scholarships and Federal Work-Study are exhausted, many students still find they need to take out loans to cover the cost of college. The important thing is to be smart about how and what you borrow.
First choice: Federal (Stafford) subsidized loans—These loans will not accrue interest or come due until six months after you leave school. You must file the FAFSA.
Second choice: Federal (Stafford) unsubsidized loans—These loans will not come due until six months after you leave school, but they will accrue interest. You must file the FAFSA.
Parents’ option: PLUS loans—These loans are available to parents of dependent undergraduate students. Repayment begins immediately, although you can request postponement. You must file the FAFSA, then your parents must apply for a PLUS loan.
Last resort: Private loans—These loans are often more selective and more expensive than federal loans.
No matter what … borrow as little as possible. You do not have to borrow the full amount you qualify for. Think of this amount as a credit limit, and try to stay under it if you can.
Download our free “Student Loans” brochure
Learn more about financial aid on our website.