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How are you going to pay for college?

That financial aid letter from your school of choice isn't the end. Keep looking.

By Donna_Freedman Apr 29, 2011 8:42AM
By now, high school seniors planning on postsecondary education have received their envelopes (whether thin or fat) and accepted financial aid packages.

Congratulations! But don't think you can quit looking for ways to pay for that sheepskin.

It's true that peak scholarship deadlines are spring and fall. But funding is still available, according to Mark Kantrowitz, publisher of the FinAid and Fastweb college aid websites.

One of his favorites is the Duck brand duct tape "Stuck at Prom" competition, which you can enter until June 13. The couple with the best prom costumes made out of duct tape will win $5,000 apiece. (Hint: Duct tape isn't just battleship gray these days. If you want to see some examples of previous years' duct couture, head over to the Stuck At Prom website.)
After the tumult of this year -- FAFSAs and portfolio-building and applications and maybe even campus visits -- you may be tempted to collapse with gratitude that it's finished. But it isn't. For starters, you may not even be reading the financial aid award letter correctly.

These missives are "often quite cryptic," according to Kantrowitz. "Even if the family figures out which awards are loans and which are grants, it isn't always clear that the financial aid award letter lists financial aid for just a single year."

Keep in mind that tuition and fees will almost certainly continue to rise over the next few years. Today's college freshman may wind up borrowing more heavily than he'd planned.

How much is too much? No more than $8,000 a year, according to Carol Stack and Ruth Vedvik, co-authors of "The Financial Aid Handbook: Getting the Education You Want for the Price You Can Afford."

Ideally, students would borrow a lot less. Deep debt "could ruin a decade of your life or more," the authors write. "Don't borrow a dime more than $32,000 to go to college."

Is there free money?

Concentrate on funding that doesn't need to be repaid. Fastweb is a great source of scholarship offers; it compiles and emails scholarship options based on your specific profile. (You'll need to get used to clicking on "no thank you," though, because you'll have to wade through ads and offers every time you sign on.) Cast as wide a net as possible by searching some other legitimate scholarship search sites too.

If you live near the college, visit its financial aid office at least once this summer and then at least once a month during the school year. Scholarship, grant and fellowship offers are posted on an irregular basis. Or not posted: There might not be room for all of them.

Specify that you want to see every local, regional and national opportunity. For example, I found out about a scholarship from the local Mensa chapter; you didn't have to be a Mensa member to apply (although I am, and I did win one). I also found out about and won a grant for "place-bound" students, i.e., those who have a specific need to go to college right where they are.

Read campus bulletin boards and e-newsletters, too. During my first quarter as a transfer student at the University of Washington, I happened to see the notice for a two-month summer fellowship. I applied and was accepted, which meant half a dozen credits that I didn't have to pay for plus a $2,000 stipend.

Would I have learned about the fellowship any other way? Probably not. Since I hadn't yet declared a major I wasn't attached to any particular department, adviser or mentor. It's worth noting that once you've taken part in a program like this, you'll be in a position to start hearing (or being notified) about other opportunities, such as research grants and international exchange programs.

Apply for anything that might possibly be a match. Even if it's a stretch, write the essay in a strongly positive way that explains why you are the best person to be getting this money. Yes, I said essay: They don't just hand out scholarships like lollipops. You have to convince a committee that you're worthy of the funds. Post continues after video.

A few other tips:

  • Fraternal organizations. Does a parent belong to a sorority or fraternal organization? These groups may offer funding.
  • A parent's employer -- or yours -- may provide scholarships. Ask.
  • The alumni association of your chosen school might give out money. Hunt down any local or regional alumni groups. My daughter won a grant from the Alaska chapter of her university's alumni group. She found out about this only two days before the deadline and had to rush to get the application form, have a teacher recommend her and write an essay. It paid off: Less than a week before high school graduation she found out she'd earned a $1,000 scholarship.
  • Focus on your field. Sometimes professional groups -- law, social work, medicine, teaching -- offer scholarships. Ditto special interest clubs. For example, I saw a fabric art scholarship offered by a local quilting guild, and a grant offered by a welders union for those who wanted to take welding classes at the community college.
  • Use education tax benefits. Kantrowitz says that families may overlook the Hope Scholarship and Lifetime Learning tax credits as well as the tuition and fees deduction. There's also a student loan interest deduction, which can be claimed even if you don't itemize.
  • Work a part-time job while in school. It is possible. People do it all the time and still manage to keep their grades up and have the vaunted "college experience."

Sound like a lot of work? It is. You know what else is a lot of work? Paying back tens of thousands of dollars in debt, especially if you can't find a good job immediately after graduation.

Zac Bissonnette, author of "Debt-Free U," interviewed a young woman with $45,000 in loans. The only job she could get after graduating was managing a doughnut shop.

"It wasn't taking her anywhere near the field she wanted to be," he says, but heavy debt meant that "she didn't have the luxury of choice."

"Student loans will have a dramatic impact on your quality of life. You should not sign up for them until you've done everything you can to avoid them."

MSN Money columnist Donna Freedman blogs at Smart Spending and Surviving and Thriving.

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