Why Investing in Your Education is Worth the Cost: A Guide to Everfi Financing Higher Education

The Cost of Higher Education

Cost of higher education

The cost of higher education has been a hot topic for years, and it's easy to see why. The cost of education has skyrocketed in recent years, making it difficult for many students to pursue their dreams of obtaining a college degree. The National Center for Education Statistics reports that from the 2006-2007 school year to the 2016-2017 school year, the average cost of tuition, room, and board at public institutions rose from $14,640 to $24,690. This is an increase of more than 68% over the course of just ten years. The cost of education at private institutions is even higher. The average cost of tuition, room, and board at private institutions was $49,320 in the 2016-2017 school year, up from $34,440 a decade earlier. This is an increase of more than 43%.

These exorbitant costs have led to many students taking on significant amounts of debt to fund their education. The average student loan borrower graduates with more than $30,000 in debt, according to the Institute for College Access and Success. This can have long-term ramifications, making it difficult for graduates to buy homes, start businesses, or save for retirement. In addition, it can take years, if not decades, for graduates to pay off their loans, which can place a significant strain on their financial well-being.

There are many factors that contribute to the rising cost of education. One key driver is the reduced funding that public institutions receive from the government. As state and federal governments cut funding for education, public institutions are forced to raise tuition to make up the difference. Another factor is the increasing demand for higher education. As more people seek to obtain a college degree, institutions are able to charge more for their services. The rising cost of facilities, faculty salaries, and student services also contributes to the increased cost of education.

Many students and families are left wondering how they will be able to afford the cost of a college education. One option is to carefully research and compare the costs of different institutions. Students may find that a less expensive school or a community college can provide the same quality of education at a lower cost. Scholarships, grants, and work-study programs can also help to offset the cost of education. Finally, some students may choose to take a gap year or work for a few years before attending college in order to save money and avoid taking on significant debt.

Despite the challenges of financing higher education, it is essential to remember the value of obtaining a college degree. A college education can lead to higher earnings and better job opportunities over the course of a lifetime. It can also provide a foundation for personal growth and lifelong learning. By carefully considering the costs and benefits of higher education, students and families can make informed decisions about how to finance their future.

Types of Financial Aid Available

financial aid image

Financing higher education can be a daunting task, especially without enough funds. That's where financial aid comes in. By filling out the Free Application for Federal Student Aid (FAFSA), students can unlock financial aid opportunities. The types of financial aid available can be broken down into three categories: scholarships and grants, loans, and work-study programs.

Scholarships and Grants

Scholarships and grants are the most sought-after form of financial aid as they do not have to be paid back. Scholarships are usually awarded based on academic, athletic, or artistic merit, while grants are awarded based on financial need. Both types of financial aid are given out by schools, states, and the federal government.

Merit-based scholarships can cover a range of expenses, such as tuition, books, and room and board. The requirements for scholarships vary and can range from maintaining a certain grade point average (GPA) to participating in a particular extracurricular activity or writing an essay. It is important to research and apply for as many scholarships as possible to increase the chance of receiving aid.

Some popular scholarships include the Pell Grant, which provides need-based aid, the Federal Supplemental Educational Opportunity Grant (FSEOG), and the TEACH Grant, which offers aid to students who plan to become teachers in low-income areas. The Gates Scholarship and Coca Cola Scholarship are also popular scholarships.


When scholarships and grants aren't enough to cover the cost of higher education, students can turn to loans. Unlike scholarships and grants, loans need to be repaid with interest. There are two types of loans: federal loans and private loans.

Federal loans typically have lower interest rates and more flexible repayment terms than private loans. The most common types of federal loans include Direct Subsidized Loans, Direct Unsubsidized Loans, and Direct PLUS Loans. Direct Subsidized Loans are available to undergraduate students who demonstrate financial need, while Direct Unsubsidized Loans are available to undergraduate and graduate students. Direct PLUS Loans are available to graduate students or parents of dependent undergraduate students.

Private loans, on the other hand, are offered by private banks and have higher interest rates than federal loans. They also typically require a credit check and may require a co-signer. It is important to exhaust all federal loan options before considering private loans.

Work-Study Programs

Work-study programs are a form of financial aid where students work part-time jobs to earn money to pay for education expenses. Jobs can be on or off campus and can vary from tutoring to clerical work. The money earned from work-study goes towards tuition, fees, room, and board or other education expenses. Work-study programs are often need-based, meaning they are only available to students who demonstrate financial need.

Participating in a work-study program can provide students with valuable work experience and skills that can help them in their future careers. It is important to note that work-study programs have a limited amount of funds, so it is important to apply early and consider other financial aid options.

In conclusion, financing higher education can be difficult without financial aid. Scholarships and grants, loans, and work-study programs are all available to help students pay for their education. It is important to research and apply for as much aid as possible to alleviate the financial burden of higher education.

How to Apply for Financial Aid

Apply for Financial Aid

Financing higher education is no small feat. With ever-increasing tuition fees and living expenses, college expenses can quickly add up. Therefore, seeking financial assistance to help pay for college is becoming more common today. Financial aid can come in different forms, such as grants, scholarships, and loans. However, to receive these forms of financial assistance, you must fill out the financial aid application form, also known as the FAFSA (Free Application for Federal Student Aid), which is used to determine your eligibility for financial aid.

So, how do you apply for financial aid and fill out the FAFSA form? Here are a few tips to get you started:

1. Start Early!

The earlier you start the application process, the better. The FAFSA application process opens on October 1st every year, and it's best to apply as soon as possible to increase your chances of receiving financial aid. You need to gather all the necessary information to complete the FAFSA form, such as your social security number, federal tax returns, W-2 forms, and bank statements. Starting early will give you ample time to collect all these documents and prevent last-minute rush or missing deadlines.

2. Fill out the FAFSA online

The FAFSA form can be completed online or in paper format. It's wiser to fill out the form online since it saves you time and provides instant access to the information you need to complete your application. The online application also has resources to guide you through the process and checks for errors on your form. It's also easier to make corrections on the form when you fill it out online, so you don't have to worry about the additional time and cost of mailing a paper form.

3. Seek Help When Needed

Seek Help When Needed

Filling out the FAFSA form can be overwhelming, especially if you're doing it for the first time. But, you don't have to go through the process alone. There are several resources available to help you fill out the form accurately. You can contact the Federal Student Aid Information Center at 1-800-433-3243 or reach out to your school's financial aid department for guidance.

You can also seek advice from college financial aid advisors or organizations that help students apply for financial aid. These resources can provide you with step-by-step instructions, answer your questions, or may even help you fill out the application form.

4. Be Accurate and Honest

When applying for financial aid, it's important to be accurate and honest when filling out the form. Any inaccuracies or misleading information on your form can lead to a rejection of your application or a reduction in the amount of financial aid you receive. Double-check your application for errors and inconsistencies, and make necessary corrections before submitting the form.

5. Make the FAFSA Renewal a Habit

It's not a one-time application process, as you will need to apply for financial aid every year you plan to attend college. Therefore, make it a habit to renew your FAFSA application annually. You can use the previous year's FAFSA form as a reference and update any information that has changed. Renovating your FAFSA annually ensures that you continue to receive financial aid and that you don't miss out on any available assistance.

Creating and following a step-by-step plan can help make the financial aid application process less daunting. By following these tips, you can increase your chances of obtaining financial assistance to fund your higher education, and this can help ease the burden of college and lead to a brighter future.

Understanding Student Loans

Understanding Student Loans

One of the most common ways to finance higher education is through student loans. These are loans specifically designed to cover the cost of tuition and living expenses while a student is in school. While student loans can be a great way to finance education and invest in one's future, they can also be complex and overwhelming. So, it is essential to understand the basics of student loans before taking them on.

There are two types of student loans: federal and private. Federal loans are offered by the government, while private loans are offered by banks, credit unions or other lenders. Both types of loans have their own set of terms and conditions, and each borrower needs to evaluate which type of loan is best for their specific situation.

Federal student loans often come with lower interest rates and more flexible terms than private loans. They also offer several repayment options such as income-driven repayment plans, which allow borrowers to pay back their loans as a percentage of their income. On the other hand, private student loans may offer higher interest rates and less flexible repayment terms. However, they can be a good option for students who have maxed out their federal loan options or need additional funds beyond what is offered through federal loans.

The next thing to understand about student loans is how interest rates work. Interest rates are the cost of borrowing money and are usually expressed as a percentage of the total loan amount. The rate of interest charged will depend on the type of loan and the borrower's creditworthiness. Federal student loans have a fixed interest rate, which means the rate will not change throughout the life of the loan. Private student loans, however, may have a fixed or variable interest rate. Variable interest rates are tied to a benchmark index and can fluctuate over time, resulting in changes to the loan's overall cost and monthly payments.

Another important factor to consider when taking out student loans is the loan repayment process. Federal loans typically come with a grace period, which is the period after graduation or leaving school when borrowers are not required to make payments. Private loans may or may not offer a grace period, depending on the lender's policies. In general, borrowers will have to start repaying their loans within six months of leaving school. It is crucial to set up a repayment plan that works best for the borrower's budget and financial situation.

Understanding student loans is vital for any student looking to finance their higher education. Federal and private loans both have their benefits and drawbacks, and it is important to carefully consider the terms and conditions of each loan before agreeing to it. It is also crucial to have a plan for repaying loans to avoid any negative consequences such as missed payments, default, and damage to credit scores.

Managing Student Loan Debt

Student Loan Debt Management

Financing higher education can be expensive, and many students turn to student loans to help pay for their education. While student loans can be helpful, they can also lead to a significant amount of debt after graduation. In fact, the average student loan debt for graduates in the United States is over $32,000. To help manage this debt, students need to understand their loan options, develop a repayment plan, and prioritize their finances.

Understanding Loan Options

Understanding Loan Options

Before taking out a student loan, it's important to understand the different loan options available. Federal loans are loans provided by the government with fixed interest rates and flexible repayment plans. Private loans, on the other hand, are loans provided by private lenders and generally have higher interest rates and less flexible repayment options. It's important to consider both types of loans and their terms before making a decision on which one to take out.

Developing a Repayment Plan

Repayment Plan for Student Loans

Once a student has taken out a loan, it's important to develop a repayment plan. This plan should include what type of loan it is and the terms of the loan, the interest rate, the length of the repayment period, and the monthly payment amount. There are several repayment options available, including standard repayment, extended repayment, income-driven repayment, and graduated repayment. Each plan has its own advantages and disadvantages, so it's important to research and choose the one that works best for the individual's financial situation.

Setting Financial Priorities

Setting Financial Priorities

Managing student loan debt requires setting financial priorities. Students should prioritize their loan payments over other expenses, such as entertainment or travel. They should also focus on building an emergency fund to cover unexpected expenses, such as car repairs or medical bills. Finally, they should consider alternative income streams, such as freelancing or part-time jobs, to supplement their regular income and help pay off their loans faster.

Refinancing and Consolidating Loans

Loan Refinancing and Consolidation

Refinancing and consolidating student loans can be a smart financial move for those looking to manage their debt. Refinancing involves taking out a new loan with lower interest rates and using it to pay off existing loans. Consolidation involves combining multiple loans into a single loan with a new interest rate and a new repayment plan. Both options can help lower monthly payments and make it easier to manage student loan debt.

Seeking Professional Help

Professional Help for Student Loan Debt

If managing student loan debt becomes overwhelming, it's important to seek professional help. There are several resources available, including loan counselors and financial advisors, who can help develop a repayment plan and offer guidance on managing debt. Students should also consider contacting their loan servicer for assistance and advice on managing their debt.

Overall, managing student loan debt requires understanding loan options, developing a repayment plan, setting financial priorities, refinancing and consolidating loans, and seeking professional help when needed. With careful planning and a focus on managing debt, students can successfully pay off their loans and achieve financial stability.

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