Student Loans? Cash-Crunched Students Get Creative to Attend College
With annual college costs averaging $15,605 for a four-year school, cash-crunched students are using traditional funding – grants, scholarships and student loans – for school, but they are getting creative too. One way cash-strapped kids are avoiding excessive student debt is by betting on their future success. Through companies like Pave and Upstart, students can kick start their way to college by pledging a percentage of their future earnings to investors. One 28-year-old architect from Seattle will repay 7% of his projected annual salary to investors for 10 years if he raises the $30,000 price tag he needs for school.
States are trying to help too. Oregon is working on a creative college financing program called “pay it forward, pay it back.” The initial proposal, which will require $9 billion of seed money, offers students interest free loans to go to state schools, in exchange for 3% of students’ annual earnings for 20 years. The state is still working out the details, but it hopes to launch a pilot program in 2015.
Other options for students include getting tuition-free college credit in high school; volunteering for nonprofits like AmeriCorps and Habitat for Humanity; starting their own companies to begin earning early; cutting costs on textbooks and living expenses; and starting out at less costly community colleges while selecting a major.
Please see the infographic for a full list of sources.