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Article Series: Online Degrees
Is An Online
Degree Program For Me?
Is
Financial Aid Possible for Online Degrees?
One of the major myths of online education
is that it’s impossible to find any sort of student loans or
financial aid. Fortunately, this is not the case for those
who are willing to look for it. In fact, financial
aid is getting easier to find day by day for online students. No longer do
you have to sit back and wonder if you’ll be able to make ends
meet while paying for your education – just like other forms
of post-secondary education you can still get loans. The most
common form of financial assistance is that of student loans,
and student loans are what this article will deal with.
First thing first – does
it make sense to pay the extra money and get a student
loan? Well, according to statistics from
the U.S. Census Bureau those with a master’s degree earn an
average of $55 300 a year, while those who only have a bachelor’s
degree earn around $46 300. In ten years, that is almost a
difference of $100 000. For a twenty-five year career you would
make $225 000 more than the average person with a bachelor’s
degree. It doesn’t take a mathematics genius to figure out
that although you may spend $18 000 more for the loans to get
a master’s degree, the $225 000 difference more than justifies
it.
Are
all student loans created equal? Of course they aren’t.
Just like some restaurants will provide you food that’s better
for you, some student loans will provide money that’s better
for you. The first type of student loan – and best type – is
the government-backed Stafford student loan. Generally speaking
these loans carry the lowest interest rate, meaning that you
won’t drop off into debt. A few years ago the Stafford student
loans had an unbelievably low interest rate of 3.42%, which
is almost unheard of. It’s so rare in fact that this was the
lowest interest rate in the past two decades, making Stafford
student loans one of the best options there is. Unfortunately
not all online programs participate in this program, which
means you will have to do some research, to make sure that
the program you want to get into does in fact allow for this
type of funding.
The other type of student loan would be that of the private
student loan. These are available through various finance companies,
and while they will pay for your school, there are two very
big drawbacks. The first one is that they generally carry a
much higher interest rate. This interest rate can vary between
four and twelve percent, which is a whopping increase over
the government based student loans. There are also various
hidden fees that you may have to worry about, which could work
to increase rates, further hurting your chances to pay back
the loan. The second major draw back is the fact that you will
need to pass a credit check. If you have bad credit you’re
interest rates are going to be much higher than if you have
good credit.
This can be a huge
drawback for anyone that doesn’t have perfect
credit, as it may work to put them further in the hole than
they already are. There is one major advantage that private
student loans have over their government counterparts. What’s
that advantage? Well, that advantage would be the fact that
they can loan you more money that the government student loan.
This comes in handy if you have to pay a large amount for whatever
it is you want to do. However, you have to decide if the higher
interest is going to be too much for you to afford – remember
the more money you take out on a loan, the more the interest
is going to affect you.
In the end it’s up to you to decide which type of loan you
believe will best suit you. Some people believe that they need
the private loan to pay for their education, and are willing
to take the chances with the higher interest rate. Others use
the government loans, which have a lower interest rate and
are less likely to send you spiraling into debt, but which
may not provide you with all of the money you need. The choice
is yours. # # # # #
SolveYourProblem.com
: 2007
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