Not long ago Congress required a school to conduct more than 50% of its teaching in a classroom setting to qualify for federal financial aid. This tactic, while designed to prevent “diploma mills” from raiding our federal coffers, affected many students who wanted to obtain a degree through legitimate online programs. In February 2006 the 50% requirement was lifted, freeing up aid for accredited online programs and putting online students on much more even footing with traditional students. As a result, financial aid is available to those who want to attend an online college.
Today the Federal government not only recognizes the validity of some 2,500 accredited online colleges and online degree programs, but also the needs of students enrolled in them. These students are often working adults, rural residents, or serving in the military, and many need help paying for school. Online colleges offer the needed flexibility for these adults.
You must also file a FAFSA, or Free Application for Federal Student Aid. You may need to fill out a school-specific financial aid application, as well. Whether you’re a classroom or an online student, though, most of your financial aid will likely come from the federal government in the form of grants, loans, and work-study programs. Watch our Financial Aid video for more information about the FAFSA and types of financial aid available.
Shawn Henderson, Associate Director of Financial Aid at William Peace University, cautions families against services that charge to fill-out and submit your FAFSA. “It’s called the ‘free application’ for a reason. Don’t pay for it. Assistance is available online and from your school,” he says.
There are several types of student aid. Grants and scholarships are considered “gift awards,” or money you don’t have to pay back. Many schools, such as Middle Tennessee State University, offer students resources for finding scholarships.
Government student loans offer lower interest rates than traditional banks. Those in the military may be eligible for special education benefits. A large portion of online learners are also employed full-time, and might be able to take advantage of employer-paid tuition programs.
Many online colleges are for-profit entities that compete for students, and tend to work hard at getting them financial aid. Capella University, for example, reports giving aid to 75% of its students. DeVry University is currently advertising $40 million in available scholarships and grants for its students, and University of Phoenix is offering “New Student Education Grants,” between $500 and $1,000 to help pay for a third class.
Once the online colleges have your FAFSA and other required information, each will provide you with a customized financial aid package. These packages will differ from school to school, so be sure to weigh all your options carefully. Consider the cost of the degree and any aid you’ll need to repay versus the how the degree can help your career along and increase your income. Chances are it will be a good investment.
By Margarita Barresi