First, let's look at the traditional methods of paying for higher education tuition and expenses, if you don't have the money in hand to cover all your costs.
Borrowing the money to pay for tuition is a common route, and there are many options available in student loans. Federal loans usually provide the best interest rates, and federal loan programs such as Stafford and Grad PLUS loans are the workhorses of the student loan industry. Students must complete a process known as the Free Application for Federal Student Aid, or FAFSA, to determine their eligibility for these loans [source: Federal Student Aid].
Some schools may also offer campus-based loans, which are often funded through the Federal Perkins Loan program or through institutional funds, such as endowments, that they make available to their students [source: MBA.com].
Private lenders also offer student loans, often at a higher or variable interest rate compared with federal loans. However, unlike most federal loans, which are based on need, private loans are granted based on a student's credit worthiness. They may cost more over time compared with federal loans [source: MBA.com].
Grants are funds directed toward students that do not have to be repaid. Grants are given out primarily on a need basis, and can come from the federal or state government, colleges and universities, and public and private organizations.
Many grants target particular types of students or students studying in particular fields. There are grants targeting underrepresented ethnic minorities, women, non-traditional students, low-income or disadvantaged students, members of the United States military, and people studying in high-needs professions [source: College Scholarships.org].
Scholarships are also free money, but they tend to be merit-based. Scholarships are offered to students based on academic or athletic performance, to winners of essay competitions, or people who have demonstrated achievement in a particular field or a personal accomplishment [source: College Scholarships.org].
The Federal Work-Study program provides funds to schools to help finance the cost of part-time jobs for students within the university or college. These jobs are primarily based on financial need [source: U.S. Department of Education].