Financial Aid For Psychology School
How to get financial aid so you can pursue your psychology degree.
It’s always exciting to embark on a new career, but there are a few things to keep in mind before you get started on your studies.
For most of us, financial aid is a big consideration as scholarships and grants can bring down the total cost of your education, and you can find student loans to cover the rest. You’ll find information on financial aid below.
And then there are other things that you’ll want to think about to get ready for school: which specific field of study is right for you, the benefits of visiting schools, choosing the right school for you, and more.
But first, let’s take a look at all you need to know about financial aid.
A psychology career requires an ample amount of schooling, which can be expensive. If you’re concerned you won’t be able to pay for college or graduate school, consider this: About $150 billion in grants, loans, and work-study programs is awarded by the U.S. Department of Education each year.
To be considered for federal aid, psychology students should complete the Free Application for Federal Student Aid (FAFSA), which is the first step to eligibility. Here’s a round-up of the various financing options psychology students have.
Psychology Degree Loans
College loans are a common form of financial aid for psychology students and federally-backed loans carry a low interest rate. Because the government regulates these programs, there is a limit on how much interest a lender can charge.
Another plus is loan repayment doesn’t begin until six months after graduation (or when enrollment is less than half time). This gives students time to find a job and prepare a budget incorporating loan payments. In instances where a student is struggling to pay, they can apply for assistance in the form of deferment and forbearance.
The U.S. Department of Education operates two loan programs:
- The William D. Ford Federal Direct Loan Program
- The Federal Perkins Loan Program
Stafford Loans are the most common federal student loan available and fall under the Direct Loan Program. The funds are dispersed directly to students and are either subsidized or unsubsidized. What’s the difference?
- Subsidized loans are available to undergraduate students with financial need. The government pays the interest while the student is in school.
- Unsubsidized loans don’t require a student to have a financial need, but the responsibility of paying the interest, which starts accruing immediately, is on the borrower.
Federal loans have yearly dollar limits, but these can change and the Department of Education will have the most updated information.
Federal Perkins Loan
Undergraduate and graduate psychology students with “exceptional financial need” may be eligible for Perkins Loans. Unlike Stafford Loans, schools act as the lender which means funds can be limited. Another possibility is your school doesn’t participate in the program; check with the financial aid office to get details.
If you’ve tapped out your federal loan resources, but still need more money to pay for school, private loans can help. While they offer higher limits, interest begins to accrue as soon as the loan is dispersed.
In order to apply for private loans, psychology students still need to fill out the FAFSA. With a good credit score, you’ll have a better chance of getting approved as well as a lower interest rate. If your credit is spotty, private loans allow for a co-signer.
PLUS & GRAD PLUS Loans
PLUS Loans are loans for parents and graduate and professional degree students and paid through the Direct Loan programs. In order to qualify for this type of loan as an undergraduate, you must be a dependent student in school at least half time, and your parent has to apply for the loan.
These loans have an annual limit which is equal to your cost of school minus other financial assistance you receive. The first payment is due 60 days after the loan is distributed. Parents are subject to a small fee—usually less than 4 percent of the loan.
The GRAD PLUS Loan program allows eligible graduate and professional degree students to borrow under the PLUS Loan program. The same terms and conditions apply.
Psychology Loan Repayment Options
When you complete your degree program, you could find yourself with a lot of debt to pay back. There’s good news for those in a psychology career—loan repayment resources could be an option.
The National Health Services Corps (NHSC) provides loan repayment assistance up to $50,000 to licensed behavioral health providers in areas with limited health care access. Sounds pretty good, right? There are several requirements for the full-time program:
- Provider must be licensed in a NHSC-eligible discipline
- Work at an NHSC-approved site
- Have unpaid, qualifying school loans
The half-time program provides up to $25,000 in loan repayment assistance. The definition of what constitutes full- and half-time, as well as other requirements, can be found on the NHSC site.
Military Loan Repayment Assistance
The U.S. Army offers a loan repayment program specifically geared toward clinical and counseling psychologists. By joining the army, psychologists could receive up to $250,000 over a three-year period to pay for qualifying school loans.
The Air Force and Navy also offer loan repayment options for those in behavioral health field, but dollar amounts differ. The requirements for these programs include a minimum amount of active duty, satisfactory GPA, work experience, among other qualifications.
Psychology School Scholarships
Many students think of psychology scholarships as free money. Since this form of financial aid doesn’t need to be repaid, competition can be fierce, but applying for all the scholarships you qualify for may help reduce your overall tuition.
There are two kinds of scholarships. Merit-based scholarships are typically awarded for excellent academic performance and test scores, outstanding artistic talent, or phenomenal sports ability.
Others types of scholarships are awarded to good students who lack the financial means to go to college, to students of a particular gender, race or religion, to students who will be pursuing a particular course of study, and more.
For psychology students, the professional associations for your specialty may give scholarships to qualified individuals. For example, the American Psychology Association offers more than a dozen scholarships to psychology students. Military scholarships for psychology professions are also available. Other resources also include:
- Local organizations
- Private and public schools
- Small businesses
- Community groups
Grants are another great way to finance psychology school since they don’t have to be paid back. With over a thousand federal grant programs in the U.S., worth more than $400 billion, securing a psychology grant can help you save quite a bit of money.
The Federal Pell Grant, which will award up to $5,730 (per eligible student) in the 2014-15 school year, is offered to undergraduate students. Eligibility is based on financial need, cost of school and other factors.
While it’s worth the time and effort to apply for grants, many schools often automatically consider students for grants upon completion of the FAFSA and application to the school.
The American Psychology Association can also connect you with grant opportunities. Their site allows you to search for scholarships, grants and awards based on a variety of criteria.
Work Study Programs
If you’ll have the time to work while in school, work-study programs may be an option to help fund your education. This form of financial aid allows students to make money working on campus, in community-related jobs or assisting teachers. Work-study awards are usually based on a student’s financial need and the availability of funding at the school.
Students will earn at least the federal minimum wage, but higher pay isn’t uncommon. If you’re interested in work-study programs, you can indicate this preference on your FAFSA form.
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