how to pay for graduate school

Obtaining a higher education is expensive. If you decide to attend graduate school after receiving your bachelor's degree, you are looking at two to four years (maybe more) of additional expenses. Thankfully, you have several options to help you pay for graduate school.

Gift Aid
When searching for ways to fund graduate school, you should first look into gift aid because, in most cases, you do not have to pay this money back. Be sure to submit the Federal Application for Federal Student Aid (FAFSA) after October 1st of the year prior to your grad school start date in order to be eligible for certain gift aid offered by the school, state, or federal government. Sources of gift aid for graduate school include:

• Scholarships. Scholarships are based on various criteria, such as merit, financial need, chosen field, etc. Scholarships are offered through colleges, the community, and other organizations. Use these methods to find scholarship opportunities to help with your grad school expenses.
• Grants. Grants are awarded by the federal or state governments or by the school and are usually based on financial need.
• Fellowships. Similar to scholarships, fellowships are usually based on a combination of merit and need. Fellowships are usually tied to a particular academic program or institution. Some fellowships include a tuition waiver or a payment to the university in lieu of tuition. Most fellowships include a small stipend to cover living expenses. While most fellowships do not have to be repaid, they may be taxable and reportable to the Internal Revenue Service. To find fellowship opportunities, check directly with your school or contact organizations that promote research or advanced study in your specific field.

Assistantships
Assistantships are available at many schools with graduate programs and are usually teaching or research centered. With assistantships, in exchange for completing some work or research for the school, you're offered free or reduced tuition, as well as other possible benefits, such as health insurance and a monthly stipend. The type of work, number of hours required, and amount of money received will vary from school to school. Each college or university administers its own assistantship programs, so check with your school to see what types of assistantships are available.

Employer Tuition Reimbursement
If you have a full-time job and are looking to obtain a graduate degree, you should find out if your employer offers a tuition reimbursement program. Tuition reimbursement is a contractual arrangement between employer and employee that outlines specific terms under which the employer may pay for the employee's continuing education. Tuition reimbursement benefits vary greatly from company to company. Many companies provide up to 100% reimbursement for college programs that directly enhance your job skills, and you generally don't have to pay reimbursement money back unless you violate the terms of the agreement. For instance, if the tuition reimbursement agreement requires a certain GPA, you may be responsible for repaying the money if you don't earn the required grade. Check with your employer to find out about tuition reimbursement availability, restrictions, and amount of funds provided.

Tuition Waivers
Depending on your specific circumstances, you may be eligible to receive a tuition waiver from your school. A tuition waiver is a type of financial award where a school reduces its tuition to make it more affordable for you. Tuition waivers vary by school and state. Some waivers are given to those who have served in the Peace Corps or military. Some schools offer waivers to resident assistants or minority students. Some waivers are given to alumni or children of school employees. Check directly with your school or with your state's Department of Education for more information about available tuition waivers for graduate students.

Work-Study Program
The work-study program provides part-time employment to undergraduates and graduates to help with college expenses. There are two different kinds of work-study: Federal Work-Study and non-Federal Work-Study. Federal Work-Study (FWS) is a form of financial aid awarded to students who demonstrate financial need and meet certain eligibility requirements. You must submit the Free Application for Federal Student Aid (FAFSA) (and possibly other financial aid documents required by your school) to determine your eligibility for FWS. Non-Federal Work-Study (non-FWS) is not based on financial need. If you do not qualify for Federal Work-Study, you should inquire about non-federal student employment opportunities at your school. Working on campus will give you more flexibility than working at an off-campus job because on-campus employers are usually more understanding of your class schedule and school work. The work-study program encourages employment in community service and in fields related to your major of study. Check with your school's financial aid office to find jobs in the work-study program.

Federal Student Loans
Federal student loans are available to graduate students to help pay for school costs including tuition, fees, books, supplies, or room and board. To apply for federal student loans, you must complete the Free Application for Federal Student Aid (FAFSA) after October 1st of the year prior to your grad school start date. As of July 1, 2012, subsidized loans are no longer available to graduate or professional students, but you still having several loan options including:

• Federal Perkins Loan. Federal Perkins loans are low-interest student loans awarded through participating institutions to undergraduate and graduate students who demonstrate exceptional financial need. The Perkins loan has a 5% fixed interest rate and no loan fee. As a graduate or professional student, you may be eligible to receive up to $8,000 per year. Not all schools participate in the Federal Perkins Loan Program, so contact your school's financial aid office to find out if your school offers this loan program.
• Federal Direct Unsubsidized Stafford Loan. Unsubsidized Stafford loans are not based on need or income. This option gives you access to federal guaranteed loans for college regardless of income level. Interest begins accruing from the day the loan is made. Interest rates for Unsubsidized Stafford loans fluctuate with the market but are capped at 9.5% for graduate students. View our federal student loan comparison chart for the current interest rate.
• Grad PLUS Loan. Grad PLUS loans are federal loans that are available specifically to graduate and professional students. They are meant to fill the gap between your financial aid package and the cost of education. Interest rates on Grad PLUS loans are market-based, so they will fluctuate from year to year. Rates for PLUS loans are capped at 10.5%. For the current year interest rate, view our federal student loan comparison chart.

Alternative or Private Loans
If you do not wish to take out federal student loans or you require funding in addition to federal student loans, you may want to take out an alternative or private loan. These alternative student loans often give you extra flexibility in choosing a school or taking advantage of a specialized course of study because you do not have to worry about federal forms or deadlines. Alternative student loans help fill in the gaps when other sources of aid have been depleted or when annual federal loan limits have been reached. Compared with federal loans, alternative loans may have higher upfront fees, higher interest rates, and fewer repayment options so you would be wise to consider these loans only after other aid options have been exhausted.

For more information about how to pay for graduate school, be sure to contact your school's financial aid office. For information about applying to graduate school, read Going Grad: Is Graduate School Right for You and Preparing for and Applying to Grad School.