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Loans are bad. Take this $5,000 grant and a money management course instead.
That’s the message at Syracuse University, where a new initiative called the Money Awareness Program is reducing debt by up to $21,000 for some students, CNN says. And it’s not the only school doing it…
Alvernia University, a Catholic liberal arts college in Pennsylvania where 86 percent of undergraduates have some type of loan averaging about $10,000, requires that all of its incoming students take an hour long financial management seminar.
An experimental program called Aid Like a Paycheck, being tested on low-income students at community colleges in California, Illinois and other states, parcels out student scholarship and grant money not in one or two lump sums each semester, but in smaller portions every two weeks in order to teach recipients to budget and manage their money better. It may be expanded to include loans.
Other schools are trying out programs, too – because the availability of student debt data is beginning to steer applicants away from colleges with high default rates. So if you’re applying soon, don’t be afraid to ask the school’s financial aid office: What can you do to keep me out of debt?