SoFi

While a graduate certificate program is typically not as long, intense, and expensive as a graduate degree, certificate programs can still be a significant commitment — both in terms of time and money. On top of tuition, there may be ongoing additional fees to consider, such as materials, exam fees, and professional association fees.

Not all certificate programs qualify for federal aid, although some may. Fortunately, there are other financial aid avenues that can potentially help you afford your graduate certificate. Here’s a look at some of your financing options, plus the pros and cons of each.

Finding Financial Aid for Graduate Certificate Programs

There are many reasons to pursue a graduate certificate, including access to more job opportunities and the ability to earn more money. In some fields, such as finance, employers may encourage their employees to obtain certificates to move up in their fields. In these cases, employers may provide financial assistance to pay for the certificate program.

Some people may obtain a graduate certificate with an eye toward completing additional coursework toward a master’s degree in the future. While some graduate certificates have discrete coursework unique to the certificate, other post-grad certificates have credits that may go toward a master’s degree. If you’re considering a grad degree, then it may be a good idea to explore what the coursework entails and whether you may be able to use those credits toward a master’s in the future.

If you’re planning on funding your graduate certificate yourself, it may be helpful to speak to people who have done the certification program to hear the pros, cons, and time commitment required. It can also be helpful to hear how other people have funded the certificate, because it could open up certain avenues, such as specific scholarships for that certificate that you may not have heard of yet.

Strategies to fund your graduate certificate include self-funding, funding from your employer, funding from scholarships, or a private student loan. Here, some of the considerations of all avenues.

Recommended: A Guide to Private Student Loans

Funding From Your Employer

In some cases, your employer may recommend you obtain a post-grad certificate. In other cases, you may need to ask your manager and go through your employer’s process for tuition reimbursement.

Pros of funding from your employer:

•   Your employer is covering some or all of the financial burden.

•   Your employer is invested in your career.

•   You can be confident that the certificate will be useful to your future career path.

•   There may be coworkers who have done the certificate as well as who can walk you through their experience as well as specifics about the HR process in getting the certificate funded.

Cons of funding from your employer:

•   Balancing work and studying may be challenging.

•   Your employer may have oversight into your success.

•   You may be on the hook for the costs of the certificate if you leave or are terminated during a set period of time.

•   You may still be responsible for part of the tuition, or for additional materials fees.

Free tuition is an obvious pro when it comes to having a certificate employer-funded. But other considerations come into play: How will you simultaneously manage work and classes plus studying? What happens if you don’t pass? And if you do accept employer funding, is there a contract that locks you into employment for a certain period of time? Knowing the stipulations can be helpful in managing expectations. And of course, talking to coworkers who have already done the program can be helpful in figuring out the ins and outs of how your specific employer expects you to complete the course and what they anticipate for your career future.

Funding From Scholarships

Private scholarships may be available to help pay for the course. They may be issued by the institution granting the certificate. For example, the Certified Financial Planner (CFP®) certificate, a popular financial certificate, has a host of scholarships shared on their website. These scholarships may be distributed by private foundations in honor or memory of certain people. Each scholarship may have specific requirements; some may be exclusive for people who demonstrate financial need, others may be exclusively focused on merit.

Pros of scholarships:

•   They can help offset tuition costs.

•   They can be gratifying to receive and provide motivation for success.

Cons of scholarships:

•   They typically require applications, which can be time-consuming to complete.

•   They may have admission requirements, such as being a U.S. citizen or already completing certain coursework.

•   Receiving the full amount of money may be contingent on performance.

•   You may be required to declare the scholarship on your taxes; scholarships for non-degree programs are generally considered taxable. If that’s the case for you, consider putting aside money for taxes on the scholarship.

Scholarships can be a great way to cover the cost of your certificate. It’s a good idea to research the certificate program you’re considering to uncover scholarship opportunities. Your alma mater’s career development office may also have leads for you to pursue.

Recommended: Finding & Applying to Scholarships for Grad School

Self-Funding a Certificate Program

Maybe you have savings set aside or maybe your family has offered to cover the cost of your degree program. But if you have the funds, should you write the check?

Pros of self-funding:

•   It’s a seamless process — write the check after you’ve been accepted, and you no longer need to worry about payment.

Cons of self-funding:

•   The money used for the degree program may diminish your savings or emergency fund.

•   Payment may come with strings if a family member is covering the program.

If you have the money to cover a certificate program and still have a comfortable emergency fund, then this can be a great option. But if you’d need to decimate your emergency fund or use a credit card to cover the payment, then it could be a good idea to consider other ways to cover the cost.

Student Loans for a Certificate Program

The fourth option is applying for student loans to cover the cost of a certificate program. Unlike a degree program, certificate programs are generally not eligible for federal student loans.

In the case that your certificate program is eligible for federal financial aid, it’s worth filling out the Free Application for Federal Student Aid (FAFSA®). This form will help determine your eligibility for federal aid, including federal student loans.

But private graduate student loans may be an option. Note that private student loans are not subject to the same requirements as federal student loans and don’t offer the same borrower protections, such as the option to pursue Public Service Loan Forgiveness or deferment protections. Be sure to shop around and read all the terms and conditions closely.

Pros of private student loans:

•   You won’t need to deplete your savings.

•   You can compare private loans to find the lowest interest rate.

•   You may be able to find a payback structure that makes sense within your overall budget.

Cons of private student loans:

•   Additional debt can be challenging to take on, especially if you’re not working.

•   Depending on your credit history, some lenders may require a cosigner.

How do you choose which company to get private student loans for a certificate program? In addition to checking your interest rate — which will typically not affect your credit score — you also may want to consider additional elements of the loan. Are there any additional fees? Are there any hardship clauses, if you were unable to make payments for a month? What does the payment structure look like?

In addition to comparing lenders, it can also be helpful to ask yourself some what-ifs. These include:

•   How will these payments fit into my budget?

•   What happens if I don’t obtain the job or payment bump I’m expecting along with my certificate?

•   How will I budget to make sure that my loan payment doesn’t feel like a liability?

Because graduate certificate programs are generally less expensive than degree programs, loan terms may be smaller and shorter-term. Still, applying for any loan is a big deal, and it’s good to go through a few scenarios before you decide on the right avenue for you.

The Takeaway

Even though they may seem like they are lower-commitment than a full degree program, certificate programs have the potential to be time-consuming and expensive. Resources are available for funding, but some expenses, such as professional fees or exam fees, may not be covered under certain scholarships or by your employer. Understanding the full scope of tuition costs, which kinds of loans your program qualifies for, and payback terms can be key for paying for your certificate program.

If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.

Cover up to 100% of school-certified costs including tuition, books, supplies, room and board, and transportation with a private student loan from SoFi.

FAQ

How can you pay for a graduate certificate program?

While federal student loans are often not available for graduate certificate programs, other ways to finance your studies are possible. These can include self-funding, funding from your employer, scholarships, and private student loans.

How much do graduate certificates cost?

Typically, a graduate certificate program can cost a few thousand dollars. Those from prestigious universities can cost in the range of $10,000-$15,000.

How long does it take to get a graduate certificate?

The length of time it takes to get a graduate certificate can vary tremendously depending on what path you pursue and whether the program is full- or part-time. The typical length of time is several months to a year when attending part-time, but that could stretch out longer. Also, certain highly specialized certificates can be achieved in a matter of a few months.

---

Photo credit: iStock/Jacob Ammentorp Lund

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student loans are not a substitute for federal loans, grants, and work-study programs. We encourage you to evaluate all your federal student aid options before you consider any private loans, including ours. Read our FAQs.

Terms and conditions apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. SoFi Private Student loans are subject to program terms and restrictions, such as completion of a loan application and self-certification form, verification of application information, the student's at least half-time enrollment in a degree program at a SoFi-participating school, and, if applicable, a co-signer. In addition, borrowers must be U.S. citizens or other eligible status, be residing in the U.S., Puerto Rico, U.S. Virgin Islands, or American Samoa, and must meet SoFi’s underwriting requirements, including verification of sufficient income to support your ability to repay. Minimum loan amount is $1,000. See SoFi.com/eligibility for more information. Lowest rates reserved for the most creditworthy borrowers. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change. This information is current as of 4/22/2025 and is subject to change. SoFi Private Student loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Third Party Trademarks: Certified Financial Planner Board of Standards Center for Financial Planning, Inc. owns and licenses the certification marks CFP®, CERTIFIED FINANCIAL PLANNER®

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

SOISL-Q325-137

Read more

Setting financial goals is one of the most important steps you can take toward building a secure and stress-free future. Without clear goals, it’s easy to spend impulsively, fall into debt, or miss out on opportunities to build wealth. Whether you’re saving for a vacation, trying to get ahead of debt, or preparing for retirement, a well-structured financial plan can help you stay focused and motivated.

What follows is an essential guide to financial goals — from understanding their importance to setting achievable milestones and adjusting your plan when life changes.

What Are Financial Goals and Why Are They Important?

Financial goals are specific money-related targets you set to guide your financial decisions. They give you direction and help you align your daily spending habits with long-term priorities. Instead of letting money just come and go from month to month, you create a roadmap that leads you toward stability, independence, and growth.

Goals are also important because they provide:

•   Clarity: They help you understand what you’re working toward.

•   Motivation: Defined goals encourage you to save instead of overspend.

•   Control: They prevent financial stress by giving you a sense of purpose.

•   A way to track progress: Goals let you measure how far you’ve come.

Without goals, money has a tendency to slip through the cracks. With them, you can make strategic decisions that improve your financial health step by step.

💡 Quick Tip: Want to save more, spend smarter? Let your bank manage the basics. It’s surprisingly easy, and secure, when you open an online bank account.

Types of Financial Goals: Short-, Mid-, and Long-Term

Financial goals depend on timeframes and priorities. Generally, they fall into three categories — short-, mid- and long-term goals.

Examples of Short-Term Financial Goals (1-3 Years)

Short-term goals are immediate priorities. They include the things you want to buy or do within the next few months or years, and help build momentum for bigger challenges. Examples include:

•   Building an emergency fund

•   Paying off a credit card balance

•   Saving for a vacation or holiday gifts

•   Creating a monthly budget and sticking to it

•   Setting aside money for a new laptop or phone

Examples of Mid-Term Financial Goals (3-10 Years)

Mid-term goals take more time and planning and act as a bridge between short-term wins and long-term security.

They often involve saving or investing for significant life milestones and might include:

•   Paying off significant debt (such as student loans)

•   Saving for a wedding or dream vacation

•   Saving for a down payment on a house

•   Funding a large-scale renovation

•   Growing an investment portfolio

Examples of Long-Term Financial Goals (10+ Years)

Long-term goals shape your financial future and often require consistent commitment. These goals can seem intimidating, but breaking them into smaller steps makes them achievable. Common long-term goals include:

•   Saving for retirement through 401(k)s, IRAs, or pensions

•   Paying off a mortgage completely

•   Funding your children’s college education

•   Achieving financial independence or early retirement

•   Building generational wealth through investments

Recommended: Savings Goals by Age

How to Set Financial Goals in 5 Steps

Now that you understand the different types of goals, here’s how to set them effectively:

Step 1: Understand Your Current Financial Health

Before setting goals, it’s important to have a clear picture of where you currently stand. You can do this by gathering the last several months of financial statements and then using them to determine:

•   Your average monthly income

•   Your average monthly spending

•   Current debt balances

•   Status of your emergency savings and retirement accounts

This assessment forms the foundation for realistic goal setting.

Step 2: Define What You Want to Achieve

Once you have a snapshot of your overall financial situation, it’s worth spending some time reflecting on your money goals: what is really important to you.

While there are many things people commonly save for, like a down payment on a house or retirement fund, your financial goals might not be the same as your sibling’s or your coworker’s.

Think about what you would like to accomplish in the next few years, in five or so years, as well as decades from now, and simply jot them down. Keep in mind that these goals aren’t set in stone — they can and likely will change over time.

Step 3: Make Your Goals S.M.A.R.T.

A vague goal like “save money” is hard to stick to. Instead, consider using the S.M.A.R.T. framework:

•   S for Specific: Be clear  about what you want to achieve, such as exactly what you want to save or how much you’ll need to pay off a debt.

•   M for Measurable: Assign real numbers to your goals. Measurable goals allow you to track your progress and monitor your success.

•   A for Achievable: Setting unrealistic expectations can lead to frustration and disappointment. Ensure your goals are realistic for your income and expenses.

•   R for Relevant: Make sure your goals align with your overall financial plan and your life priorities.

•   T for Time-based: Set a deadline (e.g., within 10 months) for each goal.

SMART goals help keep you accountable and focused.

Step 4: Create a Budget That Includes Your Goals

Your budget is the tool that makes your goals achievable. And thanks to Step 1, you already know your average monthly income and expenses. The next step is to decide if your current spending aligns with your goals, or if you need to rejigger your spending to free up more funds for saving.

There are many different types of budgets, but one popular framework is the 50/30/20 rule. This divides your take-home income into three categories:

•   50% for needs (housing, food, utilities)

•   30% for wants (entertainment, travel)

•   20% for savings and debt repayment

“Thinking about where to put your 20% savings each month can help you reach your goals,” says Brian Walsh, CFP® and Head of Advice & Planning at SoFi. “High-yield savings accounts, money market accounts, certificates of deposit, and cash management accounts are all vehicles that may pay more interest than a traditional savings account, helping your savings grow.”

Step 5: Track Your Progress and Stay Flexible

Once you’ve set some goals and established a budget, it’s a good idea to track your spending for a few months to make sure you are sticking to the plan.

You can track your spending with plain old pen and paper or a computer spreadsheet, but a simpler option is to put a budgeting app on your phone. Your bank may even offer a free tool that automatically tracks and categorizes your spending in real time.

If you find that your budget isn’t realistic, or your financial situation changes at some point, you may need to make some adjustments to your budget. That’s why it’s important to check in with your money regularly.

Common Financial Goal Examples

Here are some six popular financial goals you might include on your list:

1. Build an Emergency Fund

Whether you’re easily covering your monthly expenses or grabbing change from the bottom of your bag to buy a coffee, many people are living paycheck to paycheck. But what if that paycheck disappeared or if you had a large, unexpected expense? Enter the emergency fund.

Having an emergency fund can help you comfortably manage an unexpected medical bill, major car or home repair, or a sudden loss of income with having to run up high-interest debt.

A general rule of thumb is to have three to six months’ worth of living expenses set aside for emergencies. While that can be a sizable sum, keep in mind that you don’t have to build your back-up fund overnight. You might first set a short-term goal of saving a small cushion of $1,000, then build from there.

Recommended: Emergency Fund Calculator

2. Pay Down High-Interest Debt

High-interest credit card debt can feel like a treadmill: Despite constant effort, you never seem to get any closer to the finish line. By prioritizing repayment, however, you can make real progress. This will free up cash flow you can then redirect towards savings and investments.

Two popular payoff approaches are the debt avalanche (paying off the highest-interset debt first) and the debt snowball (paying off the smallest balance first to build momentum). Whichever you choose, the key is to consistently make extra payments and avoid new debt along the way.

3. Start Saving for Retirement

Most of us know we should be saving for retirement, but making it happen can be challenging when there are so many competing places to put our money. The good news is that even small contributions to a retirement account can grow to significant savings over time. This is largely due to the magic of compounding returns — when the returns you earn start earning returns on their own.

One rule of thumb is to save at least 15% of your pre-tax income each year, including any employer match. If that’s not feasible right now, try to contribute at least up to any employer match (otherwise you’re leaving free money on the table).

4. Save for a Down Payment on a House

For many people, owning a home is a major milestone and a symbol of financial stability. But buying a home often requires a significant down payment, typically ranging from 3% to 20% of the purchase price. Saving for this can feel overwhelming, but breaking it into smaller milestones makes the goal achievable.

Consider opening a dedicated high-yield savings account for your down payment fund so it remains separate from everyday spending. Or, if your bank offers savings vaults, you might create a sub-savings account within your main one earmarked for your down payment. Then automate contributions to this account or vault so it grows over time.

💡 Quick Tip: Most savings accounts only earn a fraction of a percentage in interest. Not at SoFi. Our high-yield savings account can help you make meaningful progress towards your financial goals.

5. Invest for the First Time

Investing allows your money to work for you, building wealth beyond what traditional savings accounts can provide. While investing might seem intimidating at first, starting small is often the best approach. Low-cost options like index funds, exchange-traded funds (EFTs), or robo-advisors make it easier than ever to get started without needing extensive financial knowledge. As your income grows, you can increase contributions and diversify your portfolio.

6. Pay Off Student Loans

Student loans are a reality for millions of people, and paying them off can take years. Carrying this debt affects your ability to save, invest, and even qualify for other financial opportunities like a mortgage. That’s why making a structured repayment plan is so important.

Start by reviewing your repayment options — federal loans may offer an income-driven repayment plan or refinancing opportunities. Making extra payments towards the principal when possible can reduce the overall interest you pay and shorten the repayment timeline.

Financial Goal Examples for Students

Students often juggle limited income with rising expenses, making financial goals essential. Here are some practical ones to consider:

•  Creating and sticking to a monthly budget

•  Building a small emergency fund (even $500 helps)

•  Paying off credit card balances in full each month

•  Saving for textbooks or tuition payments

•  Beginning to invest through a low-cost brokerage app

•  Applying for scholarships or part-time jobs to reduce student loan reliance

Setting goals early can help students avoid financial pitfalls and build healthy habits for adulthood.

How to Adjust Your Financial Goals if Your Circumstances Change

Life rarely goes exactly as planned. You might face job loss, medical expenses, or unexpected windfalls like a bonus or inheritance. When your circumstances shift, it’s important to:

•  Reevaluate your priorities: Decide which goals still matter most.

•  Adjust timelines: You may be able to shorten a deadline or you might need to extend one or more of your timelines.

•  Reallocate resources: If money is tight or your priorities change, you may want to shift money from one goal to another.

•  Stay flexible: Remember, goals are not fixed — they evolve with your life.

The Takeaway

Setting financial goals isn’t about perfection — it’s about progress. By understanding your current financial health, defining clear objectives, and using the SMART framework, you can create a roadmap toward stability and success.

Whether you’re saving for your first emergency fund, tackling debt, or planning for retirement, goals can give you the motivation and direction you need to take control of your financial future. The key is consistency. Start small, stay flexible, and remember that every step forward brings you closer to your near- and long-term aspirations.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with eligible direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.

Better banking is here with SoFi, NerdWallet’s 2024 winner for Best Checking Account Overall.* Enjoy 3.30% APY on SoFi Checking and Savings with eligible direct deposit.

FAQ

Is it wise to invest your emergency fund?

Generally, it’s not wise to invest your emergency fund in risky assets like stocks or mutual funds. An emergency fund should remain easily accessible and safe, since its purpose is to cover unexpected expenses or a sudden loss of income. Keeping it in a high-yield savings account or money market account balances safety with some interest growth. Once your emergency fund is secure, you can focus on investing other money for long-term goals.

What is the most important financial goal?

For many people, the most important financial goal is to build a strong foundation of financial security. This typically means creating a healthy emergency fund and paying down high-interest debt. Without stability, it’s difficult to make progress toward other goals like saving for retirement, buying a home, or investing.

Once your essential safety net is in place, you can prioritize goals that align with your lifestyle and values, such as long-term wealth building, financial independence, or providing for your family’s future.

How many financial goals should you have at once?

It’s often best to focus on a manageable number of goals (such as two or three) at one time. Trying to juggle too many can spread your money and attention too thin, making it harder to make meaningful progress. A practical approach is to prioritize one short-term goal (like building an emergency fund), one medium-term goal (such as saving for a car or vacation), and one long-term goal (like retirement savings). This balance helps you stay focused while still moving forward in multiple areas.

What is a good financial goal for a beginner?

A great financial goal for beginners is starting an emergency fund. Even saving a small amount, such as $500, can provide a cushion against unexpected expenses and reduce the need to rely on credit cards or loans. Once that’s established, beginners can aim to save three to six months of living expenses. Other beginner-friendly goals include paying off small debts, creating a realistic budget, or setting up automatic savings. These goals build confidence and establish strong money habits for future success.

How can I set financial goals with a partner or family?

Setting financial goals with a partner or family starts with open communication about values, priorities, and long-term dreams. Begin by discussing shared goals, such as buying a home, paying off debt, or saving for children’s education. Next, agree on a budget and assign responsibilities for managing finances to ensure accountability. Regular check-ins help you stay on track, celebrate progress, and adjust goals as life circumstances change.

What tools can help me track my financial goals?

Several tools can make tracking financial goals easier and more organized. Budgeting apps like YNAB, GoodBudget, or PocketGuard allow you to set savings targets and monitor spending. Spreadsheets are another customizable option for tracking progress. Many banks also offer built-in goal-tracking features through their mobile apps.

For long-term goals, investment platforms often provide dashboards showing growth toward retirement or wealth-building objectives. The key is choosing a tool you’ll use consistently, helping you stay motivated and accountable.

---

SoFi Checking and Savings is offered through SoFi Bank, N.A. Member FDIC. The SoFi® Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.

Annual percentage yield (APY) is variable and subject to change at any time. Rates are current as of 12/23/25. There is no minimum balance requirement. Fees may reduce earnings. Additional rates and information can be found at https://www.sofi.com/legal/banking-rate-sheet

Eligible Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Eligible Direct Deposit”) via the Automated Clearing House (“ACH”) Network every 31 calendar days.

Although we do our best to recognize all Eligible Direct Deposits, a small number of employers, payroll providers, benefits providers, or government agencies do not designate payments as direct deposit. To ensure you're earning the APY for account holders with Eligible Direct Deposit, we encourage you to check your APY Details page the day after your Eligible Direct Deposit posts to your SoFi account. If your APY is not showing as the APY for account holders with Eligible Direct Deposit, contact us at 855-456-7634 with the details of your Eligible Direct Deposit. As long as SoFi Bank can validate those details, you will start earning the APY for account holders with Eligible Direct Deposit from the date you contact SoFi for the next 31 calendar days. You will also be eligible for the APY for account holders with Eligible Direct Deposit on future Eligible Direct Deposits, as long as SoFi Bank can validate them.

Deposits that are not from an employer, payroll, or benefits provider or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, Wise, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Eligible Direct Deposit activity. There is no minimum Eligible Direct Deposit amount required to qualify for the stated interest rate. SoFi Bank shall, in its sole discretion, assess each account holder's Eligible Direct Deposit activity to determine the applicability of rates and may request additional documentation for verification of eligibility.

See additional details at https://www.sofi.com/legal/banking-rate-sheet.
*Awards or rankings from NerdWallet are not indicative of future success or results. This award and its ratings are independently determined and awarded by their respective publications.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

We do not charge any account, service or maintenance fees for SoFi Checking and Savings. We do charge a transaction fee to process each outgoing wire transfer. SoFi does not charge a fee for incoming wire transfers, however the sending bank may charge a fee. Our fee policy is subject to change at any time. See the SoFi Bank Fee Sheet for details at sofi.com/legal/banking-fees/.
Third Party Trademarks: Certified Financial Planner Board of Standards Center for Financial Planning, Inc. owns and licenses the certification marks CFP®, CERTIFIED FINANCIAL PLANNER®

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

SOBNK-Q325-098

Read more

With the average annual cost of college now $29,910 at public schools (for in-state students) and $62,990 for private schools, figuring out how to pay for college as a low-income student can be daunting. It’s important to keep in mind, however, that students from low-income backgrounds often qualify for grants and scholarships (which you don’t have to pay back), as well as student loans.

Federal student loans are available to all college students, regardless of income, and don’t require a credit check. If you still have gaps in funding after tapping financial aid and federal loans, you may also be able to qualify for private student loans, even with a low income.

Read on to learn more about the financial aid options available to you if you qualify as a low-income student, as well as how to apply for student loans.

What Are Student Loans?

Student loans are an often-used option to help pay for college. In fact, roughly 53% of students who complete their undergraduate programs take out federal loans at some point during their college years, according to the Education Data Initiative.

Student loans can be used to pay for tuition, fees, room and board, as well as other associated costs of college like books and supplies.

Students can use either federal or private student loans to pay for college. Students who take out federal student loans borrow money from the government, through the U.S. Department of Education. Federal student loans typically offer low, fixed interest rates and other benefits, such as income-driven repayment and access to forgiveness programs.

Private student loans, by contrast, are available from banks, credit unions, and other private lenders. These lenders set their own interest rates and conditions for their student loans. To qualify for a private student loan, you need to fill out an application and disclose personal financial information, such as your income and credit score.

Since students typically don’t have well-established credit histories, many private loans require a cosigner. A cosigner is someone who agrees to pay back the loan if the primary borrower is unable to do so. Because private student loans don’t offer the same borrower protections that come with federal student loans, you generally only want to consider them after you’ve depleted all of your federal student aid options.

Can You Get Student Loans With a Low Income?

Yes, you can get student loans if you have a low income. If you can’t cover the full cost of college with scholarships and grants, student loans can help you take care of the remaining costs of college.

You can access federal student loans no matter your income level, but you do need to meet specific qualifications. You must:

•   Have a high school diploma or a recognized equivalency, such as a GED, or have completed a state-approved home-school high school education.

•   Be a U.S. citizen or an eligible noncitizen

•   Have a valid Social Security Number

•   Be enrolled or accepted for enrollment as a regular student in an eligible degree or certificate program

•   Maintain satisfactory academic progress in college

You may also be able to qualify for some private student loans if you have a low income (more on that below).

Recommended: Finding Free Money for College

Low-Income Financial Aid Options

Students and their families pay for college in a variety of ways, including savings, scholarships, grants, work-study, and student loans. Indeed, paying for college often looks like a puzzle — all the pieces come together in different ways to make everything “fit.”

Here’s a look at how to access low-income student aid options.

FAFSA

Every student (whether they’re low-income students or not) can file the Free Application for Federal Student Aid (FAFSA®). The FAFSA is the free form you can fill out to apply for financial aid for undergraduate or graduate school, and is one of the most important steps students and their families can take to pay for college.

In conjunction with the school you plan to attend, the FAFSA determines your eligibility for need-based and non-need-based financial aid. The FAFSA results determine the amounts you receive for federal grants, scholarships, work-study, and/or federal student loans. In addition to subsidized federal student loan (which are need-based) and unsubsidized federal student loans (which are not need-based), there are two other types of federal aid low-income students may qualify for based on the FAFSA:

•   Federal grants Students who demonstrate financial need may qualify for federal grants, which you generally do not need to pay back. Some examples of federal grants include the Federal Pell Grant, Federal Supplemental Educational Opportunity Grant (FSEOG), and Teacher Education Assistance for College and Higher Education (TEACH) Grant. Each grant has its own eligibility requirements. Some, like the TEACH Grant, even have requirements you must fulfill after you attend school. Look at each grant’s eligibility requirements to determine whether you qualify.

•   Work-study Colleges and universities offer part-time work-study opportunities through the Federal Work-Study program. Graduate and undergraduate students who demonstrate financial need can qualify whether they are part- or full-time students, as long as their school participates in the Federal Work-Study Program.

How Do You File the FAFSA?

Typically, the FAFSA becomes available on October 1 for the following academic year. Since some aid is distributed on a first-come, first-served basis, it’s a good idea to complete the FAFSA as soon after its release as possible. Here’s how:

Since some aid is distributed on a first-come, first-served basis, it’s a good idea to complete the FAFSA as soon after its release as possible. Here’s how:

1.    Create your Federal Student Aid ID, also called an FSA ID. You can do this in advance of getting your materials ready and filing the FAFSA.

2.    Make a list of schools you’d like to attend. You can add up to 20 schools on the FAFSA.

3.    Gather financial documents you’ll need. You’ll need information for both yourself and your parents, such as your Social Security numbers, most recent federal income tax return, current bank statements, and records of any investments you have.

4.    Complete the FAFSA. Using your FSA ID, log in to the website, read the directions, and submit your information.

5.    Review your FAFSA Submission Summary to make sure your information looks correct. The FAFSA Submission Summary, formerly known as the Student Aid Report (SAR), is a document that summarizes the information you provided when filling out the FAFSA. It includes your Student Aid Index (SAI), previously called Expected Family Contribution (EFC). Colleges and universities receive your SAI to determine your eligibility for federal and nonfederal student aid.

Federal Pell Grant

Your SAI will determine your eligibility for a Federal Pell Grant, so you have to file the FAFSA in order to qualify.

Undergraduate students who qualify for a Federal Pell Grant must show exceptional financial need. These grants are usually reserved only for undergraduate students, though some students enrolled in a post-baccalaureate teacher certification program might qualify.

How much can you receive from a Pell Grant? The amount varies, depending on your SAI, the cost of attendance of your school, whether you are a part-time or full-time student, and whether you will attend for a full academic year or not. The maximum Pell Grant award for the 2025-2026 academic year is $7,395.

Scholarships for Low-Income Students

Colleges and universities may offer need-based scholarships. The money is yours to use for education — you do not need to pay it back. The results of the FAFSA help colleges and universities determine your eligibility for need-based scholarships and scholarships for low-income students.

You can also find need-based scholarships through employers, individuals, private companies, nonprofit organizations, religious groups, and professional and/or social organizations. There are a number of online scholarship search tools that can help you find scholarships you might qualify for.

Student Loans for Low-Income Families

As mentioned above, you can tap into either federal or private student loans for low-income students. Here’s a closer look at both.

Federal Student Loans

Based on the results of the FAFSA, you may qualify for a few types of federal student loans. Subsidized federal loans are need-based, while unsubsidized federal student loans are available to all students regardless of income or financial need.

Here’s a quick overview of three main types of federal loans:

•   Direct Unsubsidized Loans can go to undergraduate, graduate, and professional students. They are not need-based, and you are responsible for paying all interest, which begins accruing as soon as the loan is dispersed.

•   Direct Subsidized Loans are for undergraduate students who demonstrate financial need. The government pays the interest on these loans while you’re in school, during any deferment, and during the six-month grace period after you graduate.

•   Direct Plus Loans are available for graduate or professional students or parents of undergraduate students and are not need-based or subsidized. Borrowers must undergo a credit check to look for adverse events, but eligibility does not depend on your credit scores. (Note: As of July 1, 2026, Federal Direct PLUS Loans for graduate students will no longer be available. Federal Direct Loans will remain, however, and are available to graduate and professional students.)

Private Student Loans

Federal student loans don’t fully cover the cost of attendance for many students, and some students may consider tapping into private student loans as well.

Private lenders set their own requirements, however, and some students may find it challenging to qualify for a private loan if they have:

•   Little to no income

•   A negative credit history

•   A bankruptcy on file

•   A low credit score

How do you get around these issues? You may need to get a job while in school to prove you have some income. You may also want to work on building your credit before you apply for a private student loan. While you may be able to qualify with low income and low credit, you may make up for it by paying more in interest.

Another way to qualify for a private student loan with a low income and/or poor (or limited) credit is to apply with a cosigner. A student loan cosigner is a creditworthy adult who signs for a loan along with you. It’s a legally binding agreement stating that they’re willing to share the responsibility of repaying the loan on time and in full. Many borrowers turn to a family member for cosigning.

Recommended: University of South Florida Cost

How to Apply for Student Loans

How to apply for student loans will differ depending on whether you are interested in federal or private student loans.

To apply for federal student loans, the first step is to fill out the FAFSA. Once you’ve filed the FAFSA, you basically sit back and wait to see what the school you’re planning to attend will offer you in federal aid, which may include a mix of grants, scholarships, work-study, and federal student loans. Your school will tell you how to accept all or a part of the loan.

Before you receive your loan funds, you will be required to complete entrance counseling, a tool to ensure you understand your obligation to repay the loan, and also sign a Master Promissory Note, agreeing to the terms of the loan.

Applying for private student loans involves directly going to a lender website or simply talking to your college or university’s financial aid office. Many institutions put together a list of what they call “preferred lenders.”

Even if your school makes it easy for you to apply for a private student loan, it’s a good idea to do your research outside of the preferred lender list to find low interest rates and compare interest rate types (fixed or variable), repayment schedules, and fees. You want to find the terms and conditions that best fit your needs.

As you are researching private student loans, you’ll want to make sure that you (or your cosigner) meets the requirements to qualify for the loan.

The Takeaway

Even if you’re a low-income student, you can access student loans. To find out what federal student loans you are eligible for, you’ll need to fill out the FAFSA. As a low-income student, you may qualify for subsidized federal student loans, which won’t accrue any interest while you’re in school and for six months after you graduate. This makes them more affordable than unsubsidized federal student loans and private student loans.

If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.

Cover up to 100% of school-certified costs including tuition, books, supplies, room and board, and transportation with a private student loan from SoFi.

FAQ

What qualifies as a low-income student?

The U.S. Department of Education defines a low-income student as an individual whose family’s taxable income for the preceding year did not exceed 150% of the poverty income level established by the Census Bureau. For example, a student from a family of four living in the contiguous U.S. with a household income of $48,225 or less is considered low-income.

Do low-income students get free college?

Some low-income students are able to go to college for free through financial aid or merit scholarships. But even without a full ride, low income students can often pay for college through a combination of scholarships, grants, and federal student loans.

Does FAFSA help low-income students?

Yes, filling out the Free Application for Federal Student Aid, better known as the FAFSA®, gives low-income students access to financial aid, including grants, scholarships, work-study programs, and federal student loans.

---

About the author

---

Photo credit: iStock/Souda

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student loans are not a substitute for federal loans, grants, and work-study programs. We encourage you to evaluate all your federal student aid options before you consider any private loans, including ours. Read our FAQs.

Terms and conditions apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. SoFi Private Student loans are subject to program terms and restrictions, such as completion of a loan application and self-certification form, verification of application information, the student's at least half-time enrollment in a degree program at a SoFi-participating school, and, if applicable, a co-signer. In addition, borrowers must be U.S. citizens or other eligible status, be residing in the U.S., Puerto Rico, U.S. Virgin Islands, or American Samoa, and must meet SoFi’s underwriting requirements, including verification of sufficient income to support your ability to repay. Minimum loan amount is $1,000. See SoFi.com/eligibility for more information. Lowest rates reserved for the most creditworthy borrowers. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change. This information is current as of 4/22/2025 and is subject to change. SoFi Private Student loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

SoFi Bank, N.A. and its lending products are not endorsed by or directly affiliated with any college or university unless otherwise disclosed.

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SOISL-Q325-145

Read more

Declaring a major in college is a big decision, but the choices don’t stop there. Once students know their area of study, then comes the selection of courses. And, generally, you can’t just sign up for classes willy-nilly. Students typically need to start at one point before they can progress to another. This is where upper and lower division courses come into play.

Like levels in a video game, students have to start with beginner lessons before they can take on advanced challenges. Here’s a closer look at what lower division and upper division courses are and how they differ.

Types of Courses Students Can Take

When signing up for your first semester of college classes, you might notice that there are many more offerings than you had in high school.

In addition, core classes are different, and requirements will vary based on a student’s course of study.

While a college student can take everything from astronomy to architecture, here’s how courses are typically designated:

•   Lower division

•   Upper division

•   Major courses

•   Minor courses

•   General education courses

💡 Quick Tip: You can fund your education with a competitive-rate, no-fees-required private student loan that covers up to 100% school-certified costs.

Degree Requirements

Every college major will have different courses, electives, and requirements that are necessary for graduating.

In addition to core requirements, students might need to take general education (gen ed) courses. These courses are required for all students, no matter their area of study. (Some will “CLEP out of” some or all gen ed courses. The College-Level Examination Program® offers 34 exams that cover intro-level college course material. Others might pass AP or International Baccalaureate exams to get college credit.)

Students won’t get to graduate just by taking classes for four years. They’ll need to meet the requirements of the major (and minor, if applicable) they’ve selected.

Each course has a number of credits, and students usually will need to accumulate a certain number of credits to qualify for their degree.

Degree requirements will vary based on what a student studies, but each will come with a mix of lower-division and upper-division courses to round out the educational experience.

Recommended: Harvard University Cost

What Is a Lower Division Course?

Lower-division courses are the building blocks of an undergraduate’s major. College freshmen might have restrictions in the courses they can enroll in.

Unless they bring in AP, IB, or college credits, they’ll need to take (and pass) lower- division courses in their major before being able to sign up for upper-division courses.

In general, here’s what students can expect in lower-division classes :

•   Introductory material Typically, lower-division courses teach the building blocks of concepts that students will use more down the line. For example, a biology major might start the course requirements with a lower-division Introduction to Biology lecture before moving on to more challenging material.

•   Younger students Generally, students will find more freshmen and sophomores in their lower-division courses.

•   A larger class Depending on the size of the school, lower-division classes are often larger because they may cover a broad swath of material that applies to multiple majors and areas of study. A lower-division class might even have more than one section a semester because so many students need to take it. In these larger lectures, participation might be limited, and attendance might not even count toward a grade.

•   A stricter structure Students might find that lower-division courses stick to the book (or syllabus). Each class, a professor will typically cover exactly what was detailed in the syllabus — nothing more, nothing less. Similarly, test questions might come straight out of lecture notes or assigned readings. Often this is done to ensure that students know the basics by heart before moving on to more challenging courses in their major.

•   Evaluation by test Due in part to their larger class sizes and structure, students can often expect multiple-choice tests in lower-division courses.

Of course, every college’s policies on classes are different, but for the most part, students can expect to take lower-division courses as they begin their academic career.

Lower-division courses may be required by a major or minor, or they might be a general education course all students are asked to take.

Recommended: Purdue University Cost

What Is an Upper-Division Course?

If lower-division courses are the foundation an education is built on, upper-division courses are the structure on top.

Lower-division courses sometimes count as prerequisites for upper-division classes. That means an undergraduate must take, and pass, a lower-division class before enrolling in an upper-division course.

Here’s what a student might experience in an upper division-course:

•   In-depth curriculum Upper-division classes are often a deeper dive into areas of study or cover more complex topics. Once students master a lower-division class, they’ll be challenged with harder concepts in an upper-division class. Upper-division classes are more likely to have words like “advanced” in the title.

•   Older students Third- and fourth-year students are more likely to be in these courses, typically because they’ve taken the prerequisites.

•   Smaller classes Whereas lower-division classes may be large lectures, upper-division classes start to get smaller, in part because the curriculum is more specialized. The deeper a student gets into a major, the more in-depth classes become.

•   A fluid structure Upper-division courses likely have a syllabus and required reading, but the day-to-day structure of the class may be less lecture-focused. In fact, some classes are seminars where students are encouraged to contribute ideas in a discussion format, often resulting in a participation grade.

•   Varied evaluations Depending on the class focus, testing may look different than that of a lower-division course. Students may be asked to write in-depth research papers or create large presentations to show their learning. If tests are in use, they might rely less on multiple-choice questions.

Since upper-division courses include more complex teachings, professors might expect students to show what they’ve learned in a more complex way. That might mean essays to prove an argument, or demonstration of critical thinking skills that don’t rely purely on lecture notes or readings.

Recommended: The Ultimate Guide to Studying in College

Numbering Systems for Division Courses

A simple way to tell if a class is a lower- or upper- division course is using a school’s numbering system for classes.

Most college courses will have a three- to five-digit number. The number is unique to the course, and can help students know what they’re getting into before they sign up in terms of difficulty.

While numerical systems will change from college to college, they might follow these general formulas:

•   1-199 At UCLA, for example, all undergraduate courses are assigned a number between 1 and 199. Any class with a number between 1 and 99 is a lower-division course, and any class with a number between 100 and 199 is an upper-division class.

•   100-499 Other schools, like the University of Arizona, might start the numbering higher. All lower-division classes are numbered from 100 to 299. Anything 300 to 399 is an upper-division course. The University of Massachusetts uses a slightly different system, where every 100 is a different year of school (100s are for freshmen, 200s for sophomores, etc.).

The numerical system for a college course probably won’t help students compare classes across different universities, but it can be a useful guide in plotting academic schedules within one school and major.


💡 Quick Tip: Even if you don’t think you qualify for financial aid, you should fill out the FAFSA form. Many schools require it for merit-based scholarships, too. You can submit it as early as Oct. 1.

Finding a Way to Pay

Figuring out how to pay for college can feel like an upper-division course in and of itself. After completing the Free Application for Federal Student Aid (FAFSA®), you may find that you are eligible for grants, scholarships, and subsidized or unsubsidized student loans. However, you may still fall short of all the funding you need.

That’s where private student loans can come in. These loans are available through private lenders, including banks, credit unions, and online lenders. Rates and terms will vary depending on the lender. Some students may need a cosigner to qualify for private student loans due to a lack of credit history and income.

If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.

Cover up to 100% of school-certified costs including tuition, books, supplies, room and board, and transportation with a private student loan from SoFi.

FAQ

What is the difference between upper and lower division courses?

Lower-division courses are typically introductory classes taken in the first two years of college. They cover general education and foundational subjects, building the skills needed for more advanced study. Upper-division courses, usually numbers 300-400, are taken in the junior and senior years. These classes go deeper into a student’s major, focusing on specialized topics, critical thinking, and research.

Are upper division classes harder?

Upper-division classes are generally considered more challenging than lower-division courses because they expect students to apply foundational knowledge, analyze complex topics, and engage in advanced discussions or projects. Instead of broad overviews, these classes often focus on specialized subjects within a major. However, whether they feel “harder” depends on the student’s preparation, interest, and study habits. Many find upper-division courses more engaging since they align closely with their career goal and academic interests.

What is the difference between 100 vs 200 vs 300 vs 400 level courses?

Course numbering often indicates difficulty and progression. Generally, 100-level courses are usually introductory, covering basic concepts for freshmen; 200-level courses may still be broad but require some prior knowledge, usually for sophomores; 300-level courses are upper division, often focusing on advanced, specialized topics for juniors; 400-level courses are typically the most advanced undergraduate classes, sometimes involving research, capstone projects, or preparation for graduate-level work.

---

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student loans are not a substitute for federal loans, grants, and work-study programs. We encourage you to evaluate all your federal student aid options before you consider any private loans, including ours. Read our FAQs.

Terms and conditions apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. SoFi Private Student loans are subject to program terms and restrictions, such as completion of a loan application and self-certification form, verification of application information, the student's at least half-time enrollment in a degree program at a SoFi-participating school, and, if applicable, a co-signer. In addition, borrowers must be U.S. citizens or other eligible status, be residing in the U.S., Puerto Rico, U.S. Virgin Islands, or American Samoa, and must meet SoFi’s underwriting requirements, including verification of sufficient income to support your ability to repay. Minimum loan amount is $1,000. See SoFi.com/eligibility for more information. Lowest rates reserved for the most creditworthy borrowers. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change. This information is current as of 4/22/2025 and is subject to change. SoFi Private Student loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

SoFi Bank, N.A. and its lending products are not endorsed by or directly affiliated with any college or university unless otherwise disclosed.

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

SOISL-Q325-082

Read more

Even if your parents are high earners (or you’re a grad student with a good salary), it’s worth filling out the Free Application for Federal Student Aid, or FAFSA®. While your earnings are a factor on the FAFSA, there are no set income limits to apply or to qualify for aid, and not all programs are based on need. The FAFSA also provides access to non-need-based programs, including institutional merit aid and unsubsidized federal loans.

Regardless of income, It’s generally recommended to fill out the FAFSA as close to its release date as possible. Typically, the FAFSA opens on October 1 for the following academic year.

Read on to learn more about income requirements to be eligible for financial aid and why it’s probably a good idea to fill out the FAFSA.

What Are FAFSA Income Limits?

There is no income maximum when you file the FAFSA as an undergraduate or graduate student to attend college or career school. In other words, any student attending or applying to an eligible school can fill out and submit the online form, even if they or their parents are higher earners.

In addition, there are no simple income cutoffs for financial aid eligibility, in part due to the complexity of financial aid formulas.

In general, to be eligible for financial aid, you’ll need to:

•   Have a high school diploma or a recognized equivalency, such as a GED, or have completed a state-approved home-school high school education

•   Demonstrate financial need (for most programs)

•   Be a U.S. citizen or an eligible noncitizen

•   Have a valid Social Security Number

•   Be enrolled or accepted for enrollment as a regular student in an eligible degree or certificate program

•   Maintain satisfactory academic progress in college if you’re already enrolled. Standards for satisfactory academic progress vary by school

💡 Quick Tip: Make no payments on SoFi private student loans for six months after graduation.

How Are FAFSA Needs Calculated?

Your eligibility for scholarships, grants, work-study, and federal student loans depends on two key factors: your Student Aid Index (SAI) and the school’s cost of attendance (COA).

If you’re a dependent student with divorced parents, the parent who provided more financial support to you during the last 12 months should complete the FAFSA. If both parents provided an equal amount of financial support (or if they don’t support you financially), the parent with the greater income and assets should fill out the FAFSA.

SAI

The Student Aid Index (SAI) is an eligibility index number (ranging from –1500 to 9999990) that a college’s financial aid office uses to determine how much federal aid a student would receive if they attended the school.

SAI is calculated using the information you provide in the FAFSA. The formula assesses you and your parents’ total financial resources (including income and assets), then deducts the minimum amount needed for your family’s normal annual living expenses. The remaining amount may, in part, be allocated for college expenses.

Where you fall on the SAI scale helps your school determine what level of financial support you may need.

Recommended: Harvard University Cost

Cost of Attendance

The cost of attendance (COA) of a college or university refers to the estimated cost of a year of attendance at that school, including tuition, lodging, food, local transportation, and personal expenses.

When financial aid staffers at a college or university calculate the amount of financial aid you can qualify for, they consider your SAI, any other financial assistance you are already receiving, and the school’s COA to determine your financial need.

You can get an estimate of how much financial aid you might qualify for by using the government’s Federal Student Aid Estimator .

Grants and Loans That Require Financial Need

Federal grants and loans that require you to demonstrate financial need in order to qualify include:

•   Federal Pell Grants

•   Federal Supplemental Educational Opportunity Grants

•   Federal Work-Study Program

•   Direct Subsidized Loans

Different Kinds of Financial Aid

Submitting the FAFSA puts you in the running for need-based, as well as non-need-based, aid. Depending on your financial profile, here’s what you may be able to get by completing the form.

Pell Grants

The Pell Grant is a need-based financial aid program from the federal government that is designed to help undergraduates from low-income families afford college. The Federal Pell Grant award amount changes yearly. The maximum Pell Grant award for the 2025-26 academic year is $7,395.

The actual amount of Pell Grant you can receive depends on your SAI, the COA at your college or university, your status as a full-time or part-time student, and the amount of time that you will attend school during the academic year.

FSEOG

The Federal Supplemental Educational Opportunity Grant (FSEOG), which typically doesn’t have to be repaid (unless you don’t fulfill your end of the bargain by completing school), goes to students who demonstrate exceptional need, as determined through the FAFSA.

The awards range $100 to $4,000 a year. The amount of money you can get depends not only on your level of need but also on when you apply, the amount of other aid you get, and how much your college or university can offer students.

Work-Study Programs

Work-study is a federal program that helps college students with financial need get part-time jobs either on or off campus to earn money for college. Students are typically responsible for securing their own work-study jobs.

Not all schools offer work-study, so it’s a good idea to reach out to the financial aid offices at the schools you’re interested in to see if they offer the program. To apply for work-study, you simply need to select the box on the FAFSA that indicates you want to be considered for work-study.

Direct Subsidized Loans

A Direct Subsidized Loan is a loan provided by the federal government for students who demonstrate financial need. You do not have to pay interest on the loan while you’re in school, during any deferment, or for six months after you graduate (known as the grace period). The government picks up this tab.

Before receiving the funds from a Direct Subsidized Loan, you need to complete entrance counseling, which goes over your obligation to repay the loan, and sign a master promissory note, which indicates that you agree to the loan terms.

For undergraduate students who get (or got) loans after July 1, 2025 and before July 1, 2026, the interest rate for Direct Subsidized Loans is 6.39%.

Direct Unsubsidized Loans

Like a Direct Subsidized Loan, a Direct Unsubsidized Loan comes from the federal government, but graduate and professional students can also receive these loans.

Unlike Direct Subsidized Loans, Direct Unsubsidized Loans are non-need based and the government does not pay the interest while you’re in school, during any deferment, and during the grace period. You will be responsible for paying all interest, which begins accruing as soon as the loan is dispersed.

For undergraduate students who get (or got) loans after July 1, 2025 and before July 1, 2026, the interest rate for Direct Unsubsidized Loans is 6.39%.

For graduate or professional students, the interest rate for Direct Unsubsidized loans is 7.94%.

It’s worth noting that for both types of Direct loans, you do not need to undergo a credit check in order to qualify. These types of loans also have annual and aggregate loan limits.

Direct PLUS Loan

Parents of undergraduate students and graduate or professional students can receive a Direct PLUS Loan from a school that participates in the Direct Loan Program. Some schools call this loan type a parent PLUS loan or grad PLUS loan to differentiate the two.

For Direct PLUS Loans first disbursed on or after July 1, 2025, and before July 1, 2026, the interest rate is 8.94%.

You’ll undergo a credit check as a parent or a graduate/professional student to look for adverse events, but eligibility does not depend on your credit scores.

(Note: As of July 1, 2026, Federal Direct PLUS Loans for graduate students will no longer be available. Federal Direct Loans will remain, however, and are available to graduate and professional students.)


💡 Quick Tip: Parents and sponsors with strong credit and income may find competitive rates on no-fees-required private parent student loans than federal parent PLUS loans. Federal PLUS loans also come with an origination fee.

Beyond Federal Student Loans

Do you have to file the FAFSA? No, it’s not required, but it is a good idea to do so. Schools, states, and other programs also use the FAFSA to determine merit-based grants and scholarships.

Aside from federal loans, here’s a look at other ways to pay for college.

Savings

Some parents, and grandparents, prepare for the task of paying for college well in advance using a tax-advantaged savings account, such as a 529 account. A 529 plan allows your savings to grow tax-free, and some states even offer a tax deduction on your contributions.The advantage of tapping into savings is obvious: You don’t have to borrow funds and pay interest.

Private Student Loans

Private student loans come from a bank, credit union, or other private lender. Loan limits vary by lender, but you can often get up to the total cost of attendance for school. Each lender sets its own interest rate and you can often choose to go with a fixed or variable rate. Unlike some federal loans, qualification is not need-based. However, you will need to undergo a credit check, and students often need a cosigner.

You generally want to exhaust federal loan options before turning to private student loans, since private loans generally don’t offer the borrower protections — like income-based repayment and forbearance — that come with federal student loans.

Grants

Grants, which are typically need-based, are a type of financial aid that students generally don’t have to repay. The federal grant program includes the Pell Grant, Federal Supplemental Educational Opportunity Grant, and Teacher Education Assistance for College and Higher Education (TEACH) Grant.

A student can seek other grants from their state, their college or career school, or another organization.

Scholarships

Scholarships, like grants, are a type of financial aid that you don’t have to pay back. Scholarships are available through a wide variety of sources, including professional organizations, your job or your parents’ jobs, local organizations, religious groups, your college or career school, and more.

There are a number of scholarship finders available online.

Part-Time Work

Even if you don’t qualify for work-study, you can look for a part-time job. If you have the time and energy to pair a part-time job with your studies, you can consider doing so after classes or on the weekends. Part-time work can help you pay for school or additional expenses, such as rent or groceries.

The Takeaway

There are no income limits for filing the FAFSA, and completing it can open the door to a wide range of financial aid opportunities — from need-based grants and work-study programs to merit aid and federal loans. Even if you or your parents earn a higher income, submitting the FAFSA early ensures you won’t miss out on potential opportunities to lower the cost of college.

If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.

Cover up to 100% of school-certified costs including tuition, books, supplies, room and board, and transportation with a private student loan from SoFi.

FAQ

Can you get financial aid if your parents make over $100K?

The U.S. Department of Education doesn’t have an official income cutoff to qualify for federal financial aid. The reason is that the formula for determining need-based aid is complex and involves more than just your parents’ income. Assets, the size of your family, your school’s cost of attendance, and other factors all go into deciding how much aid you can receive.

Also keep in mind that not all financial aid is need-based, including Federal Direct Unsubsidized Loans and institutional merit aid. That’s why it’s important to fill out the Free Application for Federal Student Aid (FAFSA®) each year.

How are FAFSA income limits different for divorced parents?

For the FAFSA®, the parent who provided more financial support to you over the past 12 months is responsible for completing the FAFSA, regardless of who you live with. If the parent who provides greater financial support has remarried, your stepparent’s income and asset information must also be reported on the FAFSA.

Are FAFSA income limits different for independent students?

No. The U.S. Department of Education uses the same formula for calculating aid regardless of whether you are a dependent or independent student.

That said, independent students may receive more aid than dependent students simply because they tend to have less income and fewer assets to report. You can qualify as an independent student if you are at least 24 years old, married, a graduate or professional student, a veteran, a member of the armed forces, an orphan or a ward of the court, or taking care of legal dependents.

---

About the author

---

Photo credit: iStock/Prostock-Studio

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student loans are not a substitute for federal loans, grants, and work-study programs. We encourage you to evaluate all your federal student aid options before you consider any private loans, including ours. Read our FAQs.

Terms and conditions apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. SoFi Private Student loans are subject to program terms and restrictions, such as completion of a loan application and self-certification form, verification of application information, the student's at least half-time enrollment in a degree program at a SoFi-participating school, and, if applicable, a co-signer. In addition, borrowers must be U.S. citizens or other eligible status, be residing in the U.S., Puerto Rico, U.S. Virgin Islands, or American Samoa, and must meet SoFi’s underwriting requirements, including verification of sufficient income to support your ability to repay. Minimum loan amount is $1,000. See SoFi.com/eligibility for more information. Lowest rates reserved for the most creditworthy borrowers. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change. This information is current as of 4/22/2025 and is subject to change. SoFi Private Student loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

SoFi Bank, N.A. and its lending products are not endorsed by or directly affiliated with any college or university unless otherwise disclosed.

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

SOISL-Q325-144

Read more