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A college education is one of the major investments any individual will make throughout their lives. Many individuals struggle with finding the resources required for a sound tertiary education and have had to resort to seeking financial assistance. Most students will rack up a debt averaging $60,000 by the time they have completed say a bachelor’s degree program and we all know this money must come from somewhere.

Before the advent of online colleges, most individuals went to traditional colleges where they had no problems receiving financial assistance through the various government educational support programs. However, what of this new growth in the online student community, are they accommodated under this system?

Online College Financing

Students of online colleges need not to worry about receiving financing for their studies. The government has acknowledged the contribution made by online colleges and has extended their financial aid to these accredited online colleges. As long as the online college is accredited by the various government affiliated boards such as the Secretary of Education, then its students qualify for student loans.

Types of Online College Financial Aid Available

Online students have several options through which they can receive financial aid. However, this support is restricted to student existing within the US. This aid can be accessed through government and private loans, grants and scholarships.

• Government Loans: Government loans come in the form of Stafford, Perkins and Pell loans. Each of these loans attracts different conditions and interest rates based on the financial situation of the student.

  Stafford loans are divided into two groups. Subsidized loans target students in dire financial conditions. Under this plan, the government foots the interest payments of these students until they have graduated and expired their grace period. Unsubsidized Stafford loans are available for all other students irrespective of their financial condition.
  Perkins and Pell Loan are subsidiary loans that are used to sure up the finances of students. To qualify students must have exhausted all Stafford loan opportunities.

• Private Loans: Private loans are designed for students who do not qualify for government student loans. This may be due to various issues such as immigration, unable to find a co-sponsor, register with unaccredited online colleges or may have exhausted their government student loan. Private Banks lend assistance to these students with loans that are generally above government rates and attract stringent loan conditions.
• Grants: A grant is a gift that covers tuition fees that is not required to be repaid by the recipient. These grants may be from both private and government sources. Generally, to qualify, students should have a GPA between 2.0 to 3.0.
• Scholarships: scholarships are awarded based on academic achievements. Scholarships may cover a part of or all of the tuition fees. They may be offered for various reasons such as community development, talent pooling or targeting of underprivileged students. Many companies also use scholarships as a means of reducing their tax burden through tax initiatives implemented by the government that forces these companies to give back to the communities in which they are located.

Over the past 10 years, we have seen many changes within the online educational community. Competition have increased has increased significantly with many traditional universities entering the market by offering online versions of their on-campus programs. In addition, the general cost of education has escalated due to the effects of inflation and technological advancements. Online universities have had to include marketing departments in their operations to seek out new markets to maintain their market share and most naturally, these expanses are transferred to the pockets of students.

The cost of online education is also influenced by the popularity on the university. As online universities become more experienced in the art of online education, they are able to improve their product. This will in turn increase their influence on the market as students who desire the best level of education flock to these online universities that have the most influence within the business sector.

Changes in Student Budget over the Years

To gain a better understanding of the changes in student budgets we can compare cost of online tuition from 1999 compared to that of 2009. On average, in 1999 that cost of online degree programs stood at $10,000 for public institutions and $20,000 for private institutions. During that time, online universities were not fully accepted within the business communities as online universities were still going through growing pains and not all had the relevant accreditation from the various boards.

Jump 10 years to 2009, online universities now form a vital part of the educational landscape. Many employers are now encouraging their employees to take advantage of online universities as they can improve their qualifications without disrupting their work schedule. As a result, the forces of supply and demand kick in as the increase in demand results in individuals willing to pay more for their education. Statistics show that currently in the year 2009, online students will have to fork out tuitions fees averaging $30,000 for public online institution and $45-50,000 for private institutions. This shows an average of a 50 to 60% increase in ten years.

If we conduct a more in-depth study based on the types of online degree programs, we see an even more disturbing trend. The cost of bachelor’s degree stick to the average trends of 50 t 60% but graduate programs see an increase of 102% over the past ten years. This is due to the significant increase in demand for postgraduate degree programs by working professionals. These individuals have to increase their educational arsenal to remain competitive against younger and more technologically advanced kids leaving high school. The fact that they can study without disrupting their work patterns has proven to be a hit among this target group. Another factor that affected the cost of postgraduate programs is that some online universities factored the improved salaries that graduates gain after the completion of a postgraduate degree program. Thus, they decided that these students would be prepared to pay for these opportunities.