We are continuing our series on 7 alternatives to student loans to pay for college by talking about how to use crowdfunding to pay for college.
We have already shared how anyone at any age can find scholarships to pay for college. This is a key way since there are scholarships for seemingly anything and everything. The average return on investment to find and apply for scholarships yields a $100 per hour pay. There will not be many things beyond this to make that kind of money.
That brings us to the next alternative – albeit, not that well known, unconventional, but effective!
Have you ever thought about crowdfunding as a source of income to pay for college?
What is crowdfunding?
The simple explanation is that it is a way to fund a goal or project with small amounts of money from a lot of people.
It generally starts with close friends and family and spreads from there.
Imagine if you had 10,000 people contribute $1?
What if these same 10,000 people donated an average of $3 (some giving $1 and others giving more)?
Can you see how quickly funds can add up with the goal of these people investing just one of their daily Diet Coke’s into your future.
Even better is if you can attach some sort of benefit to your contributor like promising to stay debt-free during school, documenting your school process and experience for them to witness, or even donating your time to your community in some way as a way of saying “thanks.”
There are so many ideas. You don’t have to have a benefit attached, but people are more likely to contribute if you say, “I will invest in my future, not rely on government assistance, and give back to my community with my time at 1 hour per week, etc.”
There is also the benefit to your contributor, the taxpayer, to contribute $1 to your goal to help you avoid student loan debt – essentially letting them give you $1 to save $38 in taxes. Seriously, it has been estimated that every $1 borrowed costs the taxpayer $38.
That’s an incentive in and of itself!
How to start Crowdfunding to pay for college?
There are many sites and ways to start a crowdfunding contributing account. The most popular is KickStarter, but you generally have to have an actual project to fund and you cannot fund college through KickStarter. We only mention KickStarter because it is a crowdfunding platform that many are familiar with; funding college funding through crowdfunding works similarly, just through sites that allow you to fund college.
The others that work just for college funding are:
- GoFundMe has to be approved and charges 7.9% + $0.30 per transaction fee
- CrowdRise which charges 5.9-8.9% + $0.30 per transaction fee
- YouCaring has a specific donation spot for college fundraising, each campaign lasting 120 days and is free
- GoGetFunding which charges 4% of the transaction as the fee
- PlumFund has a no-fee program
- IndieGoGo is a popular site offering crowdfunding options
It’s pretty easy to set up a crowdfunding account for college purposes, you just have to be creative and honest.
Start marketing your college crowdfunding option by sharing your crowdfunding account with friends and family and encourage them to donate and spread the word. You never know how far your donations can spread.
Even if you raised just a few hundred dollars, that is a good return on your initial time investment and a good option to at least cover a few expenses.