With the economy still in the dumper and unemployment still above 9%, many people are taking this opportunity to go back to college to get a degree in something more marketable. That way when the economy finally does bounce back, the newly educated will be in a position to apply for more lucrative jobs. Great plan, except for one problem. How the heck do these people plan on paying for school? Not only must one come up with tuition, but you have to eke out a living as well.

Fortunately, you have some options when it comes to financial assistance for college. The most obvious is Federal Student Aid, which believe it or not, still exists even in these tough times when government is cutting back on programs such as unemployment and social security. The best place to look for information is on the Free the Application Federal Student Aid website. Here you’ll find several worksheets you can fill out to see you if you even qualify for FSA.

However a much less, but equally important place you can check on student aid is with your own employer. Many companies offer college tuition assistance for their employees, however, this type of aid has more strings attached (because it’s privately funded) than FSA, but is still worth investigating.

The best place to start is with your human resources department. Ask them if they have a company-subsidized higher education program, and if you qualify. But before you do, familiarize yourself with these four important points.

1. The IRS

The IRS allows every company to contribute up to $5,250 per year, tax free, to any employee’s college education. However, the employer must pay payroll taxes on any financial aid over $5,250 paid to a single employee in a calendar year, as the government then considers the additional funds extra income. This money can be used for tuition, books, school-mandated school supplies and equipment (such as computers). Your employer should know this, but if not, have him go to the Employer Tuition Assistance page of Fastweb for more information. There are many employer benefits to helping employees go back to school that your employer may not know about.

2. Your GPA and Major Requirements

Once your employer agrees to financially assist you with your education your employer has every right to insist on a minimum GPA and also to dictate what your major will be. It only makes sense that your employer doesn’t want to pay for an education you fritter away by not performing at least up to a C grade level. In fact, many employers reimburse tuition based upon the employee’s GPA. For example, 3.5 and above gets 100% tuition reimbursement. 3.0 to 3.499 yields 80% reimbursement, and so on.

Similarly, an employer who pays for an employee’s education can also insist the employee major in something that adds value to the company, which is not unreasonable. Why would a computer software company, for example, pay one of its employees to get a photography degree (unless, of course, photography was part of the employee’s job requirements).

3. Reimburse versus Direct Pay

If your employer agrees to pay for part or all of your tuition, find out when you’ll get the money. Some employers pay for tuition up front, when tuition is due. However, others pay upon completion of the class. In the latter case, YOU have to front the tuition money in order to become enrolled. The rule of thumb is to have at least two semesters worth of tuition in the bank, so you don’t have any interruptions in your education due to finances. To be safe, find out ahead of time exactly when your employer contributes to your tuition.

4. Repayment Clause

And finally, find out what happens if you change jobs after you’ve received your new degree. Many employers require a newly educated employee to stay with the company at least a year after completing a company-subsidized degree. Nothing makes an employer angrier than a valuable employee jumping ship for bigger bucks right after the employer paid for the education that made that jump possible.

With a new year coming up FSA and other financial assistance programs will be taking applications starting January 1. If you’re interested in going back to school, now’s the time to be doing your research. If you know of any specific corporate college tuition assistance programs, feel free to let us know by posting a comment. Or if you have experience with the FSA program, we want to hear about it. Nothing beats real life experience…except maybe a brand, spanking, new, lucrative college degree.

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