If you’re wary about borrowing money to finance your college education, your reluctance is understandable. According to the Huffington Post, there are about 40 million Americans currently carrying student loan debt. About seven million of these debtors (17.5 percent) are in default on their loans. The implications of heavy student loan debt and default can range from experiencing difficulty getting a mortgage or car loan to not being hired by prospective employers.
Raising money for College via Crowdfunding
An increasing number of students are turning to crowdfunding as an alternative to borrowing money for college. Crowdfunding is the practice of raising small amounts of money provided by multiple sources over a period of time. The process is akin to asking complete strangers for money. The Internet typically serves as the mechanism for matching students in need with potential funding sources.
One popular crowdfunding site is Kickstarter.com, which raised more than $274 million in funding for college students and a varied assortment of other projects in 2012 alone. The success of Kickstarter.com has led to the creation of other sites devoted to helping people develop sources for funding their education and other purposes. These sites include GoFundMe and Pave. Backers of these crowdfunding sites are often willing to provide funds because of philanthropy, investing, and simply a desire to help someone in need.
Crowdfunding Success Stories
Crowdfunding is a relatively new phenomenon. Many sites have yet to raise significant dollars. However, there are already multiple success stories that involve students accumulating major funds through their crowdfunding efforts:
Yanet Alvarez: While Alvarez did not actively pursue crowdfunding, she was able to benefit from the efforts of a Good Samaritan. When she was 15, Alvarez had a random encounter with Chris Cognac, a Hawthorne, CA police officer who was looking to do a good deed at Christmastime. Cognac was so taken by Alvarez that he decided to start a college fund for her on GoFundMe. The money that was raised was able to eventually help pay for Alvarez’s tuition at the University of California at Berkeley.
Cassie Wessely: Faced with the sudden death of her mother and no longer qualifying for financial aid, Wessely, a Vanderbilt University student, turned to crowdfunding to raise enough money to stay in school. Twenty-four hours after staring a GoFundMe page, she had received more than $25,000 in donations. This enabled her to meet her financial goal. After four days, total donations had reached $40,000.
Salina Vang: Vang is the daughter of Laotian immigrants who eventually settled in Minnesota. With nine brothers and sisters in the household, Vang knew that her parents would not be able to afford to pay for her college education. She’s using crowdfunding to raise money to attend the University of Minnesota-Duluth — she will be the first in her family to receive a college education.
Alexis-Brianna Felix: About halfway toward her goal of earning a Bachelor’s degree from Boston University, Felix came to the realization that she simply did not have enough money to continue her education. On October 13, 2013, she created a GoFundMe page asking for others to make an investment in her future. Within 27 hours she had raised more than $5,000. It was enough to help her pay for her spring semester at BU.
Griffin Furlong: Furlong was a high school valedictorian with a particularly compelling story: he was also homeless. Desperately wanting to attend college and with no available means of financial support to get there, he turned to crowdfunding. A friend started a GoFundMe campaign on Furlong’s behalf, which raised $26,000 in only six days. Furlong now attends Florida State University and has accumulated more than $100,000 via crowdfunding.
Starting Early Is the Best Way to Achieve the Greatest Crowdfunding Success
Of course, you may not experience the same results when using crowdfunding. Expect that it will take a great deal of time to accumulate a significant sum. It stands to reason that the earlier you start your crowdfunding campaign, the better your chances of reaching your fundraising goals.
If you’re a parent looking to accumulate college funds for your newborn child over a period of years, explore crowdfunding sites such as GrandSave and GiveCollege. You can register your child and ask your family and friends to make donations to a college fund.
Using social media can also prove invaluable in your crowdfunding efforts. Think of it in terms of building an online following or fan base. One method is to create a Twitter hashtag related to your crowdfunding campaign and use it consistently when tweeting.
CC Photo by Tax Credits