"College students are increasingly turning to crowdfunding to help cover their education expenses, according to new data from the fundraising platform GoFundMe," MarketWatch reports.
..."Students considering using crowdfunding for college costs should first make sure they understand how their school will treat the money when calculating their financial aid package, said Karen McCarthy, vice president for public policy and federal relations at the National Association of Student Financial Aid Administrators. Donations made to personal GoFundMe fundraisers are generally considered to be “personal gifts” which, for the most part, are not taxed as income in the United States, a GoFundMe spokesperson said. GoFundMe charges a transaction fee of 2.9% + $0.30 per donation.
Students who’ve sought donations on GoFundMe recently include a Sacramento nursing student who said she needed to pay off a $4,600 balance before she could take her exit exam and graduate from her program; a sophomore art student in Santa Fe who said an “unexpected circumstance” left him with a $3,176 fee bill; and a student looking for $3,800 to finish her culinary degree at a Virginia community college.
Several of the tuition-related campaigns on GoFundMe appear to be for students in financial straits because of unanticipated setbacks. One silver lining of the pandemic is that colleges and universities have become more equipped to help students cope with such financial emergencies, McCarthy said. That’s because when federal pandemic relief money was flowing to college campuses, schools handed out emergency grants to students. In tracking how the money was spent, schools learned a lot about the types of surprise costs that can sometimes force students to drop out of college, McCarthy said.
Pandemic relief money is gone now, but some schools have set up their own emergency grant funds to help students bridge sudden financial gaps. 'A lot of institutions really became aware of the emergency needs that their students have and how they might move forward in meeting those needs,' McCarthy said. 'The development of some of those emergency-aid programs may help students meet those needs so they don’t have to resort to things like crowdfunding.'"
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Publication Date: 3/1/2023