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Work-study is a form of financial aid that can allow you to earn money on campus to pay for your college expenses.
Working part-time while studying is a great way to support yourself, avoid some of your student loan debt, and gain skills while you're still a student.
One way to hold down a part-time job while you pursue undergraduate, graduate, or professional studies is through the Federal Work-Study Program. The Federal Work-Study Program provides part-time jobs for students who demonstrate financial need.
Income from Federal Work-Study jobs is taxable but exempt from Social Security taxes (FICA). Here's everything you need to know about the Federal Work-Study program.
What is the work-study program?
The Federal Work-Study Program is a form of government student funding for the United States. The Work-Study Program allows eligible students to earn money in work-study-specific jobs.
The amount of work-study funding you are eligible for is listed in your grant letter. Your grant letter does not specify a minimum or maximum amount for work-study.
The exact amount depends on your school's study and work program, but typically the eligible amount is between $2,000 and $5,000 per year.
However, There is no guarantee that you will receive the full amount stated in the approval notice.Instead, you have to earn the money through a side job.
Most work-study jobs are typically on campus, such as working at the library circulation desk, as a janitor, or in food service. However, depending on your school's degree program, work-study can also include any number of part-time jobs, including positions at nonprofits or working at organizations related to your field of study.
The money from a work-study job generally “feels” more like the money from any other job. Typically, the school or your employer will send you a check every two weeks (or once a month) based on the number of hours you worked. Picking up an extra shift? You'll get a bigger paycheck.
Who is eligible for a work-study job?
To be eligible for a work-study job, you must complete the Free Application for Federal Student Aid (FAFSA). After completing the application, you will receive a letter explaining the types of aid you are eligible for. In many cases, students with financial need will be shown a work-study position.
However, a student scholarship does not guarantee that you will get a student job. You have to apply for a student job and actually do the work involved.
Additionally, you typically need to apply for the FAFSA application form early to be eligible. Make sure you know your state's FAFSA deadlines and apply early!
There are always a handful of coveted student jobs where you are essentially paid to do your schoolwork or surf the internet. However, in the student job world, it is not easy to get such a job. Most of these positions are hard work.
How much do you earn with a work-study job?
The amount you'll earn from a work-study job is typically on par with what anyone would earn for similar work. Depending on where you live in the country, the pay for the job can range from $7.25 per hour (the current federal minimum wage) to $22 per hour or more when the labor market is tight or in states with a higher minimum wage.
For a less stressful part-time job, the pay for a student job is usually reasonable. However, it won't make you rich. And you won't get big raises if you perform well.
Since the hourly rates for work-study jobs are “good,” I recommend that college students consider supplementing their work-study income by applying for scholarships or finding higher-paying jobs, such as playing in an ensemble, tutoring, car detailing, or refereeing sporting events. Even irregular income from these sources can make the difference between being able to pay for car insurance with a credit card and staying solvent in college.
How is the work-study income paid out?
Many families don't realize that work-study jobs pay the student the same amount of money as a regular job. Work-study income does not have to be paid to the college and is NOT paid directly. Instead, the student simply receives a paycheck every two weeks.
The student can choose to use the funds to pay school costs or use them at their own discretion – for food, leisure or other things.
With this in mind, families counting on financial aid to cover college costs should think again. Remember that the money may not be used entirely to pay for college.
Is the income from my work-study job taxable?
Income from student jobs is taxable. However, you avoid the 7.3% FICA tax that is normally deducted for Social Security and Medicare coverage.
If you earn relatively little, you'll probably get most of your income from your student salary. Enjoy your full paycheck now, because in a few years you'll hopefully be paying a lot of taxes (thanks to your high earnings).
Should I take a student job or try another part-time job?
If you are eligible for a work-study program, I would strongly encourage you to find the best work-study job possible. Use “best” in whatever sense you want. In college, I took a lower-paying job that allowed me to do homework during my office hours. This meant I had plenty of time for cross country and track and even the occasional side job.
I had a friend who worked at a local Boys & Girls Clubs of America, which led directly to an internship and subsequent career in the nonprofit sector.
Most of the time, the income from student jobs is relatively stable. You can expect to work roughly the same number of hours week after week. In general, most college students should be able to manage their studies and a student job without any problems.
The downside to working student jobs is the earnings cap. If you are motivated to make money, you will probably find better opportunities outside of the working student program.
Often, “middle-skill” jobs such as working in a call center, as a waiter, as a nurse or paramedic, as a tutor, or as a bar waiter pay better than entry-level jobs. Particularly motivated students can earn even more by working freelance or starting a business.
For students without reliable transportation, an on-campus work-study job can provide a stable income without increasing costs. However, if you have a car or live in a city with good public transit or safe biking options, a higher-paying option may be better for you.
Bottom line
Part-time jobs are a great way to earn money while studying, but they're not your only option. If you're eligible for a part-time job, take the opportunity to work, but look for earning opportunities that allow you to earn more, learn more, or develop better skills.
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