Crowdfunding College Tuition: Cash-strapped Students Try a Startup Strategy


Crooks have found all kinds of ways to launder money with crowdfunding scams. CSA-Archive/JoosMind/GettyImages  (c) 2015 HowStuffWorks
Crooks have found all kinds of ways to launder money with crowdfunding scams. CSA-Archive/JoosMind/GettyImages (c) 2015 HowStuffWorks

May 1 is National College Decision Day, the final day for American high school seniors to commit to a college or university by mailing in a deposit. For many students and their families, it's a day to celebrate years of hard work and look ahead to a bright future. At the same time, a growing number of families are wondering how to pay for college. And that has meant coming up with some innovative strategies.

One of those is crowdfunding. 

The skyrocketing cost of college is shocking. Between 2000 and 2016, tuition and fees at public, four-year U.S. colleges have increased 94 percent. Blame state budget cuts that have slashed public education funding. Blame pricey campus upgrades like rock walls and lazy rivers. But the results are the same: Today's students pay more for college and owe more student loan debt — $35,000 on average per borrower — than ever before. 

It's enough to make a desperate high school senior take to the street corner with a tin can and a handwritten sign. Yup, 18-year-old Emily Stutz panhandled for college tuition in her hometown of Lowell, Massachusetts, to draw attention to her financial plight and that of millions of college hopefuls. The stunt garnered international news coverage and directed empathetic readers to Emily's GoFundMe page, where the elated senior has received more than $24,000 in donations, mostly from complete strangers.

Panhandling for tuition is certainly extreme, but Emily's not the first cash-strapped student to turn to crowdfunding websites like GoFundMe for help with college tuition. Kelsea Little, media director at GoFundMe, says that fundraising campaigns in the site's Education, Schools & Learning have raised more than $100 million since the crowdfunding platform launched in May 2010.

To be fair, not all of the campaigns listed in GoFundMe's education section are for college tuition. There are plenty of middle school science teams raising cash for a trip to the big competition as well as memorial scholarship funds. Little was unable to share what percentage of campaigns on the education site were for college tuition or were fully funded. She did point out that campaigns at GoFundMe had no expiration date and fundraisers didn't have to meet their goals to keep the money donated.

A significant number of college tuition campaigns have launched on GoFundMe and similar crowdfunding sites like Generosity, DreamFund and PlumFund. And most of them tell a similar story: a hardworking kid who has good grades, is passionate about becoming a doctor/actor/architect, but who lacks access to low-interest federal student loans. Some are children of undocumented immigrants who are ineligible for federal student loans. Others have maxed out their federal loans and can't get private loans because they have no one to co-sign for them.

We talked to Ajifanta Marenah, a 19-year-old Bronx resident originally from the The Gambia in West Africa, who launched a GoFundMe campaign for $700 to cover the enrollment deposit for her first semester at St. John's University. Marenah, a standout student at the New Visions Charter High School for Advanced Math and Science, panicked when she realized that her scholarships wouldn't cover the room deposit, and that it was due in just two weeks.

Marenah considered writing emails to her principal, teachers and the staff at New York Presbyterian Hospital where she interned last summer, but then she remembered the GoFundMe posts that she'd seen on Facebook.

"A GoFundMe campaign felt better than asking people directly for money," Marenah says. "This way they don't have to feel obligated, plus they can share it with family and friends on social media."

Which is exactly what happened. In just two days, Marenah raised the full $700 — plus $75 for good measure — mostly from school and hospital staff, but also from their extended families. The extra $75 will help pay for the fees charged by GoFundMe and the credit card processing service WePay — a total of 7.9 percent plus 30 cents per donation.

Would Marenah use a crowdfunding site again? She says she would. Even with two hard-won scholarships, including a prestigious award from The New York Times, she'll still need to cover $8,000 a year in tuition and fees. It's safer than panhandling.