Short answer: check grant and training money before you borrow. Since July 1, 2026, Pell Grants can be used for eligible short workforce programs (U.S. Department of Education). Workforce training funds may be available through an American Job Center, and an employer's educational assistance program can pay up to $5,250 a year that is excluded from your wages (IRS Pub. 15-B). If you still need to borrow, compare federal student loans first; that comparison is in federal student loan vs personal loan.
Step 1: ask whether the program is eligible for federal aid
Workforce Pell lets Pell Grants be used for short programs that prepare people for jobs in as little as 8 weeks (U.S. Department of Education). An eligible workforce program must last at least eight but fewer than 15 weeks of instruction and consist of 150 to 599 clock hours (or the credit-hour equivalent), and the Department of Education approves programs on a rolling basis after a school applies (Federal Student Aid). Not every short program qualifies, so ask the school directly whether this program is approved for federal student aid, and fill out the FAFSA if it is.
Step 2: WIOA training funds through an American Job Center
Under the Workforce Innovation and Opportunity Act (WIOA), training services may be available to employed and unemployed adults and dislocated workers who, after an assessment at a one-stop center, need training to get or keep a job that leads to self-sufficiency, choose a program linked to jobs in the area, and cannot get grant help from other sources such as Pell Grants (20 CFR 680.210). The rule says training is typically paid through an Individual Training Account with a training provider on the state's eligible list (20 CFR 680.300). Find your nearest American Job Center with the CareerOneStop locator (CareerOneStop).
Step 3: ask your employer
An employer can exclude up to $5,250 a year of educational assistance it provides under a written educational assistance program from your wages; amounts above that, or paid without such a plan, are generally taxable wages unless they count as working condition benefits. The covered costs generally include tuition, fees, books, supplies and equipment, but not tools you keep or lodging, meals or transportation. The 2026 edition of this IRS publication notes that the $5,250 exclusion was made permanent for payments after 2025 (IRS Pub. 15-B). This is general information, not tax advice.
Watch the financing the school offers
- An income share agreement asks you to pay a percentage of your income for a set time or until you reach a cap. In 2021 the CFPB took action against an ISA provider that falsely said its ISAs were not loans, and said that whatever the label, these products are credit and must follow federal consumer protections (CFPB).
- Ask for the APR, the total you could repay, any prepayment penalty and what happens if you leave the program, in writing, before you sign.
- Compare any school financing with federal aid and with an outside loan before you commit.
If you still need to borrow: what it costs
Example only, our calculation: $4,000 borrowed and repaid in 24 equal monthly payments, no fees, at the August 2026 averages of 11.90% for a 24-month personal loan and 22.36% for credit card plans (Federal Reserve G.19). Your own rate depends on your credit and the lender.
| Monthly payment | Interest | Total repaid | |
|---|---|---|---|
| Personal loan, 11.90% APR | $188.11 | $514.64 | $4,514.64 |
| Credit card, 22.36% APR | $208.22 | $997.28 | $4,997.28 |
Loan payment: P x r / (1 - (1 + r)-n), r = APR / 12, rounded to the cent. A card payment depends on your card's minimum payment rules; this example assumes you pay the same fixed amount each month until the balance is gone. Ask when the first payment is due; if it falls while you are still in training, check that the payment fits your budget before the new job starts.
Related: federal student loan vs personal loan and how to check if a lender is licensed.
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Disclosure: Modern Lending Solutions is not a lender, loan broker or agent for any lender or loan broker, and does not make credit decisions. Any compensation we receive is paid by participating lenders, only for advertising services. This guide is general information, not financial or legal advice.
Sources
- U.S. Department of Education: Final rule to create the new Workforce Pell Grant program (May 18, 2026)
- Federal Student Aid: Workforce Pell Frequently Asked Questions (October 2026, PDF)
- 20 CFR 680.210: who may receive WIOA training services
- 20 CFR 680.300: how WIOA training services are provided (Individual Training Accounts)
- CareerOneStop: Find American Job Centers
- IRS Publication 15-B: Employer's Tax Guide to Fringe Benefits (2026)
- CFPB: CFPB takes action against student lender for misleading borrowers about income share agreements (September 7, 2021)
- Federal Reserve: G.19 Consumer Credit (released October 7, 2026), terms of credit, August 2026: credit card plans and 24-month personal loans