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Paying for College

TheFinancial Aid Process

Financing College

“Can I afford college?”

“How much will it cost?”

“What is financial aid?”

Ask questions…

“What is the FAFSA?”

“When and how do I apply?”

“Where can I get help?”

Sources of Financial AidFinancial aid comes from a variety of sources.

These funds may be merit-based, need-based, or non need-based.

There are two basic types of financial aid:

Types of Financial Aid

gift aid

self-helpaid

Grants

Scholarships

Work-Study

Loans

How to Apply for Financial AidSubmit All Forms Required by the College

FAFSA

Institutional Forms

Other

Note: Communicate with each college to inquire about steps to a complete application.

• FAFSA on the Web

www.FAFSA.ed.gov

• PDF FAFSA

www.Federal StudentAid.ed.gov

• Paper FAFSA

1-800-4-FED-AID

Three Ways to Access the Free Application for Federal Student Aid

How to Apply for Financial AidOther Things to Know About the Process

• Apply early.

• Information reported on the FAFSA is confidential and is used ONLY to determine financial aid eligibility.

• You may be asked to submit documentation to the financial aid office for verification purposes.

• Supplemental applications or forms may be required.

• Keep track of application DEADLINES!

• Keep a copy of everything you submit.

• Reapply every year.

Dependency StatusINDEPENDENT students fit into at least one of the

following categories:

• Born before January 1, 1986 (for the 2009-10 academic year)• Married• Graduate or professional student• Veteran or currently serving on active duty for other than training purposes• Have legal dependents other than a spouse , for whom more than 50% of the

support is provided through June 30, 2010• Orphan, ward of the court, or in foster care when student was 13 or older• Emancipated minor or in legal guardianship as determined by a court in the legal

state of residence• Unaccompanied youth who was homeless or self-supporting and at risk of being

homeless on or after July 1, 2008

** DEPENDENT students must report personal and parental income and assets

New!

Determining Financial Need

A need analysis formula established by Congress determines the student’s Expected Family Contribution (EFC).

• A comparative measure of how much a family can be expected to contribute.

• Used to determine a student’s eligibility for most federal and state assistance.

• Shown on the Student Aid Report (SAR) and Institutional Student Information Record (ISIR).

Tuition & Fees

Room & Board

Transportation

Books & Supplies

Miscellaneous Living Expenses

Cost of Attendance (COA)

+

What are the costs?

To Determine Financial Need

To Determine Financial Need (examples)

Option

AOption

B

COA EFC

Financial

Need

$3,000$10,000 $7,000

$3,000$20,000 $17,000

-

-

=

=

Option

C $3,000$35,000 $32,000- =

• Federal Pell Grant* – up to $4,731

• Federal Supplemental Education Opportunity Grant (FSEOG)* – up to $4,000

• Federal Academic Competitiveness Grant (ACG)* – up to $750 first-year or $1,300 second-year students

• Federal Science & Mathematics Access to Retain Talent (SMART) Grant*– up to $4,000 for 3rd & 4th year

• Federal TEACH Grant Program - up to $4,000

U. S. Department of EducationFederal Financial Aid Programs

* FAFSA Required ** Program Application Required

Federal Work-Study

• Need-based employment program providing on- and off-campus jobs to undergraduate and graduate students

• Compensation is at least the current federal minimum wage

• Student is paid by the college

• The availability of funds is limited; Financial Aid Offices may establish priority deadlines

* FAFSA Required ** Program Application Required

Sourceof

Loan

Repayment~

Grace Period

Interest Rate

Loan Programs

When evaluating loan options, consider…

Know… what you’re signing; what you promised; where your money goes; your loan limits; your rights and responsibilities; loan repayment, deferment & forbearance options; how to manage debt; “Entrance & Exit Counseling” requirements; the consequences of default; and who to contact.

Subsidized vs.

Unsubsidized

Federal Loan Programs (for Undergraduate) Program

* FAFSA Required ** Program Application Required

Type GraceRate

Perkins Subsidized 5%

Fixed

9

Months

Stafford

(2008-09)

Subsidized 6%

Fixed

6

Months

Unsubsidized 6.8%

fixed

6

Months

PLUS Credit-based 8.5%

fixed

Within first

60 days

Note: Stafford Loans (both subsidized and unsubsidized) for Graduate students have a fixed interest rate of 6.8% through 2013.

College Affordability

Financial aid helps make up the difference between what you can afford to pay and the cost of college.

• Don’t underestimate your options.

• Never assume that you’re too poor to attend college or too rich to receive some type of financial aid.

• Don’t become overwhelmed by college cost, it may not be what it seems.

• Consider: private vs. public, in-state vs. out-of-state, community college.

Financial Aid Awards

The financial aid administrator at the college will package all available aid and send an award letter for consideration.

• What is the total cost of attendance?

• What is the Expected Family Contribution?

• What is your financial aid eligibility?

• What types of financial aid are included?

• Was your financial need met?

• What is the out-of-pocket cost?

Financial Aid AwardYou too should have ‘Selection Criteria’

A few points to consider before you commit to a school:

• Type of Institution

• Available Financial Aid

• Cost of Education vs. Earning Potential

• Academic Program Ranking

• Residential vs. Commuter

Avoid Scholarship Scams

View with caution any service that requires you to pay.

While most scholarship services are legitimate, some may be fraudulent and might charge a lot of money for little information.

Report scams to: • Better Business Bureau

• High School Counselor

• Financial Aid Office

• Friends

Steps to Remember

1. Start planning for the future

2. Complete the application process

3. Receive, revise and edit the Student Aid Report

4. Consider award letters

5. Respond to college offers

6. Advise school(s) of outside scholarships

7. Renew the FAFSA every year!