Tag Archives: financial aid

FAFSA, financial aid, financial planning

FAFSA Week: A Step-By-Step Guide to the 2021-22 FAFSA

2021-22 FAFSA

If you break it down, the 2021-22 FAFSA isn’t that complicated. Because it’s a federal form (like income taxes), many parents and students are hesitant to tackle it. If you take it step-by-step, it’s much easier. Here’s a synopsis of the requirements and the sections of the 2021-22 FAFSA.

Information you will need to complete the FAFSA

Use this list to gather all the information necessary before you begin:

  • Your FSA ID, which you can create on fsaid.ed.gov. Note that students and parents will need to create their own FSA ID and keep it private.
  • Your social security number and driver’s license, and/or alien registration number if you are not a U.S. citizen.
  • Your federal income tax returns, W-2s, and other records of money earned.
  • Your parents income tax returns, W-2 forms and 1040 forms if you’re a dependent.
  • Bank statements and records of investments (if applicable).
  • Records of untaxed income (if applicable).
  • Title IV Institution Codes for each school you’re applying to, which you can find from the FAFSA federal school code search.

Sections of the FAFSA

At each online step, a “help and hints” box pops up at the side, in case you need guidance. Here’s a short synopsis of each section from CollegeXpress.

Student eligibility

This is pretty basic: the name of your high school, what year in college you’ll be entering, and your parents’ level of education. This is also your chance to opt into federal work-study. Consider saying yes if you aren’t sure; you can always decline later if you change your mind.  

You will also be asked if you have registered with Selective Service (the military draft). Nearly all men age 18–26, including undocumented immigrants and people with disabilities, are required by law to register—and if you aren’t registered, you will be denied federal financial aid. You can register via the FAFSA form by checking a box.

School selection

Here’s where you enter the names of the colleges you plan to apply to. You can add as many as 10, but don’t worry if you haven’t finalized your list. If you want to add another or make changes, you can do it later.

For each school you include, you will be asked if you plan to live on campus, off campus, or with your parents (because you won’t need funds for room and board if you will live at home). For state aid, some states require that colleges are listed in a specific order; check the federal aid website to see if your own state is fussy about this.

Dependency determination

Colleges want to know if your parents support you or if you are an independent adult. The vast majority of high school students are considered dependent for college financial aid/FAFSA purposes. However, you’re generally considered an independent student if you are:

  • 24 years old by December 31 of the award year
  • A graduate or professional student during the award year
  • Married (or separated)
  • A parent or have other dependents who currently receive more than half their support from you
  • An orphan or a ward of the court
  • A veteran of the US Armed Forces

Otherwise, you are most likely a dependent student.

If your family situation is complex (for example, you are a minor but don’t live with your parents or don’t have access to their financial information), you can find some guidance on the federal student aid website.

Parent demographics

You fill this FAFSA section out if you are a dependent. Aid decisions will consider your parents’ age (because older parents may need to conserve more for retirement), how many children they support, and, most important, if they will have additional children in college that year. Each of these elements affects the calculation for your Expected Family Contribution (EFC), so answer the questions carefully. For example:

  • Older parents are expected to contribute less since they are closer to retirement.
  • Parental contribution is divided by the number of students in college.
  • If the parents are divorced or separated, include only the financial data of the parent with whom the student lives for the greater part of the 12 months preceding the date of the application. If that parent has remarried, the student must include that stepparent’s income and asset data as well. Note: some colleges request information on the “other” natural parent and may expect a contribution from that parent as well.

Financial information

You will need to fill in your parents’ adjusted gross income from the 1040 form, or whichever form they file. (Or your income, if you are independent.)

The IRS Data Retrieval Tool really shines with this part of the FAFSA, because it transfers your tax information directly to the form, saving time and eliminating the chance of a mistake.

You’ll also be asked about assets—both your parents’ and yours. That’s right: the money you’ve saved from summer jobs, birthdays, or bat mitzvah gifts—all of it is fair game. And your colleges will expect you to contribute a percentage of your savings to your college tuition.

Of course, your parents will need to report their savings and investments too, including money market accounts, mutual funds, 529 college savings accounts (yours and any siblings’), and investment real estate (not your family’s primary home).

Qualified retirement accounts—IRAs, 401(k), 403(b), or pension plans—aren’t counted as assets. As always, you can find guidance in the pop-up help boxes at the right side of the page.

Sign and submit

After you’ve finished the FAFSA’s financial section, you add your electronic signature with your FSA ID and hit submit. That’s it.

For a visual step-by-step guide to completing the FAFSA, follow this link:

https://www.nitrocollege.com/fafsa-application

Don’t forget to read the other articles related to FAFSA Week:

FAFSA Week: Debunking 5 FAFSA Myths

FAFSA Week: Financial Aid Q&A

FAFSA Week: 10 Reasons to File

FAFSA, financial aid, financial planning

FAFSA Week: Financial Aid Q &A

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financial aid

Financial aid can be a confusing part of the college application process. Even if you can afford to pay for college, it’s a good idea to learn what aid is available and apply for it. You aren’t obligated to accept it, but most students qualify for some form of aid and, if it’s available, why not use it?

What is financial aid?

Financial aid is intended to make up the difference between what your family can afford to pay and what college actually costs. With college tuition rising rapidly, more than half of the students currently enrolled in college receive some sort of financial aid to help pay for college. The system is based on the premise that anyone should be able to attend college, regardless of financial circumstances. However, students and their families are expected to contribute to the extent that they are able.

There are two types of aid: need-based, and non need-based. Need-based aid includes grants and scholarships that are issued based on the family’s ability to contribute to education costs. Non-need-based aid is allocated solely based on availability, not need.

There are three main types of financial aid: grants and scholarships, loans and work study.

What is “free” money?

Not all aid is equal and the best aid is the aid you don’t have to pay back. It’s like getting a huge coupon of savings to use for your college education.

What types of education loans are available?

Not all college loans are equal.

There are two types of government-based loans: subsidized and unsubsidized. Subsidized loans have lower interest rates and are awarded based on the student’s financial need with interest deferred until after graduation. Unsubsidized loans are awarded without regard to financial need with interest payments beginning immediately and regular payments due after graduation.

What is work study?

The Federal Work-Study Program provides a method for college students to earn funds to be used toward their education. The program is based on financial need and students must be accepted into the program to qualify which is determined by completing the Free Application for Federal Student Aid or FAFSA.

What is the FAFSA and do I need to file it?

The FAFSA is the Free Application for Federal Student Aid and you should apply if you want any chance to receive federal and state student grants, work study, loans or merit-based aid. If you don’t complete the FAFSA, you can’t apply for student loans. Colleges also use these figures when determining financial aid eligibility for grants and scholarships. Plus, many states use your FAFSA data to determine your eligibility for their aid.

The FAFSA is available on Oct. 1 of every year and you should complete it as close to that date as possible in the fall of your senior year. Aid is dispersed on a first-come, first-served basis. The sooner you apply, the more likely you will receive a portion of the financial aid pie.

What is the EFC?

The Expected Family Contribution (EFC) is how much money your family is expected to contribute to your college education for one year. Typically, the lower your EFC, the more financial aid you will receive. Factors such as family size, number of family members in college, family savings, and current earnings (information you provide on the FAFSA) are used to calculate this figure. Once your FAFSA is processed, you will receive a Student Aid Report (SAR) with your official EFC figure.

You can calculate your EFC by visiting FinAid.org.

What is an award letter and how do you use it?

As the offers of admission arrive from colleges, the financial aid award letters will follow. They can be confusing and vague. Added to the confusion is that every award letter is different, making it hard to easily compare them side by side.

Thankfully, there are tools available and information to help you look at these letters for what they are: the college’s pitch for you to accept their offer of admission. You are in control of this process and you hold the cards. It’s your decision to accept or reject their offer based on the amount of aid they are willing to give you. Money, in this situation, is everything.

If a college wants you to attend, they will back it up with money. No money means their offer is probably based on filling a quota and expecting you will decline to attend. And you should. Who wants to attend a college that doesn’t value you as a student?

FAFSA, financial aid, financial planning

FAFSA WEEK: 10 REASONS TO FILE

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fafsa

The FAFSA for the 2021 school year will be available on October 1. The earlier you file, the better your chances of getting some of the money colleges allocate for financial aid. In order to help parents understand the FAFSA and answer some of your questions, this week is FAFSA week.

Surprisingly, many families don’t even take the time to complete the FAFSA. The most common reason is they believe they won’t qualify for financial aid; but nothing could be further from the truth. Most students receive some form of financial aid. If you don’t file, you could be missing out on some of that aid.

Here are 10 reasons to file the FAFSA:

1. College is expensive

Even if you can afford to pay for your child’s education, it’s expensive. Why would you pass up an opportunity to help with some of the cost?

2. It’s FREE

That’s right. It’s completely free to complete the FAFSA. You’ll spend some of your time completing the FAFSA and you could get thousands of dollars of financial aid in return. So one could say, it’s BEYOND free–they pay you!

3. Getting help is easy

If you get stumped, help is available. You can use the online help tool, submit a question on social media, or call the help number. You can even access the Help Center where you will find answers to their most-asked questions. Many schools even host a FAFSA day where they offer help to parents and students on how to complete the free form.

4. FREE money could be waiting for you

According to a recent Reuters article, about 1.8 million lower income undergraduates who might have qualified for aid neglected to file the FAFSA and missed out on financial aid. No matter what your income level, you should file the FAFSA because there is more money out there to be awarded than just need-based aid.

5. Federal aid

The federal government provides over $80 billion dollars in grants, loans and work-study programs every year. The only way to get Pell grants, , Stafford loans, Parent PLUS loans and other federal aid is by submitting the FAFSA. Federal loans offer the best interest rates and repayment terms for student borrowers and are superior to private student loans.

6. State aid

FAFSA is the gatekeeper for state financial aid programs. Each state’s programs are different but they all require the FAFSA to distribute the funds. Check with your state’s higher education agency for deadlines and requirements. In some states the financial eligibility ceilings are much higher.

7. Institutional aid

Colleges and private scholarship sponsors offer billions of dollars in financial aid. Even if you don’t have financial need, you may be eligible for these awards. Some school and private scholarship programs are specifically designed for students who were rejected by federal financial aid. Some schools will not award merit aid unless you complete the FAFSA.

8. Scholarship applications ask if you’ve applied

In addition to the aid that a student may receive from federal and state agencies, many scholarship applications include a box to check asking whether the student has submitted a FAFSA. According to Monica Matthews of How to Win College Scholarships, “Scholarship providers want to know that the student is doing everything possible to get financial help in paying for college and submitting the FAFSA is a very important step in the process.”

9. You have two or more children in college

With two in college, your expected family contribution (what the parents can afford to pay) drops by 50%. Even if you didn’t get financial aid with the first, file the FAFSA because having a second child in college can net you some financial aid.

10. You want to claim a “piece of the pie”

Look at it this way: FAFSA is the ONLY way to be considered for federal, state and college financial aid. Even if you don’t NEED the aid you still want to get it. Who doesn’t want FREE money?

FAFSA, financial aid, financial planning, student loans

A Parent’s Guide to Financial aid

financial aid

Financial aid can be a confusing part of the college application process. Even if you can afford to pay for college, it’s a good idea to learn what aid is available and apply for it. You aren’t obligated to accept it, but most students qualify for some form of aid and, if it’s available, why not use it?

What is financial aid?

Financial aid is intended to make up the difference between what your family can afford to pay and what college actually costs. With college tuition rising rapidly, more than half of the students currently enrolled in college receive some sort of financial aid to help pay for college. The system is based on the premise that anyone should be able to attend college, regardless of financial circumstances. However, students and their families are expected to contribute to the extent that they are able.

There are two types of aid: need-based, and non need-based. Need-based aid includes grants and scholarships that are issued based on the family’s ability to contribute to education costs. Non-need-based aid is allocated solely based on availability, not need.

There are three main types of financial aid: grants and scholarships, loans and work study.

What is “free” money?

Not all aid is equal and the best aid is the aid you don’t have to pay back. It’s like getting a huge coupon of savings to use for your college education. Here are the types of aid you can receive that you won’t have to pay back after graduation:

  • Federal Grants – These are grants given by the federal government.
  • Pell Grant – This grant is given to students with exceptional financial need.
  • College Grants – These grants are awarded by the individual colleges based on financial need.
  • State Grants – These grants are given to students who plan to attend college in their own state (and states are strict about residency).
  • Private Scholarships – There are a multitude of private scholarships available awarded by private organizations and businesses for every type of student.
  • Institutional Scholarships – These scholarships are given by individual colleges based on the student’s qualifications or financial need.
  • Federal Scholarships – Scholarships funded by government agencies.
  • Tuition Waiver – This waiver is offered by colleges to students who meet specific criteria (e.g. child of a POW/MIA)

What types of education loans are available?

Not all college loans are equal.

There are two types of government-based loans: subsidized and unsubsidized. Subsidized loans have lower interest rates and are awarded based on the student’s financial need with interest deferred until after graduation. Unsubsidized loans are awarded without regard to financial need with interest payments beginning immediately and regular payments due after graduation. Following is a brief description of each:

  • Stafford Loan – Government based loans that can be either subsidized or unsubsidized.
  • PLUS (Federal Parent Loans for Undergraduate Students) – This loan is for creditworthy parents and has payments due beginning 60 days after it is disbursed with relatively low interest rates.
  • Private Loan – Loan offered by private lenders usually with higher interest rates than government loans.
  • Institutional Loan – A loan in which the school is the lender.

Once you have chosen the loan that best fits your needs, do the research and educate yourself about repayment, interest rates and grace periods.

To learn more about work study, the FAFSA, the EFC and award letters, read the entire article I wrote for TeenLife Online Magazine here.

financial aid, parenting, scholarships, social networks

8 Facebook Pages and Groups to Help With College Prep

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facebook

Have you ever had a question about college prep and there was no one to ask? Do you wonder what other parents have done in your situation? Is there a question about paying for college that you simply can’t find the answer to?

Odds are, you can find most answers to your unanswered questions on Facebook (or at least a suggestion on who to ask). From parenting a teen through the college process, paying for college, financial aid, scholarships and connecting with college parents, you can find groups or pages to help.

Here’s a list of my favorite Facebook groups and pages:

Grown and Flown

This is a widely popular group for parents of both college-bound and college students. You can connect with experts in college prep here or get advice from other parents who have been through the process and/or have current college students. It’s a friendly, conversational group and if you have a question, it’s easy to post it and usually get an instant response from another parent or expert in the group.

Paying for College 101

If you have a question about paying for college, this group is available to help. Helpful articles are posted daily and questions are answered quickly by experts and mentors on the page. They cover topics related to college prep and often offer training sessions and webinars to help you with the college admissions process.

College Talk

Financial aid can certainly be confusing for parents and students. College talk provides parents with tips and strategies related to college financial aid.

How to Find Merit Scholarships

Looking for merit scholarships? This group is devoted to sharing merit scholarship opportunities and discussing ways to find schools generous with financial aid and merit scholarships.

How to Win College Scholarships

Need help searching for scholarships? Need help with scholarship applications? Have a question about the scholarship process? You capayn find the answer on this page, along with endless lists of scholarships available. Check this page daily for the best in scholarship information.

Parenting for College

This is my page and you can find the answer to any college-related question here. I post informative articles daily and am happy to answer any question you might have about college prep. I also frequently post scholarship opportunities and free training opportunities as well. Check back often to see new news about college admissions.

Parents of High School Students

This is the portal for you to ask any question, raise out any concern or get feedback from the group. This type of forum rarely exists in the college admissions space, but it’s space for parents to expand their network, build connections, establish relationships and form a support system in this competitive field. This is also the place for parents and students to grow and even enjoy their college admissions journey.

College Essay Guy

Everything you need to know about the college essay, personal statements and supplemental essays can be found on this page. From podcast episodes to essay samples to expert advice, the College Essay Guy is available to help. Your student can also join his private group page for personalized essay help: College Admission and Application Forum.

…and one more

College Connections Educational Consulting Services

A page with over 14,000 members offering great college advice, current articles in the news, and a forum for students and parents to comment on them and ask questions. College Connections’ main objective is to have our students gain admission to the college which is their best match, and where they find happiness, success and a solid academic program.

financial aid

Why Complete the FAFSA?

FAFSA

October 1 is on the horizon and that means the FAFSA will be available for students to complete and file. Believe it or not, many students don’t bother completing it and that’s a decision you and your student might regret.

According to the National Center for Education Statistics, Only 65% of high school seniors complete the FAFSA, Why don’t more fill it out? Most either can afford college without financial aid or think they won’t qualify for financial aid. Other reasons include a lack of information — and just planning on skipping college entirely.

FAFSA

Completing the FAFSA is an essential step of the college application.

Why bother completing the FAFSA if you don’t need financial aid?

Even if you and your student can afford to pay for college, why would you pass up free money? Colleges use the FAFSA when distributing merit aid and even some private scholarships require a completed FAFSA.

If you need financial aid, how can completing the FAFSA help?

If you need some form of financial aid to pay for a college education, you MUST complete the FAFSA. In order for students to qualify for federal student loans, state loans, and work-study, they must submit the form. The FAFSA is also required if you plan to take out a Parent PLUS loan to help your student pay for college.

In addition, many students are eligible for federal Pell Grants. High school graduates who didn’t complete a federal financial aid application missed their opportunity for part of $2.6 billion in free money for college, according to NerdWallet’s annual analysis of federal financial aid data.

The money went unclaimed by 661,000 members of the Class of 2018 who were eligible for a federal Pell Grant but didn’t complete the Free Application for Federal Student Aid, or FAFSA.

How much time does it take to complete the FAFSA?

The FAFSA has over 100 questions, which can take anywhere from a half hour to an hour to complete. According to data compiled by Finder.com, new applications less than an hour, averaging 35 minutes. Renewing your application takes even less time — 23 minutes on average. Filling out the FAFSA for the first time takes the longest since you need to fill in answers for each required question.

The bottom line: complete the FAFSA. It doesn’t take that long and most students qualify for some form of financial aid. That doesn’t mean you have to accept it, but why not have that option? And you certainly don’t want to miss out on some of that FREE money!

 

financial aid, financial planning, student loans, Uncategorized

Paying for College: Borrow Wisely

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borrow wisely

I received an email from a concerned parent whose student was going to be attending orientation next week. In the email, he confessed that he might need some help with information regarding financing his son’s college education. I was surprised that he waited so long. Unfortunately, I had to advise him that at this point his only options were private loans and advise his student to apply for scholarships over the summer.

Parents should consider college funding even before their student applies to college. The inevitable result of lack of planning is parents and students borrowing to pay and usually borrowing more than they can repay after graduation.

What do the statistics say?

With school starting shortly, student loan borrowing often appears in the news. It’s especially prevalent now with presidential candidates promising to erase student loan debt. Wherever you stand in the political landscape, it’s clear from the statistics that students have borrowed more than they can repay.

According to a 2018 report by the Federal Reserve Bank of New York, as many as 44.7 million Americans have student loan debt, that’s one in five adult Americans. The total amount of student loan debt is $1.47 trillion as of the end of 2018 — more than credit cards or auto loans.

How do you make wise financial choices?

Before applying to college, you and your student should investigate the cost. You can gather the information either on the college website or by using College Navigator. When viewing these figures, you should also research the college’s financial aid statistics—what percentage of students are awarded aid, how much aid is awarded and how much do students typically borrow. Since every family’s financial situation is different, these figures should help determine if the college is affordable to attend.

How does financial aid play into the equation?

If you complete the FAFSA, your student will receive some form of financial aid. The most common is student loans, but colleges also award grants and merit aid as well. Always complete the FAFSA, even if you don’t think you will qualify for aid. Colleges use the information on the FAFSA when awarding scholarships and grants. No FAFSA, no aid.

What’s the key to avoid borrowing too much?

Use repayment calculators before you sign on the dotted line. The rule of thumb is that students should only borrow as much to pay for college as their first year’s salary. By keeping your debt under one year’s salary, you won’t have to put more than about 10% of your income towards student loan payments. Borrowing more than your student can afford to repay sets them up for overwhelming debt after graduation. Your student can look at salary comparisons for their anticipated career at PayScale.com.

How can you avoid borrowing to pay for college?

The key to not borrowing to pay for college is to receive merit aid, grants, and outside scholarships. Your student should apply to a college at the top of his or her applicant pool. This means the college will be more likely to award aid to attract your student. Grades and standardized test scores are also a key factor in awarding aid. Your student should focus throughout college to pursue excellence in these areas. And, don’t forget outside scholarships. Your student should focus time and effort in applying to every scholarship he or she qualifies for. This means starting early and planning to submit the best application. Click here for scholarship application tips and see how your student can win enough money to pay for college.

Finally, borrow wisely. Only borrow what you need. Your student can borrow the maximum amount, but only borrow what is necessary. Just because you can, doesn’t mean you should. Choose the loans with the lowest interest rates first.

FAFSA, financial aid

5 Questions to Ask the Financial Aid Office

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Keep these questions in mind as you plan your next college visits and take the time to schedule an appointment with the school’s office of financial aid.

1. What are your financial aid deadlines?

In addition to deadlines for the standard financial aid applications: the Free Application for Federal Financial Aid (FAFSA) and PROFILE, the financial aid application service of the College Board, colleges may also have their own deadlines and forms. Be sure to ask if the school’s financial aid forms are different for need-based and merit-based aid when the deadlines are. Note many schools have declared March 1 as their priority filing date for financial aid. Be sure to confirm each school’s priority filing dates.

2. What is your Cost of Attendance (COA) for the current year?

 There are precisely six components to a college student’s complete budget:

  • Tuition
  • Fees
  • Room and Board
  • College Textbooks and Supplies
  • Personal expenses
  • Transportation

Many proposed budgets only include Direct Costs (which are the first three items listed) and typically what you will pay directly to the bursar’s office. However, the U. S. Department of Education requires that colleges fully inform you as to all of the above costs, so find out specifically what those amounts are to establish a complete budget for college expenses.

3. How much of an increase in the COA do you project for next year?

When you ask this question, be sure to request the specifics related to each cost component. Tuition and Room and Board increases are independent of each other. For example, one school may expect an increase of 5 percent in tuition and fees, but a 10 percent increase in Room and Board. This information will help with budgeting but also gives the financial aid officer the impression that you are an informed parent.

4. Are you able to meet 100 percent of financial need?

If they say “No,” find out why, and get details. Is the policy based on “first come, first served?” What’s the average percentage of need the school can meet? What percentage is in the form of grants and how much is in the form of loans? Is there a dollar amount left as a gap (unmet need) for everyone? Do they include Parent Loans (PLUS) in the aid package?

(Note: They shouldn’t do this…those loans are to be used for your EFC-Expected Family Contribution, not for meeting the financial need of the student.)

5. Do you offer Merit Scholarships, and how do you treat private scholarships awarded to the student?

If a Merit Scholarship is being awarded, it normally goes into the financial aid package first, reducing the amount of need-based aid. Find out if a merit award reduces the self-help in the package, or if it replaces other need-based grants. A true Merit Scholarship can go beyond the “need” level, which means that it can lower your EFC. 

financial aid, Guest Posts

How to Prioritize Your Financial Aid Options in College

As the costs of college keep rising each year, many students and their families find it necessary to rely on financial aid to help pay for college. There are many different types of financial aid available, and knowing which one best matches your situation is key to not only choosing the right type of aid, but also maximizing the amount that you can qualify for—and minimizing your debt obligations later on.

Financial aid is a critical part of the college application and attendance process. It can make college a reality for many students and help bridge the gap between family contributions and the overall cost of attendance. Some types of aid don’t need to be paid back; others can leave you in debt for years to come.

With that in mind, it’s important to understand how to best approach the financial aid process, and how to set yourself up for financial success later by putting thought into the process now.

What Should You Start With?

The first step in the financial aid process should be completing the FAFSA. Short for the Free Application for Federal Student Aid, the FAFSA walks you through a complete picture of your finances. If you’re a dependent student—most first-year students are—then it also includes questions about your parents’ financial situation and their potential ability to assist in funding your education.

The federal government is the biggest source of financial aid for college students, and before it’ll consider you as eligible for aid, you’ll need to complete the FAFSA, which serves as your application for all federal aid. The FAFSA is completed online, it’s free, and there is plenty of help available to assist you and your family in filling it out.

What’s the Takeaway from the FAFSA?

Once your FAFSA is submitted to the federal government along with your choices of colleges, a Student Aid Report, or SAR, is generated from the information you entered. The SAR explains how much your expected family contribution (EFC) is. The government takes the position that it’s your responsibility to pay as much as you can to your own education first; the EFC is how much the Department of Education thinks you and your family should be able to contribute to the total cost.

Each year, colleges publish an amount called the cost of attendance. It includes all the expenses that go into attending that school: tuition, room and board, textbooks, fees, and other things like living expenses throughout the school year. Your EFC is subtracted from the Cost of Attendance, and the resulting balance is considered your financial need. The federal government sends your SAR to the schools you listed, and they compile a financial aid package to offer you.

Your federal financial aid package could include a variety of aid products including Pell grants, unsubsidized and subsidized federal student loans, and more. You should always consider Pell grants and subsidized federal aid first. A Pell Grant is a type of aid that does not require repayment, and subsidized loans do not accrue interest while you’re attending school.

After looking at your offer, you may find that your financial aid package isn’t enough to cover the entire bill, but there are other options to consider such as scholarships.

Should You Consider Scholarships?

The short answer is “YES, absolutely!” Scholarships, like grants, are essentially free money that you don’t have to pay back. They should always be a consideration regardless of what year you are in college. You can apply for new ones every year, and there are tons of sources to find scholarships. They can really make up the difference up between the cost of attendance and your financial aid package. Start early and often. If the FAFSA wasn’t so important, this would be the first place to start.

There are thousands of scholarships available every year, but they’re highly competitive. Each program has its own application criteria and deadlines, and the best way to maximize your chances of winning one is to ensure that you follow the program’s directions and meet all of the deadlines—preferably applying as early as possible. The best way to go about winning scholarships is to just keep on applying to any legitimate opportunity you can find.

Is There a Last Resort?

If you find there’s a funding gap left over after scholarships, grants, and other federal aid, then you still have one option: a private student loan. There are distinct differences compared to federal student loans do, but sometimes they’re a necessary tool to cover that funding gap.

Offered by banks, credit unions, and other lenders, private student loans are based upon your creditworthiness; as a result, most students find that they need a qualified cosigner for approval. Further, you may find even the best private student loans still have high interest rates compared to federal loans. After all, interest rates are generally higher for private loans. Also, they don’t come with a grace period like a federal loan. That means you’ll need to start paying it back immediately, just like a car loan or mortgage, even if you’re still in school.

It is clear that private student loans are not as desirable compared to their federal counterparts; however, sometimes they’re a viable option if it’s crunch time.

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Today’s guest post is By Matt, the site manager & webmaster of The Student Loan Report – a student loan news and education website.

financial aid

What is a Financial Aid Footprint?

If receiving financial aid is the key to attending college, you might want to look at your college’s financial aid footprint. Every college reports the statistics related to their financial aid profile. These statistics can tell you how generous they are with their scholarships and grants and also the percentage of students who receive help with their tuition. It will also help you determine if you should ask for more merit aid when you receive your financial aid package. If a college is not generous with aid and your student receives some, it’s unlikely they will award more.

The best resource available for these statistics is College Navigator. You can enter the name of the college, or search using criteria such as location, size, and degree plans. Once you’ve pulled up the data, you can use it to compare colleges.

Below is a screenshot of just one university, Ohio State:

financial aid

As you can see, 67% of the full-time beginning undergraduate students receive aid in the form of grants or scholarships; 70% of that aid is from institution grants and scholarships. Also notable, the average amount of aid received in the form of grants or scholarships per student is $9,275. Total tuition/room and board is $27,037 for in-state, on campus students. Therefore, 1/3 of tuition, room and board is covered in the form of grants and scholarships.
covered in the form of grants or scholarships.

financial aid

Another valuable part of the information available includes the average net price broken down by household income:

All of this information will help you determine a college’s financial aid footprint and give you the much-needed data you will need to make the wisest financial choice. Finding the college with the best financial aid is part of finding that perfect fit college.

In addition, you can connect with the College Affordability and Transparency Center  provided by the federal government to determine which colleges are the highest and lowest priced and which offer the best value.