I get a lot of families asking about financial aid. Here are the types of financial aid available (your award letter will be a combination of these):
Grants
A grant is a gift given on the basis of financial need. By completing the FAFSA, a student is automatically considered for grant funds from the federal government, state, & often the school itself. The main need-based grants are from the federal government. There are Federal Pell Grants, Federal Supplemental Educational Opportunity Grants (FSEOG), Federal Perkins Loans.
Loans
Student loan programs allow you to borrow money at low interest rates to help pay for your education. They must be repaid. Generally the repayment of student loans is deferred until after you complete your education. The loan amount will depend on your families need.
Work-Study / Student Employment
Work-study allows a student to hold an on-campus part-time job or an off-campus community service position. While priority consideration for campus employment is given to students who show financial need, most students are eligible for employment on campus.
Athletic Scholarships
A scholarship is a gift given in recognition of athletic achievement. DI, DII, and NAIA schools may offer athletic scholarships. DIII schools do not offer athletic aid.
Specific School Scholarship and Award
Scholarships are merit-based awards given to more than 90 percent of incoming college freshmen. The funds are awarded based on academic achievement, community activities, school involvement, religious affiliations, ethnic or racial heritage, artistic talents, career plans or field of study, special hobbies and/or interests. Many Division III schools have large endowments for this purpose. Most of the time, freshmen are automatically considered for these awards by completing the admissions process. Most schools also offer additional scholarships that you may apply or interview for. Always look into the school for scholarships that you qualify for. Students can apply for these scholarships once they have applied and been accepted. The earlier you apply the better!
Additional/Outside Scholarships
Students receive millions of dollars annually in private scholarship awards. Sources include local foundations, community agencies, corporations, clubs, civic, social and fraternal organizations, parents’ employers and other groups. You must apply and search these scholarships out. A great website is finaid.org. The www.fastweb.com service offers a free, personalized and comprehensive list of scholarships that might fit your circumstances. An alternative service, also free, is offered by www.collegeboard.com.
April is typically the month when financial aid award letters arrive in the mail, although more often they are coming a short while after you have applied/been accepted. These letters detail how much aid you will receive from each school. Financial aid packages can influence your school choice, and obviously, you want to get the best package possible from each institution. Ideally, you should complete a FAFSA after your parents have completed their 2007 tax return, but don’t wait until next April. Many colleges award aid on a first-come, first-served basis. You should file the FAFSA early as possible and get your financial aid information to your schools of interest. You may submit the FAFSA starting Jan 1st, 2008.
FAFSA Web Address:
<a href =”www.fafsa.ed.gov“>www.fafsa.ed.gov</a>
Financial aid estimators and calculators are available to help you before you file your FAFSA. They will tell you what your expected out of pocket costs will be for college. This is called your Expected Family Contribution (EFC). Also, almost every school has their own financial aid website with detailed information.
There is an estimator available at the following link:
<a href =”http://www.finaid.org/calculators/finaidestimate.phtml“>EFC Calculator</a>
Whatever your family’s EFC turns out to be, will make a big difference in the amount you are expected to contribute to college. So think of the EFC as the amount of money you will be expected to come up with for school (to which academic/athletic scholarships will be added). The Cost of Attendance or (COA) is the total cost of a college.
For example: Let’s say your EFC is $10,000
School “A” costs $40,000/yr
40,000 (COA) -10,000 (EFC) = 30,000 (your need)
School “A”s financial aid office should come up with 30,000 in need-based aid for you. That could be in grants (federal, state, school), work-study, student loans.
The award letter may look like this:
5,000 Work Study
2500 Loan
7500 State Award
15,000 Federal Grant
30,000
School “B” costs $15,000/yr
15,000 (COA) -10,000 (EFC) = 5,000 (your need)
School “B”s financial aid office should come up with 5,000 in need-based aid for you.
The award letter may look like this:
2,500 Loan
2,500 Work Study
5,000
If both of the schools above covered all of your “need” with grants then they would cost the same amount to attend. That means an expensive out of state private school could end up costing you the same amount of money as an in-state public school! If your EFC is lower than the cost of the school, you should be eligible for some type of need-based aid. Alternatively, not all schools will fund all of your need. Grants are the best form of aid because they do not need to be paid back!
The important thing to remember is that there are many ways to finance your education. Don’t assume you are not eligible for financial aid because your family has a certain income level. Many factors other than income are used to determine your ability to contribute to the cost of your education.