The Fafsa Is A Prerequisite For Federal Loans
Even if a student will not qualify for grants, filing the FAFSA makes them eligible for low-cost federal student loans, which are usually less expensive than private student loans. Even wealthy students will qualify for the unsubsidized Federal Direct Stafford Loan and the Federal Parent PLUS Loan. The Federal Stafford Loan is a good way for the student to have skin in the game, since they are unlikely to over-borrow with just a federal student loan.
Figure Out Your Financial Need With The Fafsa
The point of the FAFSA is to help schools figure out your financial need. Thats right: The school determines what kind of federal financial aid package you get.
How much you need is decided by comparing your Expected Family Contribution with the cost of attendance at your school. Heres what you should know about it, along with some other key points:
Appeal For More College Financial Aid
Have you been working hard to save for your education? Did not know that certain circumstances might affect how much aid they can give you on the FAFSA. There are special circumstances that may change in a short period of time, such as job loss or child care changes. If this happens and it affects your familys ability to pay then contact them immediately so they can review their decision with professional judgment before things get worse!
How To Qualify For More Financial Aid During Covid
This post was updated on February 12, 2021. It was originally published on May 19, 2020.
Repercussions of the Pandemic: College Enrollment and Financial Aid
In a Discover survey from the early stages of the pandemic, 48% of parents said they lost income, and 44% said they were not able to pay for college with the amount they originally planned.
Combine the financial turmoil and apprehension of these families with colleges scrambling to put contingency plans in place, and its not much of a shock to find out that undergraduate enrollment declined across the board by 3.6% in 2020.
Although the job market and economy have started to rebound and colleges have gotten a better handle on things, there is still a great deal of uncertainty regarding the future. Both families and schools are still very much experiencing the financial fallout of COVID-19.
Silver Linings: FAFSA Awareness and The Rise of the Appeal
The survey mentioned above found that nearly 40% of parents who didnt plan to apply for federal aid decided to do so as a result of the pandemic. Many families are also realizing the power of the financial aid appeal: the number of financial aid appeals is expected to rise dramatically for 2021.
If your familys financial situation has changed drastically due to the financial crisis brought on by the COVID-19 pandemic, you may be wondering how that impacts your ability to qualify for scholarships, grants, work-study, and student loans.
Qualifying For The Fafsa: Basic Eligibility Requirements
Start by reviewing and understanding the basic eligibility criteria for federal financial aid. At minimum, you must:
- Be a U.S. citizen or an eligible noncitizen and have a valid Social Security number.
- Have a high school diploma or GED certificate.
- Be enrolled or accepted as a student in an eligible degree or certificate program.
If youre unsure if youre someone who qualifies for the FAFSA, check with a college counselor at your high school or reach out to the financial aid office at the colleges youre interested in. For residents who arent U.S. citizens, for example, your eligibility might depend on your specific immigration or visa status.
Certain aid programs have additional qualifying criteria. To get federal direct student loans, for instance, you must be enrolled in school at least half-time. Some types of financial aid require you to show financial need, like direct subsidized loans, while others, such as direct unsubsidized loans, do not.
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Know How Your College Counts Home Equity In A Schools Formulas
Certain institutions count home equity in their own financial aid formulas others dont. Ask your school to know for sure. If home equity doesnt count, some families pay down their mortgage balances in order to diminish cash assets on hand at the time they fill out the FAFSA and other forms, such as the CSS Profile, which some schools require. Reducing cash assets and available savings may help families qualify for more financial aid.
What Are The Different Types Of Financial Aid
When looking at financial aid, its important to get a better understanding of the different types. There are two main kinds of financial aid: need-based and merit-based.
Need-based Aid:Need-based aid is exactly what it sounds likeits based on your financial need and is calculated using the FAFSA. There are a couple of types of need-based aid: federal grants, institutional grants, loans, and work-study.
Merit-based Aid: Merit-based aid depends on your academic and extracurricular achievements with no regard for financial need. By building a strong academic and extracurricular profile, you can increase your chances of receiving this type of aid.
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How Can I Get Financial Aid
The federal government distributes aid to learners who demonstrate financial need. Eligible students possess U.S. citizenship or a qualified alternative.
To qualify for federal aid, students must complete the FAFSA. After gathering things you need to fill out the FAFSA, most individuals complete the form in less than one hour.
Recipients of federal financial aid must take steps to stay eligible. Students must reapply for federal aid each year.
What Is Financial Aid
Most students dont have the ability to pay for college out of pocket. Considering tuition, books, room and board, and other related fees, the cost can be substantial. Not surprisingly, most students need to research financial aid options.
Financial aid consists of a variety of components that help students pay for college, such as scholarships, grants, loans, and work-study programs. Although some types of aid do not need to be paid back, others do.
It wasnt until I talked to Rebecca that I learned that financial aid does not always equate to free money.
Its absolutely possible to qualify for grants, which are essentially free money, Rebecca said, but most of the time, accepting financial aid means taking out federal loans.
I suddenly felt ripped off. No oneNO ONEever told me that financial aid meantstudent loans. Having been raised to live debt free myself, the idea that student debt may be masquerading under a friendlier title didnt sit well with me.
If financial aid is just a loan, I asked, how is it any better than getting a private loan to pay for college?
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Do Colleges Take Into Account Medical Expenses In Financial Aid Calculations
According to the Federal Student Aid office, some colleges offer extra financial aid to students with high medical bills. After submitting the FAFSA, applicants should contact their school’s financial aid department. They should provide documentation for medical expenses and insurance contributions.
Colleges may even consider major dental expenses when calculating financial aid. Donor contributions often allow schools to support students experiencing financial burdens.
Tip #: Apply For Financial Aideven If You Dont Think Youll Qualify
Too often, we see families miss out on the opportunity to get federal aidnot because they wouldnt qualify, but because they didnt apply in the first place! Dont be one of the students who pay more for their education because they didnt apply for federal aid.
The FAFSAthats Free Application for Federal Student Aidbecomes available for the next school year on October 1. Make plans to complete it!
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Borrow Strategically Through Student Loans
For some students, financial aid is the only reason they can complete a degree rather than dropping out of college. For others, financial aid helps them leave school with some student loans but limits the debt to a manageable amount.
If you still have a gap between financial aid and the total cost of attending college, student loans can be an option to make up the difference.
Listed below are the types of loans you might see on a financial aid award letter. Its generally best to prioritize the loans listed first :
Be smart and strategic about how you use student loans. Borrow only what you need to cover college costs after using all other aid.
How To Get Merit
Colleges that offer merit aid generally offer it to students whose GPAs and test scores put them in the top third of the current freshman class. But other factors, such as strength in the arts or sports, may also lead to awards. The application process may be as simple as checking a box on the admission application or may require filling out a separate application.
It’s a good idea to familiarize yourself with a colleges financial aid policies as well as the merit scholarships they offer. Many colleges list merit scholarships on their website.
You can get an idea of how much a college awards in financial aid to students each year by viewing its CollegeData College Profile.
Image Source: Kenyon College Profile
In this example from the College Profile for Kenyon College, you can see that in 2018-19, the college awarded an average aid package of $44,844, consisting of $41,663 in need-based scholarships and $4,039 in loans and work-study, on average. The average merit-based scholarship Kenyon awarded to students who had no financial need was $13,350.
Learning as much as possible about financial aid is one of the most important things you can do as you apply to college. Understanding the different financial aid policies colleges follow can prevent you from applying to colleges that are financially out of reachor discounting expensive colleges that, with the right combination of self-help and gift aid, you and your family might be able to afford.
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Federal Pell Grant Application
This is the first time that the Federal Government is using AI to help with application for student aid. It offers funding for low-income students and works with universities to make sure that they are applying for the correct types of grants. If you think about it, this must be a good thing, since it will save time and fafsa pell grant efforts. This is a comprehensive guide for filling out a federal grant application. The guide covers the most commonly used sections of the application, including: Course is the only way to get the money for college. It is probably one of the most important thing in life, but it is still hard to make sure that you will get it without heavy financial pressure. Make sure that you are in charge of your federal funding, and make sure that you are not paying for any unnecessary costs or fees. Also, make sure that there are no mistakes with your application form. Fill out all forms completely and honestly.
Treat Applying For Scholarships Like A Job
Students should make applying for scholarships a part-time job, Randolph said. There are many college scholarships out there, and you might have a better chance at qualifying than you think.
While many are granted based on academic performance, not all are. Many simply have a minimum GPA requirement or have other eligibility considerations that can be relatively easy to meet.
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Ensure That You Can Apply For Financial Aid In Future Years
Some colleges have a policy that prevents students from applying for financial aid if they do not apply as a first-year. This means that you could end up in in a difficult situation if your family situation changes. For example your family financial situation could change rapidly if one of your parents loses their job or a sibling enters college.
There Are Resources And Support To Help You Apply For Financial Aid
There are affordable college and career training opportunities for everyone. The first, best step is to apply for financial aid. Not sure where to start? Talk to someone you can trust:
- The 12th Year Campaign is hosting virtual financial aid info and filing events to help students and families apply for college and financial aid.
- Are you a high school student? Your counselor can answer questions and direct you to resources.
- Talk to the financial aid office at any colleges you’re interested in attending. Whether you’re an adult thinking about going back to school or a high school student considering your options, financial aid staff can help you navigate the process based on your circumstances.
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How Do I Apply For Fafsa
You can now apply for FAFSA using the free myStudentAid app, available on Apple and . If you use the app with an Apple device, be sure to disable the smart punctuation feature before filling out the form to avoid errors. You can also apply for FAFSA online at FAFSA.ed.gov.
You can still send in your application via snail mail, but this is not recommended for several reasons: Online applications are simpler to complete and generally have fewer errors because they are designed to detect common mistakes and/or typos. Your application is also likely to be processed sooner when its submitted online. Finally, when applying for FAFSA online, you will be given the option to have your IRS data automatically retrieved and then populate the relevant fields, significantly lowering your chances of errors in your tax reporting.
Review The Types Of Federal Student Aid Are Available
While there are no overall FAFSA income limits, the type of aid youre eligible for and whether you qualify for need-based financial aid will depend on your familys finances.
Even if you dont think you qualify for need-based aid, though, it makes sense to fill out the FAFSA to see if you can get non-need-based aid. You have to complete a FAFSA each year to keep receiving federal student aid.
Below are the types of federal financial aid you can obtain as a result of filling out the FAFSA:
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How You Could Lose Fafsa Eligibility
Youll no longer qualify for aid if you cant meet the basic eligibility requirements listed above. You could also lose eligibility if you:
Dont maintain satisfactory academic progress in your program, according to your schools standards. This might include a grade-point average minimum or number of credits completed.
Learn More About How To Pay For College
My conversation with Rebecca was more helpful than I could have hoped for, but it left me perturbed. When grant money is so difficult to come by and loans are so easy, it can be tempting to assume student loans are the best way to pay for college.
But thats just not true.
At Accelerated Pathways, we believe college shouldnt be a debt sentence. We help students avoid the need for student loans altogether by lowering their college costs through the use of affordable online courses. Id encourage you to make a smart financial decision and avoid federal student loans. Learn more about how Accelerated Pathways can help you save money on your education and graduate debt free.
Special thanks to Rebecca Decker, one of our amazing admissions counselors, for taking the time to chat with me about this topic.
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Ways To Maximize Your Financial Aid For College
In a perfect world, you could simply apply to the schools of your dreams and, upon acceptance, choose which one to attend. For most applicants, however, the process isnt so straightforward. In particular, the expense of college is an important factor to consider.
Students rarely pay the sticker price for a college education. Thats what scholarships and financial aid are for! Eighty-six percent of undergraduates receive financial aid! And the average aid award is $14,940. To get the best possible aid package, youll need to be strategic. Here are four proactive steps you can take to maximize your financial aidand minimize how much you pay for college.
Review Your Aid Packages
College acceptance season means that students will get big envelopes full of congratulations letters and financial aid package summaries. Each school’s offer will differ and the amount of loans, grants, scholarships and work-study provided to the same study can vary greatly from school to school.
“Review and evaluate each financial aid package thoroughly before deciding your course of action,” Kat Cohen, CEO and Founder of college guidance company IvyWise, tells CNBC Make It. “Make sure you note the amount of aid you receive through grants and scholarships, which you will not have to pay back, versus loans, which are borrowed money that you will have to ultimately repay.”
There are three main figures that students need to consider when assessing their financial aid packages.The first thing that students need to look for is the expected family contribution, this is the amount that families will be expected to pay out of pocket and it can vary from school to school. Next, students should calculate how much gift aid funds that do not need to be repaid each school is offering. Third, students should look at how much in loans each school expects a student to take out. In an ideal situation, students will want a low expected family contribution, a high level of gift aid and a low level of student debt included in their financial aid package summary.
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