Financial Aid 101

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Financial Aid 101

• High School Financial Aid Night Presentation
• 2010-11
• Presenter Kim Bennett

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Topics We Will Discuss Tonight
What is financial aid? What is the Cost of
Attendance? What is the EFC and how is financial
need calculated? Where does financial aid come
from? How to apply for financial aid, including
FAFSA how to avoid errors Closing and Questions
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What is Financial Aid?

• Financial aid is funds provided to students and
  their families to assist them in paying for
  postsecondary education expenses.

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What is Cost of Attendance (COA)?
Direct costs (pay to the school) Tuition
Fees Room Board Indirect costs (costs
associated with attending school) Books
Supplies Transportation Miscellaneous personal
expenses Off Campus housing Direct and indirect
costs are combined into the total cost of
attendance Vary widely from college to college
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What is the Expected Family Contribution (EFC)?
Two components Parent contribution Student
contribution Calculated using FAFSA or
FAFSA4Caster data and a federal formula. Main
components are Family size in college Students
income/assets Parents income/assets Amount the
family can reasonable be expected to
contribute Stays the same regardless of college
choice Colleges use EFC as an index to award
financial aid
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What is Financial Need?
Cost of Attendance (COA) - Expected Family
Contribution (EFC) Financial
Need Financial need will vary based on the COA
at each school that you wish to attend while the
EFC will remain the same
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Financial Need COA-EFC
College A COA - 46,246 EFC -
4,500 Need - 41,746 COA -
Variable EFC - Constant

• College B
• COA - 21,174
• EFC - 4,500
• Need - 16,674

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Types of Financial Aid
Grants Scholarships Loans Employment
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Sources of Financial Aid

• Federal Government Programs
• State Government Programs
• Institutional Programs
• Community Programs
• National Programs
• Parental Employers
• www.fafsa.gov
• www.studentaid.ed.gov

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Common Federal Aid Programs

• Federal Pell Grant
• Academic Competitiveness
• Grant (ACG)
• National Science and
• Mathematics Access to
• Retain Talent Grant (SMART)
• Teacher Education Assistance for College and
  Higher Education (TEACH Grant)

• Federal Supplemental Educational Opportunity
  Grant
• Federal Perkins Loan
• Federal Work-Study
• Stafford Loans
• PLUS Loans

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You may be eligible for aid, but...

• You must apply to find out!
• Everyone will be eligible for some type of
  financial aid.
• Apply it is FREE!

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How to Apply for Financial Aid

• Easy as 1-2-3

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Free Application for Federal Student Aid (FAFSA)

• A standard form that collects familys
  demographic and financial information used to
  calculate the students EFC (available in English
  and Spanish)
• How to apply
• Paper FAFSA
• FAFSA on the web at www.fafsa.gov

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Dependent vs. Independent Students

• At least 24 years old by Dec. 31st of award year
• Graduate or professional student
• Married
• Has children or dependents (in which the student
  provides over 50 of their support)
• Veteran of the U.S. Armed forces or currently
  serving on active duty
• At age 13 or older, both parents deceased, in
  foster care or a ward/dependent of the court
• Emancipated minor (determined by court in state
  of legal residence)
• In legal guardianship (determined by a court in
  state of legal residence)
• Homeless

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Why complete the FAFSA?
Federal Student Aid uses the data on your FAFSA
to calculate an Expected Family Contribution
(EFC). The EFC is an indicator of your familys
financial strength to pay for education after
high school. The EFC is not the amount of money
that your family must provide. Rather, you should
think of the EFC as an index that colleges use to
determine how much financial aid (grants, loans,
or work-study) Your application results are
transmitted to the school(s) listed on your
FAFSA, and the school(s) uses the EFC amount to
determine the amount of financial aid that you
are eligible to receive. Many states and schools
also use the FAFSA data to award aid from their
programs.
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When do I need to file the FAFSA?

• May be filed at any time during an academic year,
  but no earlier than the January 1st prior to the
  academic year for which the student requests aid
• For the 2010-11 academic year, the FAFSA may be
  filed beginning January 1, 2010
• Needs to be completed on an annual basis
• Colleges may set FAFSA filing deadlines that are
  different than the State Filing Deadline

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FAFSA On the Web (FOTW)

• Web site www.fafsa.gov
• 2010-11 FAFSA available on 1/1/2010
• FAFSA on the Web
• Worksheet to be used first
• Used as a pre-application worksheet
• Questions follow order of
• FAFSA on the WEB

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FAFSA on the Web

• Good reasons to file electronically
• - Built-in edits to help prevent costly errors
• Skip-logic allows student and/or parent to skip
  unnecessary questions
• More streamlined than ever before
• - More timely submission of original application
  and any necessary corrections
• - More detailed instructions and help for
  common questions
• - Ability to check application status on-line
• - Simplified renewal application process

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IRS Data Retrieval

• While completing FOTW, applicant may submit
  real-time request to IRS for tax data
• IRS will authenticate taxpayers identity
• If match found, IRS sends real-time results to
  applicant in new window
• Applicant chooses whether or not to transfer data
  to FOTW
• For 2009-10 will begin in January 2010
• For 2010-11 will be available July 2010

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Signatures

• Required
• Student
• One parent (dependent students)
• Format
• Electronic using PIN
• Signature page
• Paper FAFSA

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PIN Registration

• Web site www.pin.ed.gov
• Sign FAFSA electronically
• Can request PIN before January 1, 2010
• Not required, but speeds processing

• May be used by students and parents throughout
  aid process, including subsequent school years

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FAFSA Processing Results

• Central Processing System (CPS) notifies student
  of FAFSA processing results by
• Paper Student Aid Report (SAR) if paper FAFSA was
  filed students e-mail address was not provided
• E-mail notification containing direct link to
  students on-line SAR if students e-mail was
  provided on paper FAFSA or FAFSA on the Web (view
  SAR at www.fafsa.gov)
• Student with PIN can view SAR on-line at
  www.fafsa.gov
• Schools if listed on FAFSA will receive e copy
  within 3 to 5 days and paper copies within 10 to
  14 days

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Financial Aid Timeline

• October December
• Complete admissions application
• Complete any other documents from colleges
• Discuss any items with your admissions counselor
• Watch mail for 2010-2011 FAFSA in late December
• Visit the college(s) you have applied to
• Apply for PIN

• January May
• Complete FAFSA as soon as possible after January
  1, 2010
• Make sure you send the results to the colleges
  you are looking at using their school code
• Indiana State Grant deadline is March 10, 2010
• Watch mail for your financial aid award
  approximately 4-6 weeks after you submit your
  FAFSA

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Role of Financial Aid Office

• Determine aid eligibility using federal formula
• Colleges use EFC to award financial aid
• Packages aid depending on availability of funds
• Sends award notifications including
• Award amount for each program for which the
  student is eligible

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Financial Aid Award Example

• EXAMPLE ONLY
• Cost of Education - Family Contribution
  Need
• 26,000 8,000
  18,000
• College Scholarship 6,000
• SSACI Tuition Grant 2,900
• College Grant 3,300
• Stafford Subsidized Loan 3,500
• Stafford Unsubsidized Loan 2,000
• Work Study 2,000
• Total Aid 19,700

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Financial Aid Awards

• Look at the college selection process in terms of
  4-5 years
• Find out what happens to your award in the
  second, third and fourth year
• Find out cost increases for tuition, room and
  board for past few years
• Find out what happens if student receives funding
  from an outside source

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Tips for Applying for Financial Aid

• Apply as early as possible
• Meet college filing deadline/priority dates
• Meet state filing deadlines
• Find out what forms are required at each
  institution
• Used completed tax returns update as needed
• Read the instructions - dont assume
• Complete all questions
• Keep a copy of all records

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Frequent FAFSA Errors

• Parent and student social security numbers
• Missing signatures/PIN
• Divorce/remarried parent information
• Income earned by parents/stepparents
• Untaxed Income
• Household size number in college
• Real estate and investment net worth
• Not using real name as it appears on SS Card

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Special Circumstances

• Cannot report on FAFSA
• Contact the Financial Aid Office at each school
  to explain your specific situation
• College will review special circumstances
• May have a specific form
• May request additional documentation

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Special Circumstances

• Change in employment status
• Excessively high medical expenses not covered by
  insurance
• Change in parental marital status
• Expenses related to a students disability
• Death of a parent
• One time income exclusion
• Unusually high dependant child care costs
  associated with a disability

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Where Do I Go From Here?

• Obtain and review all admission and financial aid
  Web sites and materials for each school to which
  you are applying
• Meet all application deadlines
• Complete FAFSA and other application materials,
  such as College Scholarship Services
  (CSS)PROFILE application, if required by school
  or state agency
• Submit all requested follow-up documents
• Investigate all other sources of aid

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Avoid Being Scammed

• To check legitimacy of scholarship search
  services or individuals, for information about
  financial aid scams, and tips to avoid being
  scammed visit these Web sites
• U.S. Department of Education www.studentaid.ed.go
  v
• Better Business Bureau www.bbb.com

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Private Scholarship Search

• Free Internet scholarship search engines
• FinAid on the Web www.finaid.org
• College Board www.collegeboard.com
• FastWeb www.fastweb.monster.com
• Scholarship Resource Network Express
  www.srnexpress.com
• GoCollege The Collegiate Websource
  www.gocollege.com

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CAUTION!

• Avoid being charged a fee to file the Free
  Application for Federal Student Aid
• Completion and processing of the FAFSA are FREE
• If filing via FAFSA on the Web, be sure to go
  directly to www.fafsa.gov
• Contact financial aid office for help completing
  the FAFSA

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Closing

• Aid available from federal and state governments
• Get a PIN now! www.pin.ed.gov
• Student and parent must each have a PIN
• Complete forms by all deadlines
• Use www.fafsa.ed.gov to complete, sign and submit
  application.
• March 10, 2010

• Respond promptly to colleges if additional
  information requested
• Tax returns or other information
• College will notify via email, Web or mail of aid
  eligibility
• Student should follow colleges instructions to
  accept or decline aid offered.
• MARCH 10, 2010

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Questions?Thank You!

• Kim Bennett
• Chief Financial Aid Administrator and Executive
  Director of Admission
• Trine University
• bennettk_at_trine.edu