When you’re a high school senior, there’s no better feeling than opening up that envelope and pulling out your college acceptance letter. Your four years of hard work have paid off, and you’re going to be continuing your education! It’s a huge weight off your shoulders – but that excitement doesn’t last forever. Soon, the stress that used to be caused by wondering, “Will I get into college?” is replaced by, “How will I pay for college?”
Higher education is expensive – whether you’re going to a four- or two-year institution, the costs can add up until it seems almost impossible to comprehend. Luckily, there is financial aid available in the form of scholarships, grants and loans. The colleges to which you are accepted will offer you a financial aid package that usually includes some combination of these three resources, and the amount you receive of each is typically dictated by your Free Application for Federal Student Aid (FAFSA).
What is the FAFSA?
The FAFSA determines how much federal money you are eligible to receive based on your family’s financial circumstances. Schools can also use your FAFSA to determine how much institutional money you are eligible to receive from them, and what you and your family can reasonably be expected to contribute. The priority deadline to submit your FAFSA was February 15, though you can still submit it at this time. The earlier you get the form in, though, the more aid you are likely to receive; many forms of aid are distributed on a first-come, first-served basis.
To be eligible for federal aid, you must meet the basic eligibility criteria determined by the U.S. Department of Education. Among those requirements (all of which you can read here) is the demonstration of financial need. The FAFSA helps financial aid staff determine what your family is able to pay out of the total cost of your education. That number – your Expected Family Contribution – determines how much need-based aid you are eligible to receive as a student.
What types of aid can I receive by filling out the FAFSA?
The FAFSA will help you procure need-based financial aid, which comes in the form for grants, scholarships and loans. Not only does it determine what federal aid you’re qualified for, it also helps the state and your college or university determine what you’re eligible for at their level, as well.
Among the types of financial aid that the FAFSA will help determine if you qualify for is the Federal Pell Grant. A form of need-based aid, the Pell Grant does not have to be repaid following your education. However, not everyone who fills out the FAFSA is eligible for the Pell Grant. The Pell Grant is reserved for low-income students and families, and those who are eligible have a total family income of $50,000 a year or less; most Pell Grant money goes to students whose total family income is less than $20,000.
Your family’s income level and the type of school to which you are applying are also major factors in the financial aid process. For example, if you and your family are in the highest income bracket and are applying to a less expensive public institution, you will be expected to pay more out of pocket at that school, while a family from the lowest income quartile will demonstrate a great deal of financial need to that same school and, as such, be eligible for more need-based aid. However, more expensive schools shouldn’t always deter students based on price tag alone. While families with higher incomes may still be expected to pay more toward their students’ educations, and lower income families will still demonstrate high financial need but may have a financial gap to fill regardless, many private institutions have large endowments that help in filling those financial gaps. Schools with high price tags often have more internal financial aid options for their students beyond federal aid.
The FAFSA may also indicate that students are eligible for loans to help pay for their education, which are a tricky form of financial aid. Loans have to be repaid at the end of schooling, plus interest, which means many students end up paying thousands of dollars more back than they originally borrowed. You are responsible for paying your loans back even if you don’t graduate, or if you have trouble finding a job after graduation, which could put you in debt if you have trouble making your monthly payments. You can also go into default if you don’t pay your loans back, which can have major negative impacts on your financial life. Of course, if you’re prepared to accept the burden of paying back your loans after you graduate, they can be a helpful form of financial aid. Organizations like College Now can also help you consolidate loans after graduation in order to keep your payments manageable.
Can I get other types of financial aid outside of what the FAFSA says I’m eligible for?
Not all financial aid is determined by the FAFSA. The FAFSA gives you access to need-based financial aid, but other forms of financial aid can be procured beyond that. Other forms of financial aid are determined based on academic performance or other specific qualifications, and are primarily given in the form of scholarships. Scholarships don’t need to be repaid at the end of your schooling, but you can lose them if you do not maintain the eligibility requirements that you achieved when you first were awarded the scholarship. Other forms of non-need based aid can be found directly from your college or university, outside community organizations and even national programs.
If you need extra financial help in order to avoid having to take out loans, get in touch with College Now. You can apply for a College Now scholarship if you’re eligible, or check out our scholarship database to review the hundreds of other options out there to help you fill your financial gap.
What should I do once I’ve received my financial aid options?
When you’re evaluating your financial aid packages, it’s important to see what costs are included in your estimated cost of attendance at a postsecondary institution. On some award letters, the only cost that is noted is the cost of tuition – which may seem affordable when looking at your financial aid package, until you realize that you also have to factor in room and board and other living expenses. If your package doesn’t include these other costs, make sure you figure out exactly what those are so you have an accurate picture of the actual amount it will cost you to attend college.
Ensure that you’ve reviewed your financial aid package carefully. Are you being offered a financial aid package heavy on loans from one institution, and one heavy on grants from another? Did you qualify for the Pell Grant – and how much will that grant get you at each institution to which you are applying? Is one school offering you a high number of institutional scholarships that will fill your financial gap?
Don’t forget to review the stipulations on each school’s financial aid package – what happens if you have to take a leave of absence or drop a class? What sort of academic progress does your financial aid hinge upon?
If you need help reviewing you financial aid package, make an appointment with your College Now advisor or in our Resource Center to review your options with a financial aid professional who can help ensure you are making the most informed decision in your financial postsecondary future.
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