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What You Need to Know About Financial Aid. Discussion Topics. What is financial aid Cost of attendance (COA) Expected Family Contribution (EFC) What is financial need Categories, types, and sources of financial aid Free Application for Federal Student Aid (FAFSA) Special circumstances.
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Discussion Topics • What is financial aid • Cost of attendance (COA) • Expected Family Contribution (EFC) • What is financial need • Categories, types, and sources of financial aid • Free Application for Federal Student Aid (FAFSA) • Special circumstances
What is Financial Aid? Financial aid is made up of federal, state, institutional and private funding. These funds are used to help provide students and families a way to pay for college educational expenses
What is the Cost of Attendance (COA) • Direct costs – Tuition, fees and books • Indirect costs – Room, board, transportation and personal expenses • Direct and Indirect costs combined into cost of attendance (COA) • Varies widely from college to college
What is the Expected Family Contribution (EFC) • The amount a student/parent(s) is expected to pay toward the student’s COA (the EFC is calculated by using federal methodology from the Department of Education). • Stays the same regardless of college • Two components • Parent contribution • Student contribution
What is Financial Need? Cost of Attendance (COA) –Expected Family Contribution (EFC) = Financial Need
Categories of Financial Aid • Need-based • Non need-based
Types of Financial Aid • Scholarships • Grants • Loans • Employment
Scholarships • Money that does not have to be paid back • Awarded on the basis of merit, skill, or a unique characteristic
Grants • Money thatdoes not have to be paid back • Usually awarded on the basis of financial need
Loans • Money thatdoes have to be paid back • Money student and/or parent borrows to help pay college expenses • Repayment usually begins after education is finished • Only borrow what is really needed • Look at loans as an investment in the future
Employment • Money that students earn that can be used to help pay college educational costs. • A paycheck • Non-monetary compensation, such as room and board
Sources of Financial Aid • Federal government • State government • Private sources • Civic organizations and churches • Employers
Federal Government • Largest source of financial aid • Aid awarded primarily on the basis of financial need • Must apply every year using the Free Application for Federal Student Aid (FAFSA)
State Government • Residency requirements • Award aid on the basis of both merit and need • Uses information from the FAFSA application • Deadlines vary by state; Check Application Deadline Dates on the FAFSA’s Web site
Federal Pell Grant Academic Competitiveness Grant (ACG Grant) National Science and Mathematics Access to Retain Talent Grant (SMART Grant) Teacher Education Assistance for College and Higher Education Grant (TEACH Grant) Federal Supplemental Educational Opportunity Grant (SEOG) Federal Work-Study Federal Perkins Loan Federal Direct/Stafford Student Loans Federal Direct/Stafford Parent Loan for Undergraduate Students (PLUS) Loan Federal Aid Programs
Minnesota Achieve Scholarship Program – check with HS counselor Minnesota State Grant Minnesota Post-Secondary Child Care Grant Minnesota Public Safety Officer’s Survivor Grant Student Educational Loan Fund (SELF) Loan Minnesota State Government Aid Programs
Institutional/Outside Financial Aid • Institutional Grant • Tuition Waiver • Special Programs • Scholar Awards • Other – Veterans, research and internships, non-resident tuition, etc. • Loans
Private Sources • Foundations, businesses, charitable organizations • Deadlines and application procedures vary widely • Begin researching private aid sources early Check with HS counselor and colleges
Civic Organizations and Churches • Research what is available in community • To what organizations, clubs and churches does student and family belong? • Application process usually spring of senior year • Small scholarships add up! Check with HS counselor and colleges
Employers • Companies may have scholarships available to the children of employees • Companies may have educational benefits for their employees
Free Application for Federal Student Aid (FAFSA) • A standard form that collects demographic and financial information about the student and family • May be filed electronically or using paper form – *New* - by phone for 2009-2010 • Available in English and Spanish
FAFSA • Information used to calculate the Expected Family Contribution (EFC) • Colleges use EFC to award financial aid
FAFSA Web site: www.fafsa.ed.gov • May be filed at any time during an academic year, but no earlier than the January 1st • Colleges may set FAFSA filing deadlines • Check with the specific colleges for additional deadlines or financial aid forms that must be completed
FAFSA on the Web Good reasons to file electronically: • Built-in edits to prevent costly errors • Skip-logic allows student/parent to skip unnecessary questions • 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 application process in the future
Student Financial Aid Personal Identification Number (SFA PIN) • Web site: www.pin.ed.gov • Sign FAFSA electronically • Can request PIN before January 1, 2009 • Not required, but speeds processing • May be used by students and parents throughout aid process, including subsequent school years
FAFSA on the Web Worksheet 2009-2010 FAFSA on the Web Worksheet—8-page booklet containing: • Instructions • 93 questions in 5 sections
Section 1 – Student Information (page 2) • Name • Social Security Number • Driver’s license number
Section 1 (continued) – Student Information (page 2) • Citizenship • Alien Registration Number – if applicable • Marital status • State and date of legal residence • Selective Service registrationstatus
Section 1 (continued) – Student Information (pages 2 and 3) • Received federal student aid • Drug conviction status • Parents’ educational background • 2009-2010 Degree • 2009-2010 Enrollment status • Work-study and loans
Section 2 – Student Dependency Status (page 3) • If the student answers YES to any questions in Section 2, skip to section 4 on page 6 (Independent Student). • If the student answers NO to ALL the questions in Section 2, complete Section 3 on page 4 (Dependent Student).
Section 3 – Parental Information (page 4) • Parents’ marital status • Date of parents’ marital status • E-mail address (optional)
Section 3 (continued) – Parental Information (page 4) • Social Security Number • Last name • Date of birth • State and date of legal residence
Section 3 (continued) – Parental Information (page 4) • Tax filing status and return type • If parents filed or will file a 1040, were they eligible to file a 1040A or 1040EZ? • Did anyone in the parents’ household receive benefits from any of the federal programs listed?
Section 3 (continued) – Parental Information (page 5) • Dislocated worker status • 2008 Adjusted Gross Income (AGI) • 2008 Income earned from work • 2008 Income tax paid
Section 3 (continued) – Parental Information (page 5) • 2008 Exemptions claimed • Household size • Number in college
Section 3 (continued) – Parental Information (page 5) • Complete the tables on page 8 (left-hand side) • 2008 Additional Financial Information • 2008 Untaxed Income
Parent Asset Information (page 5) • Cash, savings, and checking • Net worth of investments • Net worth of business and investment farms
Section 4 – Student Finances (page 6) • Tax filing status and return type • If student/spouse filed or will file a 1040, was he/she eligible to file a 1040A or 1040EZ? • 2008 Adjusted gross income (AGI) • 2008 Income earned from work • Type of veterans benefits the student will receive
Section 4 (continued) – Student Finances (page 6) If the student answers YES to any questions in Section 2 – Student Dependency Status (Independent Students), answer the following questions: • Household size • Number in college • Receipt of benefits from one of the federal programs listed • Dislocated worker status
Section 4 (continued) – Student Finances (page 7) • 2008 Income tax paid • 2008 Exemptions claimed
Section 4 (continued) – Student Finances (page 7) • Complete the worksheets on page 8 (right-hand side) • 2008 Additional Financial Information • 2008 Untaxed Income
Student Asset Information (page 7) • Cash, savings, and checking • Net worth of investments • Net worth of business and investment farms
Section 5 – Colleges to Receive Information (page 7) List up to 10 colleges to receive FAFSA information: • Federal School Code for each college • Housing plans for each college
Now What? • Take the FAFSA on the Web worksheet to the FAFSA Web site. • To sign the FAFSA electronically have the student/parent (one parent for dependent students) PIN numbers ready • Complete and submit the 2009-2010 FAFSA application
FAFSA Processing Results • Central Processing System (CPS) notifies student of FAFSA processing results by: • E-mail notification containing a direct link to student’s on-line Student Aid Report (SAR) if student’s e-mail was provided – parent will also receive notification if e-mail was provided.
Student Aid Report (SAR) • Student with PIN may view SAR on-line at www.fafsa.ed.gov • Review data for accuracy • Update estimated tax information when actual figures are available
FAFSA Processing Results • FAFSA information is sent to the colleges listed on FAFSA approximately 10 to 14 days after FAFSA submitted • College reviews the FAFSA information • May request additional documentation, such as copies of federal tax returns