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The Breakdown of Financial Aid

The Breakdown of Financial Aid

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The Breakdown of Financial Aid

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  1. The Breakdown of Financial Aid

  2. WARNING….

  3. Discussion Topics • What is financial aid? • Cost of Attendance • Expected Family Contribution • Financial Need • Types of Aid • Filling out the FAFSA (FREE Application for Federal Student Aid) • Special Circumstances • Mike’s Tips

  4. What is Financial Aid? • Assistance to help make college more affordable for you and your family • Money designed for educational expenses

  5. What Financial Aid is not

  6. How Refund Checks Work $25,000 Cost of Attendance – 20,000 Tuition/Room and Board = *$5,000 Refund Check • *Based off of a full financial aid package

  7. Cost of Attendance(COA) • Direct costs are the costs billed directly to your student account • Tuition & Fees • Room & Board • Billed twice a year

  8. Cost of Attendance(COA) • Indirect Costs: • Books/Supplies • Personal/Miscellaneous • Transportation

  9. Sample Cost of Attendance(COA) In – State Out–of-State Tuition & Fees $10,280 $29,540 Room & Board $7,986 $7,986 Books & Supplies $1,362 $1,362 Pers/Misc $2,340$2,340 • Total $21,968* $41,228* • *This is the maximum amount of financial aid you can receive

  10. Costs of Attendance 2012-2013 • Wayne County Community College $9,314 • Saginaw Valley State University $18,072 • Wayne State University $22,390 • Michigan State University $24,670 • University of Michigan-Ann Arbor $25,848 • University of Wisconsin $41,054 • University of Chicago $61,390 • Harvard University $62,950

  11. Cost of Attendance Trivia • TRUE or FALSE • Cost of Attendance at a university will be the same for each incoming freshman. • FALSE

  12. Questions????

  13. Expected Family Contribution (EFC) • The amount a family is expected to contribute to their child’s education. • Federal formula determined by information provided on FAFSA • Parent contribution + Student contribution • EFC will be the same for each school • Can range anywhere from 0-99,999

  14. Financial Need $22,150 Cost of Attendance – 4,150 EFC = $18,000 Financial Need • This is what your financial aid award is based on.

  15. Types of Aid • Scholarships • Grants • Work Study • Loans

  16. Types of Aid: Grants • Free money • Awarded on the basis of financial need • Must complete FAFSA to be considered for federal funds. Pell Grant, etc. • May have to complete additional documentation for institutional funds

  17. Types of Aid: Scholarships • Free money • Awarded on basis of skill, merit, unique talent, or financial need • Have to complete FAFSA to be considered for most scholarships • The sooner you apply, the more money is available to offer • Apply! Apply! Apply!

  18. Types of Aid: Scholarships • Use resources available online • Google • www.fastweb.com • www.scholarships.com • www.zinch.com • www.collegetoolkit.com • www.collegeboard.org

  19. Scholarship Scams • Be wary of scholarship scams! • Key signs of a scam are: • Scholarships that request an application fee • Guarantees that you’ll win a scholarship • Everyone is eligible, there should be some criteria • Excessive hype or pressure to apply • No telephone number • Asking for checking/savings account or Soc Sec No. Website: www.finaid.org/finaid/scams.html

  20. Scholarship Tips • Set personal goals for each week, month, etc. • Small scholarships add up! • Use some of the same admissions essays for scholarship essays • Research available opportunities in your community • Companies may have scholarships available to children of employees • Apply at each school you’re interested in

  21. Understanding your Scholarships • Is there a minimum GPA I must maintain? • Are there a certain amount of credits I need to take each semester? • Is this scholarship renewable each year? • What exactly does this scholarship cover? • After this scholarship is applied, what are the remaining costs that I’m responsible for?

  22. Scholarship Trivia • TRUE or FALSE • I should start applying for scholarships before I am even accepted into a college • TRUE

  23. Types of Aid: Loans • Borrowed money • Federal loans have fixed interest rates • Loans are in student’s name and do not affect the parent • Invest for the future, borrow wisely, only what is needed • Have to complete FAFSA to be offered most loans

  24. Types of Financial Aid: Loans

  25. Repayment Options • Income Based Repayment • Income Contingent • Graduated Repayment Plan • Deferment • Forbearance

  26. Student Loan Trivia • TRUE or FALSE • If I drop below half time enrollment at my institution, student loans will go into repayment. • TRUE

  27. Types of Aid: Work Study • Money that has to be earned • Students have to search and apply for job • Will earn paycheck to use for educational expenses • Government pays a portion of wages • Hours capped at 20 per week

  28. Sources of Financial Aid • FEDERAL GOVERNMENT • Largest Source • Primarily awarded on • need • STATE GOVERNMENT • Residency Requirements • State Deadlines • Need and Merit Based • INSTITUTIONAL • PRIVATE • Businesses and Foundations

  29. Common Federal Aid Programs • Federal Pell Grant • Federal Supplemental Educational Opportunity Grant(FSEOG) • Federal Perkins Loan • Federal Work Study • Subsidized and Unsubsidized Loans • Parent PLUS Loan

  30. Questions??

  31. Filling out the FAFSA: Why? • The only way to determine EFC which in turn determines your financial aid eligibility • This single application can be sent to 10 different schools • Can be used for multiple sources of aid

  32. Filling out the FAFSA: Who? • Each student needs to fill out a separate FAFSA • Parental data can be transferred for multiple children • Parent(s) • Both parents (biological, step or adoptive parent) if married • Only one parent if single, divorced, or separated(the one the student lives with) • Expect to use same parent each year

  33. Filling out the FAFSA: Dependent vs. Independent • Majority of incoming students are dependent • If dependent, parental info must be provided • Student may be independent if: • Married • 24 years of age or older • Have a dependent they provide more than 50% support for • Foster care • Legal guardianship

  34. Filling out the FAFSA: Who is Eligible? • U.S. Citizens • Eligible noncitizen • Permanent U.S resident with Permanent Resident Card • Conditional permanent resident with Conditional Green Card • Parents do not need a social security number but student must have one

  35. Filling out the FAFSA: When? • 2013-2014 Application will be available Jan. 1st, 2013 • State deadline for scholarships is March 1st • Check with your school for their deadline, if deadline not met you will be 2nd priority or later • Must be completed every year

  36. Completing the FAFSA: How? • www.fafsa.gov • www.fafsa.com

  37. Filling out the FAFSA: How? • 2012 Tax Return/2011 for estimation • Bank Statements/Asset Statements • Investments, Rental Property • Disability, Child Support • Department of Education PIN • Student AND one parent • www.pin.ed.gov

  38. Potential Errors • Wrong Social Security Number • Number of household members in college • Divorced/remarried parental information • Rental property and investment net worth • Untaxed income • Income earned by parents/stepparents • Income taxes paid • Household size

  39. IRS Data Retrieval • The IRS Data Retrieval Tool will allow FAFSA on the Web applicants to request and retrieve their income and tax data from the IRS • Available February 2013 for the 2013-2014 cycle • Electronic tax returns are typically available in 1-2 weeks, paper tax returns typically take 6-8 weeks

  40. Verification • Earliest you’ll hear from a school is March • Additional documentation will most likely be requested so expect to hear back from the school you’re admitted to within a month • 1040 forms, pay stubs, household/asset questionnaire • Must respond to each school individually • If you never provide tax returns, it’s as if you never filled out the FAFSA!

  41. Special Circumstances • Change in Employment, death, marital status, one-time significant benefit, large out-of-pocket medical expenses, etc. • Cannot report on FAFSA • Send explanation to financial aid office at each college • All special circumstances will be reviewed and a FINAL decision will be made • Cannot appeal this decision to Dept of ED

  42. Mike’s Tips • Payment Plan- bill is due soon as student starts class • Private scholarships are important. • Any entity that you frequent, see if they offer scholarships • Set concrete schedule for filling out scholarships • Satisfactory Academic Progress • Only borrow what’s needed • Spend refund check wisely

  43. College Goal Sunday!!!! • Free help to fill out FAFSA • February 10th 2-4pm • Locations available all around MI • www.micollegegoal.org

  44. Maize and Blue Days • Starting in Mid January • Tues and Thurs from 1-7pm • University of Michigan Detroit Office • 3663 Woodward Ave Suite 190 • (313)872-7068

  45. Thank you!!

  46. For More Information • Michael Davis • michdav@umich.edu • 734-763-4124 • University of Michigan Office of Financial Aid • www.finaid.umich.edu • Federal Student Aid • www.studentaid.ed.gov or www.students.gov • Michigan Office of Scholarships and Grants • 1-888-4-Grants or www.michigan.gov/studentaid