2012 Annual Statewide Financial Aid Conference for High School Counselors

1. 2012Annual Statewide Financial Aid Conference for High School Counselors • November 7, 2012

2. Conference Agenda • Presentation on 2013-2014 System • Break • Financial aid administrator panel Q & A session • Demonstration of financial aid web sites

3. Application Process & FAFSA

4. Free Application for Federal Student Aid - FAFSA • Apply on-line at: www.fafsa.gov • Watch out for www.fafsa.com • Commercial site with fee for service • If family prefers paper FAFSA form • Can download from: www.fafsa.gov • Select “FAFSA Filing Options” • High schools can download and make copies • Can order by phone: 1-800-4FEDAID

5. Applying for 2013-2014 • Submit FAFSA after January 1, 2013 • The earlier, the better • Can complete with estimated tax figures and make corrections later • College financial aid deadlines vary, some early • Posted on school web site or OHE Counselor’s Guide • Carleton, Macalester, St. Olaf, Gustavus Adolphus (and many east coast colleges) require CSS Profile form in addition to FAFSA • https://profileonline.collegeboard.com

6. 2013-2014 Paper FAFSA • Paper FAFSA green (student) and purple (parent) • No additional or deleted questions • Minor changes to instructions • Draft in packet • 2013-2014 FAFSA on the Web Worksheet • Must order from: www.fsapubs.org • 1 (800) 394-7084 #5

7. FAFSA on the Web (FOTW) www.fafsa.gov • Apply • Retrieve IRS data • Reapply • Apply for PIN • Find college codes • Check status of FAFSA • Make corrections • Add additional colleges • Print SARs

8. 2013-2014 FOTW Changes • Case sensitivity removed for PIN retrieval challenge question • Will help those with existing PIN retrieve it from PIN system if lost/forgotten • FOTW home page START HERE button changed to: OR • Make corrections • Add a college • View your Student Aid Report • Start a New FAFSA • Log In

9. 2013-2014 FOTW Changes • FOTW confirmation page will reference program eligibility requirements • Hyperlink to “Am I eligible for student aid?” • New language will inform students that they must be high school graduates or have earned a GED • Previously, students without these credentials could qualify if they passed Ability-to-Benefit test or successfully complete 6 college credits

10. 2013-2014 FOTW Changes • To address FOTWs rejected for lack of signature: • “Sign with my PIN” will be the default signature option for most applicants • Users can choose another option for signing, and when selected, the system will display options to print a signature page or submit without signatures, along with text explaining the benefits of electronic signatures

11. 2013-2014 FOTW Changes • PIN mailers will no longer be mailed to students • All other PIN options will remain • Email • View on-line • Current and new browser versions will be supported • Unsupported browser message will no longer appear • Incompatible browsers will continue to be blocked

12. FOTW Supported Browsers • Internet Explorer: 7.0 – 9.0 • Mozilla Firefox: 3.5 – 9.0 • Apple Safari: 4.x – 5.x • Google Chrome browsers: • Google Chrome 9.0.x – 18.0.x • Opera: 9.5.x – 11.x, Mini

13. 2013-2014 FOTW Changes • Facebook and Twitter options will be presented at end of FOTW to allow users to share that they have completed the FAFSA

14. Parents' Password Cracked On First Try REDONDO BEACH, CA— Nick Berrigan, 14, successfully hacked into his parents' AOL account on the first try Tuesday, correctly guessing that "Digby" was their password. "They actually used the dog's name," said Berrigan, deactivating the parental controls on his AOL account. "They don't give me much credit, do they?“ Experts advise parents to secure Internet accounts with any password besides the name of a family pet.

15. FAFSA on the Web 2013-2014 IRS Data Retrieval • Approximately 84% of families are eligible to use the IRS data retrieval process to populate the FOTW • Who CAN’T use IRS data retrieval: • Married couples who filed separate tax returns • Tax filing status is head of household • Filed an amended return • Filed Puerto Rican or foreign tax return • Filed tax return too recently • Applicants whose marital status changed since January 1 of the processing year • Amended return tax filers must submit original 1040 and 1040x

16. FAFSA on the Web 2013-2014 IRS Data Retrieval • If family can’t use IRS Data Retrieval, will need to produce official IRS tax return transcript if selected for verification • On-line request at: http://www.irs.gov/Individuals/Order-a-Transcript • Must type in SSN, name and address exactly as it appears on tax return • Can look up zip code at: www.usps.com to get exact street address • Touch-tone phone request at: • 1 (800) 908-9946

17. FAFSA on the Web 2013-2014 IRS Data Retrieval • If applicant indicates filed taxes on FOTW, will be prompted to use IRS data interface • If chooses not to use IRS interface will be subject to selection for verification • IRS data available: • 2 weeks after federal tax forms filed electronically (70% of filers) • 8-10 weeks after paper federal tax forms filed (some have experienced longer delays) • Not available until any tax owed the IRS is paid

18. Items Populated on FOTW from IRS Data Retrieval • Adjusted gross income • However, wages from employment are not transferred • Families should make sure mother’s and father’s wages (from W-2) are entered correctly on FOTW • U.S. income taxes paid • Untaxed IRA distributions • Untaxed pensions • Education credits • IRA deductions • Tax exempt interest

19. FAFSA on the Web 2013-2014 IRS Data Retrieval • IRS data retrieval can be used: • While completing original FOTW • As a later correction to FOTW • Applicants will receive automatic reminder emails to go back to FOTW and use IRS data retrieval if: • They provided estimated tax figures on the FOTW • Provided actual tax figures on FOTW but did not use IRS data retrieval

20. Providing Parents’ Information on FAFSA • Parents’ information • Grandparents, foster parents, other relatives and legal guardians are NOT considered parents on the FAFSA unless they legally adopted student • Do NOT substitute information about above parties in parent section on FAFSA • In many cases, these applicants will be able to apply as independent via: • Meeting one of the independent criteria in Step Three; or • Dependency override

21. Providing Parents’ Information on FAFSA • If biological/adoptive parents married, report information for both parents • If biological/adoptive parents are divorced or separated, provide information for parent: • Student lived with the most in last year • Or, if lived equal periods with each parent, parent who provided the most financial support in last year or most recent year support provided • If that parent remarried, include stepparent’s information, even if stepparent did not adopt student • Note: Unlike FAFSA, CSS Profile form will require information for non-custodial parent

22. FAFSA Handouts for Students • Tips for Completing the 2013-2014 FAFSA • Completing the FAFSA: Special Guidance Related to Dependency Status and Providing Parental Information #6 #7

23. FAFSA Training • Detailed FAFSA line-by-line training provided at Minnesota College Goal events • www.minnesotacollegegoal.org • New high school counselors encouraged to attend or volunteer to be host site

24. Post-ApplicationProcess

25. FAFSA Results • Student notified of FAFSA processing results by: • E-mail notification with link to student’s SAR online if student’s e-mail address provided: • FAFSA on the Web (takes 1-2 days if electronically signed with PIN; 2 weeks if mailed in signature page) • Make sure student adds federal email address to address book to avoid delivery problems FederalStudentAidFAFSA@cpsemail.ed.gov • If student has a PIN, can view SAR online at www.fafsa.gov • Draft 2013-2014 SAR #8

26. Corrections • Go to: www.fafsa.govand click on Log In to make any necessary corrections • Add a college • Correct FAFSA data items • Use IRS data retrieval

27. If Selected for Verification • For 2013-2014, menu of items subject to verification are: • Number of household members • Number of household members in college • Food Stamps/SNAP (if indicated receipt on FAFSA) • Child Support Paid (if indicated on FAFSA) • Income earned from work (if non-tax filer) • IRS data retrieval items from federal tax return

28. New Verification Items 2013-2014 • Two new items for 2013-2014, but not for all students • High school completion status • Student must submit copy of high school diploma or transcript showing graduation date • Identity/Statement of Educational Purpose • Applicant must appear in person and show government-issued photo ID • Driver’s license, non-driver’s license, military identification or passport • Also sign statement of educational purpose • If can’t appear in person, submit copy of photo ID and notarized statement of educational purpose

29. If Selected for Verification • Verification items tailored to each student and indicated on SAR/ISIR • Some students may need to verify all items; others not • If items limited to data from tax return, verification can be accomplished through IRS data retrieval process alone • If unable to use IRS data retrieval, school will require an official IRS tax transcript (or signed copy of 1040 and 1040x for amended returns) • If verification items include both tax return and other items, then verification worksheet or other documentation must also be completed

30. Professional Judgment • Normally, a family’s Expected Family Contribution (EFC) is based on income for the previous tax year • For 2013-2014 academic year, tax year 2012 • Financial aid administrators can use their “professional judgment” to alter data on the FAFSA for special circumstances • Adjustments are typically performed as corrections after the original FAFSA is submitted and verified

31. Professional Judgment • Common examples include: • Significant change in income from past tax year based on unemployment, underemployment, loss of benefits, loss of child support, death, divorce, military service or natural disaster • Unusually high medical expenses • Nursing home expenses • Elementary or secondary school tuition • Significant college costs for dependent student’s parent attending college • Dependency override • Family should contact financial aid administrator to discuss unusual circumstances

32. What is a Dependency Override? • Gives financial aid administrator authority to allow otherwise dependent applicant to apply as independent applicant due to unusual circumstances • Parental abuse, abandonment, incarceration, etc. • Not used simply because student lives outside parent household after age 18 or parents object to providing data • Must be supported by documentation, preferably by someone outside immediate family • Student should contact financial aid office for instructions after submitting FOTW without parental data

33. Completing FAFSA Without Parental Information • For students who don’t qualify for a dependency override but can’t provide parental information: • Will have the option to submit the FAFSA for an unsubsidized loan only • FAFSA on the Web will present a path that allows the applicant to indicate that he or she will not provide parental data on the form and will allow the applicant to submit the FAFSA • School will later require statement from one parent that parents refuse to complete the FAFSA and do/will not provide financial support to the student

34. Award Notification • Student should receive award notice from each college listed on the FAFSA once admitted to college • Important that student identifiers on FAFSA match identifiers used in admissions process • All other required paperwork must be completed • Financial aid varies depending on the cost and mix/composition of financial aid available • Compare: • Net costs after grants and scholarships

35. Federal Methodology EFC Calculation Another parent called to complain that his son had not received any need-based aid. When Ms. Silberman explained why, the parent said he would hop on his private plane and fly to the campus to straighten her out. But he flew out the same way he flew in -- empty-handed From www.finaid.org

36. Financial Aid Shopping Sheet • Developed by Consumer Financial Protection Bureau • Emphasis on: • Net costs for purposes of comparing award offers • Keep in mind that net costs on shopping sheet are total costs minus gift aid, not just directcosts • Informing students about loan debt and payments • Required for schools administering federal veterans benefits • Many colleges will start using for 2013-2014 • Most will use as cover sheet in addition to their more detailed financial aid award notice • May be used in electronic format

37. #19

38. Sources of Financial Aid

39. Federal Methodology EFC Calculation #9

40. 2012-2013 Average Tuition and Fees • Technical & Community Colleges $5,358 • State Universities $7,658 • University of Minnesota $13,526 • Private Career Colleges $13,689 • Private Colleges & Universities $33,373

41. Cost of Attendance • Tuition and fees • Room and board • Books, supplies and equipment • Transportation • Personal expenses • Typically, COA = • T&F $10,000 - $15,000

42. The College Pay-Off

43. Packaging Financial Aid • In general, need-based financial aid cannot exceed cost of attendance minus EFC • Some forms of financial aid can replace all or portion of EFC (Unsubsidized Stafford Loan, PLUS Loan, certain private scholarships, etc.) • Most programs require school to limit financial aid & EFC to cost of attendance • If financial aid awarded by college exceeds COA, most schools reduce loans, work study or institutional aid* • $ 25,800 Cost • - 4,200 EFC • 1,400 Pell Grant • 2,100 State Grant • - 10,000 College Sch* • - 10,000 Private Sch • 5,500 Sub Stafford* • = ($7,400)

44. Net Price Calculators • Every college has net price calculator on its website • Required by Higher Education Opportunity Act • Using certain inputs entered by student, will calculate net price of college after gift aid is subtracted from gross price • Accuracy/complexity of estimates will vary across colleges • Some colleges significantly enhance USDE net price calculate template

45. Federal General Student Eligibility Criteria • Enrolled or accepted for enrollment in eligible program of study • Pursuing recognized credential • U.S. citizen or “eligible non-citizen” • Permanent residents with I-551 or I-551C card • Refugees, asylees, victims of human trafficking, T-Visa holders with I-94 card • High school diploma or GED • Registered with Selective Service (if male 18 – 25 and required) • Not convicted for sale of illegal drugs while receiving federal aid • Last three bullets don’t affect state financial aid

46. Federal Grants & Scholarships2013-2014

47. Federal Changes • Students may only receive Federal Pell Grants for the equivalent of 6 full-time academic years • 12 FT Semesters or 18 FT quarters • Less than full-time awards only count as fraction of full-time award • e.g. 24 HT semesters = 12 FT semesters • Students notified of nearing/reaching limit on Student Aid Report • Many students affected

48. State Grants & Scholarships*2013-2014 #10 #14 *For MN residents attending MN colleges. State Grant maximum award not yet known for 2013-2014.

49. State Grant Changes • New MN state interface with FAFSA on the Web!! • MN residents submitting 2013-2014 FOTW will be directed to OHE secure web site for state eligibility questionnaire • “Click Here if you want to apply for MN state financial aid” will appear on FOTW confirmation page • Will transfer student’s FAFSA data to OHE’s web site for use in eligibility questionnaire skip logic • Transferring FOTW data to state site is voluntary • Will be URL students can use at later date if they neglect to click on state link in FOTW

50. State Grant Changes • On-line state eligibility questionnaire replaces paper questionnaire previously sent to student by campus financial aid office • Purpose is to streamline eligibility screening • Students will advance through a series of questions about state residency and the amount of previous postsecondary attendance • Will be instructed NOT to list college courses taken during high school • These courses do NOT count against the State Grant 4-year limit on postsecondary attendance