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Financial Aid 2009 - 10

Financial Aid 2009 - 10. Tom DaRin Vice President for Enrollment Management Nazareth College. Two Forms of Financial Aid. Need Based Aid : Demonstrated need must be established first. Sources – federal, state, and college.

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Financial Aid 2009 - 10

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  1. Financial Aid 2009 - 10 Tom DaRin Vice President for Enrollment Management Nazareth College

  2. Two Forms of Financial Aid • Need Based Aid: Demonstrated need must be established first. Sources – federal, state, and college. • No Need/Merit Based Aid: Merit means different things at different places (academics, athletics, visual and performing arts, geography are some examples). Sources – federal (1), state, and college.

  3. Formula To Determine Demonstrated Need Cost of Attendance (tuition, fees, room/board, books, travel, personal) minus Expected Family Contribution (EFC) equals Demonstrated Need

  4. Factors to determine the ExpectedFamily Contribution (EFC) • Determine student status: dependent or independent • Parent(s) income in the prior tax year (2008). Divorce: use custodial parent 1040 • Number of family members pursuing a college degree (exclude parents) • Family size • Student assets (20% of the total) • Student income above $3,400 (50% above $3,400) • Parents assets (5.6% of the total).

  5. Assets • Include: savings and checking accounts, bonds (including savings bonds), 529 Savings Plans, Uniform Gift to Minors, trusts, investments such as second/vacation home, land, business value • Do not include (for federal methodology): home equity (primary residence), 401K, IRA’s, employer sponsored pension programs

  6. Financial Aid Forms FAFSA(Free Application for Federal Student Aid) • Required at every college that awards Federal Title IV student aid. • File after January 1, but before published college deadlines. • Must be filed each year the student is in college. • Up to 10 colleges may be listed at one time • It takes 2-5 days (electronically) before colleges receive data from the federal processor • you will receive a SAR (Student Aid Report) from the processor. Check it carefully for errors or omissions. The SAR is generated within minutes after submitting the FAFSA and sent to you via email.

  7. Financial Aid Forms FAFSA(Free Application for Federal Student Aid)continued • FAFSA must be filed electronically at www.fafsa.ed.gov. No fee is charged. • Electronic filers must submit a PIN, in lieu of a signature, for both the parent and student (www.pin.ed.gov). Parent and student may apply for the PIN at any time. Save your PIN. • Note: If you are eligible to file a 1040 A or 1040 EZ tax form, your EFC is calculated using a simpler federal methodology. For example, if you file the 1040 A or EZ form, and your AGI is <$30,000, your EFC = 0. That would qualify you for a maximum Pell Grant.

  8. Supplemental Financial Aid Forms College Scholarship Service (CSS) Profile • Used by certain colleges to collect information early and/or information not provided on FAFSA • Profile information is generally used to award institutional (college) aid • Profile is not a substitute for FAFSA • A fee is required for processing ($25 initial registration including first college/$16 each additional college) • Contact CSS directly to process a Profile form. Only accepted online at collegeboard.com • Only send Profile to those colleges that require it • Estimate carefully if you complete it before tax information is available

  9. Supplemental Financial Aid Forms TAP (New York Tuition Assistance Program) • Grant assistance available to New York residents, who graduated from a NY high school, and attend a college in NY (2 year or 4 year, public or private). • FAFSA filers, who are NYS residents, automatically receive a pre-populated TAP application directly from HESC (Higher Education Services Corporation) in Albany • Complete the application and return to HESC onceyou have determined which NY college you will attend. (Probably after May 1) • Based on NYS taxable income (not Federal AGI) of $80,000 or less.

  10. Supplemental Financial Aid Forms TAP (New York Tuition Assistance Program)continued • Minimum Award $500 (NYS taxable income between $46 – 80K) • Maximum Award $5000 (private college) / 90% SUNY tuition (state supported colleges) • Renewable for 8 full time semesters. Funding contingent upon state budget approval. (10 semesters for those enrolled in NYS HEOP or EOP programs).

  11. Supplemental Financial Aid Forms Institutional (forms used by individual colleges/universities) • Used to collect information not found on the FAFSA • Information received is used to award institutional (college) aid • The institutional form is not used to determine federal and state eligibility • Submit the form by the required due date • No fee to file • The form, if used, is usually found in the same packet as the admissions application.

  12. When will I hear from colleges? • No financial aid may be awarded until a student has been accepted for admission. • Four to six weeks after you submit the required forms most colleges are ready to send a financial aid package to the student. Remember, it’s contingent upon which forms need to be submitted, when they are submitted, and the quality of the information.

  13. What can delay the process? • Inconsistent or inaccurate information (ex. incorrect Social Security number). Colleges will ask for tax forms to verify what you have reported. • Not answering all questions that pertain to you and your situation. • Not filing the required forms and/or not filing them on time. • Not properly signing the FAFSA via your PIN.

  14. Important Tips to Remember • Students with a May 1 reply date for accepting an offer of admission must have all forms submitted no later than March 1(Jan./1 – Feb/15 preferred) • Financial Aid offers may go out on a rolling basis (first in, first out) depending upon admission notification dates. Others may place the financial aid award in with the acceptance letter (if admission notification is later than 3/15) • File all the required forms by the earliest deadline published. Do not wait to hear from Admissions before filing for financial aid. If need be, estimate taxes and submit forms. Verification comes later.

  15. Sources of Financial AidFederal (need and merit based) • Pell Grant: $4731 maximum award per year (’08-09/’9-’10 TBA). Based on high demonstrated need. Minimum award $890. • ACG (Academic Competitive Grant) and SMART Grant: ACG are for Pelleligible first and second year students who come out of a competitive secondary school program of study. $750 for year 1; $1300 for year 2. SMART Grants are for Pell eligible third and fourth year students with a minimum 3.0 gpa in federally recognized programs in science, math, IT, engineering, and specialized languages. $4000 per year. ACG and SMART grants are awarded above the student’s Pell eligible amount. • TEACH Grants: $4000 per year (x4 years UG/x2 Graduate). Must teach in a federally designated high need school district in a high need area (math, science, special ed, foreign languages) for a minimum of 4 years. New in 2008-09. Separate application must be filed at teachgrant.ed.gov. Merit aid – based on high SAT/ACT scores and must maintain a 3.25 gpa.

  16. Sources of Financial AidFederal (all need based) • Campus Based Aid: based on the level of demonstrated need and the amount available at each college. *Supplemental Education Opportunity Grant (SEOG) *Perkins Loan (5% interest). Repayment begins 9 months after graduation. *Federal Work Study (rate of pay varies)

  17. Sources of Financial AidFederal (all need based) • Stafford Loan or Direct Loan(Subsidized or Unsubsidized) • $3500 Freshman / $4500 Sophomore / $5500 Junior & Senior (Annual Limits) • An additional $2,000 may be borrowed per year beyond these annual limits; unsubsidized only • Subsidized Loan: loan amount is used to meet demonstrated need. Repayment begins 6 months after graduation. Interest rate set by federal government. All 2009-10 loans at 5.6%. Colleges may be lenders (direct) or you may apply through a bank. $31,000 would be the max to borrow. 10 years to repay.

  18. Sources of Financial AidFederal (all need based) • Unsubsidized Loan: Student has no demonstrated need or other forms of aid are meeting need. Repayment on interest portion of the loan while in college. Repayment on principal begins 6 months after graduation. Interest rate at 6.8%. • Stafford Loans or Direct Loans are student loans. The student will repay.

  19. Sources of Financial AidState (need and merit based) • TAP:Need Based • Grant assistance available to New York State residents who graduated from a NY high school and attend a college in NYS (2 year or 4 year, public or private). • Minimum Award $500 • Maximum Award $5000 (private college) / 90% SUNY tuition (state supported colleges) • Renewable for 8 full time semesters. Funding contingent upon state budget approval. 10 semesters for HEOP or EOP students.

  20. Sources of Financial AidState (need and merit based) continued • New York State Scholarships for Academic Excellence:Merit Based Each high school gets one $1500 award and school size determines the number of $500 awards. • Leaders of Tomorrow Lottery Scholarships: Merit Based Each high school receives one $1250 scholarship. Renewable for four years. Student must attend full time and maintain a 3.0 gpa. • Math and Science Teaching Incentive Scholarship: MeritBased Apply beginning spring of freshmen year. $4,350 retroactive for the year. Teaching service obligation for the recipient. You must reapply each year and academic performance determines if renewed.

  21. Sources of Financial AidInstitutional (need and merit based) • No Need/Merit Based Scholarships: • Awarded without regard to demonstrated need. • Based on Academic Ability • Athletic Ability (Div. I or Div. II, NCAA or NAIA) • Special Talents and abilities (Artistic, Musical, Dramatic, Leadership, etc. ) • Some colleges may require a separate application • Awards may be for one year only; some may be renewable • Merit aid may be combined with need based aid to meet demonstrated need

  22. Sources of Financial AidInstitutional (need and merit based)continued • Need Based Scholarship or Grant: • Awarded based on demonstrated need and academic ability (FAFSA must be filed) • Grant-in-aid for athletic ability (Div. I or Div. II). • May be combined with merit based financial aid • Renewable based on changing demonstrated need and level of achievement each year in college.

  23. Sources of Financial AidOutside Sources (need and merit based) • Employer, high school organizations, community organizations, philanthropic organizations, etc. • Private loans for students. Fewer lenders participate. Higher interest rates than Stafford Loans. Co-signer needed. Stringent credit check. Interest rates can range between 5 – 13.5% plus origination fees from 0 – 6%. • Numerous free web sites (www.collegeboard.comor www.fastweb.com). Do not pay money to get money! • Outside sources may impact the financial aid package • When notified of outside awards colleges may reduce their own aid. • Most outside awards are smaller amounts so impact on aid package is modest • Total need based aid received may not exceed demonstrated need

  24. Financial Aid Package:Meeting Full Need • Assumptions: • Student will attend college in NYS. • Family has one in college. • The college has resources to meet the full demonstrated need of each student who applies for aid.

  25. Financial Aid PackageMeeting Full Need

  26. Financial Aid PackageMeeting Full Need • Most colleges do not have the resources to guarantee that full need will be met. Those that can typically have very large endowments and a lower percentage of students requiring need based aid.

  27. Financial Aid Package: PreferentialPackaging • Packaging Scenario: John Doe • Top 15% of high school class • 90 unweighted average (3.5 gpa) in core subjects • 1780 SAT (600 Critical Reading/600 Math/580 Writing) • graduating from a NYS high school • Intended major: Biology • Family: • Federal AGI $90,000 • Family of 4 • 1 in college • NYS taxable income $73,000

  28. Financial Aid Package: PreferentialPackaging • College A: • Highly selective (less than 50% of applicants admitted) • Mean SAT: 1950 • Mean grade point average: 3.75 • Yield on admits to deposit: 35% • Located in the Midwest • Top three programs: Political Science, Economics, Biology

  29. Financial Aid Package: PreferentialPackaging • College A: • Cost of Attendance: Tuition $32,000 Room/Board $10,500 Fees $ 1,000 Books $ 1,000 Personal/Travel $ 1,500 Total $46,000

  30. Financial Aid Package: Preferential Packaging • College A: • Demonstrated Need: Cost of Attendance $46,000 • Family Contribution (FM) - $13,000 Demonstrated Need $33,000 • Package: • Federal Stafford Loan(subsidized) $3,500 • Federal Work Study(@ $7.75 per hr) $2,000 • College A Grant $17,500 • Regional Scholarship $4,000 • Total Aid Offered $27,000

  31. Financial Aid Package: Preferential Packaging • College A: Demonstrated Need $33,000 Total Aid Offered $27,000 Gap $ 6,000 Family Contribution (IM) $19,000

  32. Financial Aid Package: PreferentialPackaging • College B: • More Selective (70% of applicants admitted) • Mean SAT: 1750 • Mean grade point average: 3.5 • Yield on admits to deposit: 29% • Located in the Northeast USA • Top three programs: Business, Communications, Music

  33. Financial Aid Package: PreferentialPackaging • College B: • Cost of Attendance: Tuition $24,500 Room/Board $ 9,500 Fees $ 1,000 Books $ 1,000 Personal/Travel $ 1,000 Total $37,000

  34. Financial Aid Package: Preferential Packaging • College B: • Demonstrated Need: Cost of Attendance $37,000 • Family Contribution (FM) - $13,000 Demonstrated Need $24,000 • Package: • Federal Stafford Loan(subsidized) $3,500 • Federal Work Study(@ $7.75 per hr) $2,500 • Federal Perkins Loan $1,500 • College B Merit Scholarship $14,500 • Total Aid Offered $22,000

  35. Financial Aid Package: Preferential Packaging • College B: Demonstrated Need $24,000 Total Aid Offered $22,000 Gap $ 2,000 Family Contribution (IM) $15,000

  36. Financial Aid Package: PreferentialPackaging • College C: • Less selective (90% of applicants admitted) • Mean SAT: 1590 • Mean grade point average: 3.1 • Yield on admits to deposit: 32% • Located in New York State • Top three programs: English, Education, Biology

  37. Financial Aid Package: PreferentialPackaging • College C: • Cost of Attendance: Tuition $23,000 Room/Board $ 9,000 Fees $ 1,000 Books $ 1,000 Personal/Travel $ 1,000 Total $35,000

  38. Financial Aid Package: Preferential Packaging • College C: • Demonstrated Need: Cost of Attendance $35,000 • Family Contribution (FM) - $13,000 Demonstrated Need $22,000 • Package: • College C Merit Scholarship $16,000 • New York State TAP $ 500 • Federal Perkins Loan $2,000 Federal Stafford Loan (subsidized) $3,500 • Campus Employment $1,000 • Total Aid Offered $23,000

  39. Financial Aid Package: Preferential Packaging • College C: Demonstrated Need $22,000 Total Aid Offered $23,000 Gap $ 0 Cost to Attend $ 12,000

  40. FYI’s • You must reapply for financial aid each year (Renewal FAFSA). How has your situation changed? File electronically and receive an electronic renewal form. • If awards are renewable, make sure you have met eligibility criteria. • Make sure to read your financial aid award letters carefully from each college. Do the math! • Make sure you know the college costs for the year the student will attend. • Recommendation: File your FAFSA and subsequent year’s Renewal FAFSA on line. File on time!

  41. FYI’s continued • Students who are not Work-Study eligible may seek employment on campus. Pay is usually the same as work study. • Timing and accuracy are crucial to receiving your aid awards well before published deposit due dates. • Financial aid awards are only good until May 1 for Regular Decision, Early Action, and Rolling Admission admits. • Any delay on a decision to attend may jeopardize your package. • Early Decision admits usually have only 30 - 45 days after their acceptance before enrollment deposit is due. Complete early forms well before due dates.

  42. Parent Options • Parent Loan for Undergraduate Students (PLUS): • Parents may borrow up to the full cost of attendance less any financial aid received by the student. • Interest rate is 8.5% (7.9% at a Direct loan college). Interest cap is 9%. • Caution: some colleges put PLUS into your financial aid package to make it appear that you owe nothing. • You must prove credit worthy • Consider PLUS before borrowing a private education loan • Monthly Payment Plans: • some colleges offer their own • others may work with companies that specialize in this (ex. Tuition Pay/Sallie Mae or Tuition Management System)

  43. Questions? Tom DaRin Vice President for Enrollment Management Nazareth College, Rochester, NY 14618 585-389-2830 tdarin2@naz.edu www.naz.edu

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