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Financial Aid Basics for Parents

Join Chad A. Spencer, Associate Dean of the Office of Admission and Financial Aid, as he covers vital information for parents navigating the financial aid process. Learn about applying for aid, understanding the cost of attendance, and differentiating between need-based and merit-based aid. This session will also address the significant components of financial aid packaging, provide consumer tips, and answer your questions about making higher education accessible for your child. Equip yourself with knowledge to support your family’s education journey!

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Financial Aid Basics for Parents

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  1. Financial Aid Basics for Parents Chad A. Spencer Associate Dean Office of Admission and Financial Aid

  2. What will we cover? • Applying for Aid • Cost of Attendance • Need-Based Aid • Merit-Based Aid • Packaging • Consumer Tips • Questions

  3. What are the purposes of need-based financial aid? • Make higher education accessible to students who can’t afford it on their own • Enable student to apply to first-choice college • Attend college based on best fit • Equity in distributing limited funds

  4. What assumptions lie behind need-based aid? • Students and parents contribute to the extent they’re able • Similar treatment for similar circumstances • More expected from those with greater resources

  5. How do students apply for financial aid? FAFSA • Free Application for Federal Student Aid • www.FAFSA.ed.gov CSS Profile • Profile online - CollegeBoard.org At College’s Discretion • Tax returns and W-2 forms • Non-custodial Parent PROFILE • Institutional application

  6. Dependent or Independent? Federal Definition • Were you born before Jan. 1, 1989? • As of today, are you married? • Will you be working on a master’s or doctorate? • Are you currently serving on active duty in the US Armed forces (other than training)? • Are you a veteran of US Armed Forces? • Do you have children who live with you and receive more than half their support from you? • When you were 13, were both your parents deceased, were you in foster care or a ward of the court?

  7. Dependent or Independent, continued • Are you an emancipated minor as determined by a state court? • Are you in legal guardianship as determined by a state court? • Have you been declared by an emergency shelter director funded by HUD to be a homeless unaccompanied minor? • Did the director of runaway/homeless shelter determine you to be homeless or self-supporting

  8. How is aid eligibility determined? Cost of education - Expected Financial Assistance from outside resources - Family contribution = Student’s financial need

  9. What is included in cost of education? • Tuition and fees • Room and board • Books and supplies • Transportation • Miscellaneous personal expenses

  10. Other optional costs might be included? • Computer • Health Insurance • Child/dependent care costs • Specialized equipment • Supportive needs

  11. What are outside resources? • Scholarships from non-institutional sources • Clubs and civic organizations • Churches • Employers • Foundations • Certain types of benefits • Private gifts

  12. How is the family contribution determined? • Parent contribution from income (after allowances) • Parent contribution from assets (after allowances) • Student contribution from income and assets

  13. What are merit-based scholarships? • Availability varies from institution to institution • Typically awarded after student is admitted • Procedures for being considered vary • Nomination • Scholarship application • Admission application

  14. Questions To Ask About Merit-Based Aid • Is the scholarship renewable? • If so, what are the requirements for renewal? • Will it affect my need-based aid eligibility?

  15. What are athletic scholarships? • Usually awarded by athletics department, not the admission/financial aid office • Partial and Full scholarships

  16. What are the components of a financial aid package? • Gift Aid • Grants (Institutional, Federal, and State) • Merit-Based Scholarships • Self Help • Student Employment • Loans • Direct Stafford Loan (Student) • Perkins Loans (Some institutions) • Direct PLUS Loans (Parent) • Alternative Loans

  17. Recap: What is financial need? Budget Personal Expenses Transportation Books and Supplies Need EFC Room and Board EFA Tuition Student Contribution _ _ = Estimated Financial Assistance From Outside Resources Parent Contribution

  18. How is need met?Sample Aid Packages

  19. Other Helpful Options • Summer/academic year employment • Payment plans • Federal Direct Stafford Loans • Federal Perkins Loans (at some institutions) • Federal Direct PLUS Loans • Lines of credit and Home equity loans

  20. What are other things you should know? • Deadlines are important • Early Decision/Early Action • Net Price Calculators • Need-blind vs. need-sensitive • May 1: National Candidates Reply Date

  21. What about the current economic situation? • Institutions may choose to consider individual family circumstances at different times throughout year • Might affect a family’s funding options • Might not affect family contribution

  22. Consumer Tips • Fee-based financial aid consultants? • Avoid scholarship programs that charge application fees • Avoid scholarship search services that charge fees

  23. On-line Resources • The College Board www.collegeboard.org • SmartStudent Guide to Financial Aid www.finaid.org • Federal government www.ed.gov • Scholarship Web sites • School Web sites • www.davidson.edu

  24. Questions?Thank you!Chad A. SpencerAssociate DeanOffice of Admission and Financial Aid

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