Financial Aid Information Session

What is Financial Aid?

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Financial aid is money intended to help students pay for their educational expenses. Typically, aid comes in one of the following forms:

• Scholarships• Grants (Federal and State)• Federal Work Study• Loans

The last three types of aid are all applied for in one single application – the Free Application for Federal Student Aid or the “FAFSA.”

Best Advice:

APPLY!!!

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Applying… Easy as 1, 2, 3

1.) www.PIN.ed.gov

2.) www.FAFSA.gov

3.) Follow up:UW-Milwaukee Department of Financial

Aid http://www4.uwm.edu/financialaid

Applying Online:• Detects common errors before submission

• Skip logic: asks only what you must answer

• English or Spanish versions

• Electronic Signature

• E-mail notification of results

• Instant access to EFC estimate

• Faster Results

• Can list up to 10 different schools to receive your information

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Frequent FAFSA Errors• Missing Signatures/PIN

• Wrong Social Security Number

• Using nickname instead of name on SSN card

• U.S. Taxes Paid

• Divorced/remarried parent information

• Household size

• Number in postsecondary education

• NOT APPLYING AT ALL

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What do you need to complete the FAFSA?• Personal Information for Student and Parent(s)

– Social Security Number

– Driver’s License

• Financial Information for Student and Parent(s)

– 2010 taxes and W-2’s

– Bank statements

– Asset information

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*If you are prepared before you start, the entire application can be completed in about 45 minutes.

Expected Family Contribution (EFC)

(Federal Methodology established by U.S. Congress)

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Determined by filing the FAFSA

Main Determinants of the EFC• Income• Assets• Family Size• Number in College• Age of Parent

Assets and the FAFSA Assets Not Included

• Home in which you live• Value of life insurance

and retirement plans (pensions, annuities, Keogh’s non-education IRA funds, etc.)

• Personal vehicles

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Assets Included•Cash, Savings & Checking Accounts•Value of business land, buildings, equipment, inventory, etc. for companies with 100 or more employees.•Education IRA’s•College Savings Plans (529’s) ***Any questions about what should or should not be included, you may contact your school’s Financial Aid Office.

Myth #1: If I have savings I won’t get Financial Aid!Fact:

FAFSA counts a fraction, not ALL of a family’s assets in determining financial need.

A portion of assets are sheltered by an asset protection allowance.

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An Example:

• A typical family with college-age children would have about $50,000 of assets sheltered.

• In the end, 4% of dependent children have any contribution from parent asset in the EFC calculation

Source: www.finaid.org

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Myth #2: If I move my child’s 529 college savings plan to his name, he will be eligible for more aid.Fact:

Child’s assets are assessed at a 20% rate; parent assets assessed at a rate of no more than 5.64%

On average every $10,000 in a 529 plan may reduce need based aid by up to $564, but it still leaves you with at least $9,436 more available than if you hadn’t saved

Source: www.finaid.org

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Application ProcessingSchool usually receive the results

and student the Student Aid Report (SAR) 1-2 weeks after submission

Within 3-5 weeks:

- You will get notification of your award via email

OR - Be asked via email to submit additional information,

* Verification process: 6-8 weeks13

Paying for College:Financial aid was created as the “BRIDGE” to Higher education.

All the information gathered on the FAFSA is to develop an understanding

of the household information.

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Cost of Attendance (COA)

Tuition and Fees Room and Board Transportation

Books & Supplies+ Miscellaneous Living ExpensesCost of Attendance (COA)

DO NOT confuse this with your bill – “Cost of Attendance” exceeds costs billed by the university and is meant as a “ceiling” to the amount of aid a student can receive.

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Financial Need DefinedCost of Attendance (COA)

– Expected Family Contribution (EFC)

= Financial Need

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What can we expect?• Your EFC and “financial need” determine the types of aid you will be eligible for:

– Grants

– Subsidized Loans and Federal Work-Study

– Unsubsidized Loans

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Grants• Grants are “gift money” from the federal and state

government which are meant to help the neediest families

• Some grant funds are limited and they are awarded on a first come, first serve basis, so it is important to apply early every year! Our Priority deadline is March 1st.

Federal Work Study

• Must have “financial need”

• Student is responsible for finding on-campus job

• Student receives a payroll check for money earned, does not get sent directly to pay for tuition

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Direct Stafford Loans• Subsidized

Stafford Loan– Interest rate 3.4%

– Will not accrue interest while in school

• Unsubsidized Stafford Loan

– Interest rate 6.8%

– Will accrue interest

Payments for BOTH loans are deferred until 6 months after graduation

Freshman Max = $5500

- $3500 Subsidized *As determined by “Need”

- $2000 Unsubsidized

Is there anything else I have to do?

• Master Promissory Note (MPN)

– Signed electronically with PIN

– Entrance loan counseling

• Both items can be completed at studentloans.gov

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What if it is not enough?• Often, financial aid is not enough to cover all expenses

ex: $8284 (Full-time tuition)

-5500 (Minimum Freshman Award)

That leaves, AT LEAST $2,784, without even considering housing, meals, and books.

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Additional Options– Parent PLUS

• 7.9% interest rate• Taken out in parent’s

name• Studentloans.gov

– Alternative Education Loans• Variable interest rate• Co-signer needed• Private lending institutions

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REMEMBER:

Re-apply early every year. FAFSA available every

January 1st.

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My FAFSA does not reflect what is happening now!!! What should I do?Answer: Talk to the Financial Aid Office,

please complete FAFSA with 2010 data

Examples include:

Divorce/Separation Loss of Income/Benefits

One-time Income Disability

Medical/Dental Expense K-12 School Tuition

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WWW.WISCONSINCOVENANT.WWW.WISCONSINCOVENANT.WI.GOVWI.GOV

• Graduate from a Wisconsin high school.

• Maintain at least a B average while in high school.

• Take classes in high school that will prepare me for entrance into higher

education and will meet or exceed college entrance requirements.

• Demonstrate good citizenship and engage in activities that support my

community.

• Apply for state and federal financial aid in a timely manner.

• Apply and do all that is necessary to gain admission to a University of Wisconsin

System institution, a Wisconsin Technical College, and/or a Wisconsin private

college or university.

Get HelpCollege Goal Wisconsin

• Free program to help families complete the FAFSA

• February 19-20, 2011• Scholarship drawing at each site• 30 sites throughout Wisconsin

For location information: visit www.wicollegegoalsunday.org

or call 1-866-578-4625

Questions?

Thank You for your time!

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