financial aid troy martin director of financial aid st. bonaventure university
TRANSCRIPT
FINANCIAL AID
Troy Martin
Director of Financial Aid
St. Bonaventure University
St. Bonaventure University
Majors/Programs: More than 50 undergraduate majors and programs including pre-health dual admissions programs, and 20 graduate programs, two of which are available 100% online.
Financial Aid: More than 95% of students receive financial aid.
Knowledge is an investment
If a man empties his purse into his head, no one can take it from him. An investment in knowledge always pays the highest return.– Benjamin Franklin
The Value of a College Education
Master’s degree $69,108
Bachelor’s degree $57,616
High school diploma $33,852
According to the US Bureau of Labor Statistics in 2013, average yearly earnings are higher for college graduates and unemployment rates are lower:
Highest Degree
Unemployment Rate
Master’s 3.4%
Bachelor’s
4.0%
High School
7.5%
What is Financial Aid?
Financial aid consists of funds provided to
students and families to help pay for college
expenses
Goals of Financial Aid: Affordability To provide Access -- regardless of
income To provide Choice -- regardless of cost To Recruit -- desirable students
Paying for college is a “partnership” between the student, parents, college, government, and outside sources
Financing a College Education Myths
Students with the best grades get all the aid
Income is too high, we won’t qualify I have to attend the school the offers the
most aid Cost is the best way to compare schools Deadlines are not important
Financing a College Education Combination of resources --
FamilyFederal GovernmentState GovernmentCollegePrivate Sources
Financing a College Education
•Work, pay as you go, or save up enough moneyHistorica
l approac
h
•Past - save start early, systematic, plan
ahead•Present -
adjust lifestyle, current
income,
grants and scholarships
•Future - loans, long term payments
Current approac
h
Equal Opportunity
In our democracy every young person should have an equal opportunity to obtain a higher education, regardless of his station in life or financial means.– President John F. Kennedy
Consider Net Cost not Sticker Price
Sticker Price is the amount listed for tuition, fees, room, and board
Net Cost is the amount after your financial aid is subtracted
Net Cost is much more important since it is what you actually pay out-of-pocket
Net Cost Comparison
Sticker Price$18,000
Financial Aid- $6,000
Net Cost= $12,000
Sticker Price$35,000
Financial Aid- $27,000
Net Cost= $8,000
School A School B
Financial Aid Applications
Free Application for Federal Student Aid (FAFSA)
Institutional Financial Aid Application
www.fafsa.gov
FAFSA
Free A standard form that collects
demographic and financial information about the student and family
It is used to determine financial need
Use it to apply for federal and state student grants, work-study, and loans
FAFSA
Information used to calculate the Expected Family Contribution or EFC
Colleges use EFC to award financial aid 2015-16 FAFSA available on January 1,
2015
FAFSA ID
Username Password Sign FAFSA electronically May be used by students and
parents throughout aid process, including subsequent school years
Tips Before Starting
Read instructions Do not complete and send prior to
January 1st Do not need to have tax returns
completed Do not have to wait until accepted for
admission All info “as of the date you complete
the form”
Frequent FAFSA Errors
Social Security Numbers Divorced/remarried parental
information Income earned by parents/stepparents Untaxed income U.S. income taxes paid Household size Number of household members in
college Real estate and investment net worth
Who Are Considered Parents on the FAFSA?
Biological or adoptive parents (regardless of gender)
Parents married and living with each other Parents unmarried and living with each other Parent widowed or single Parents divorced or separated - answer questions for parent with whom student lived more during past 12 months. If equal time between each parent, answer for the parent who provided more financial support during the past 12 months
If custodial parent has remarried, answer about that parent and the person whom parent married (stepparent)
Who Are Not Considered Parents on the FAFSA?
Foster parents Legal guardians who have not adopted the student
Relatives, such as grandparents, who have not adopted the student
Stepparents who have not adopted the student and the natural parent in the household is deceased. Must use remaining biological/adoptive parent, if any.
IRS Data Retrieval Tool
Dept. of Ed and IRS developed a solution to simplify FAFSA completion
While completing FAFSA applicant may submit real-time request to IRS for tax data
IRS will authenticate taxpayer’s identity If match found, IRS sends real-time
results to applicant in new window Applicant chooses whether or not to
transfer data to FAFSA
IRS Data Retrieval Tool
Available late January 2015 for 2015–16 processing cycle. Within a couple of weeks for electronic tax filers and a little longer for paper filers
Participation is voluntary Could reduce documents requested by
financial aid office
Principles of Need Analysis
To the extent they are able, parents have primary responsibility to pay for their dependent children’s education
Students also have a responsibility to contribute to their educational costs
Families should be evaluated in their present financial condition
A family’s ability to pay for educational costs must be evaluated in an equitable and consistent manner, recognizing that special circumstances can and do affect its ability to pay
Special Circumstances
Change in employment status Medical expenses not covered by
insurance Change in parent marital status Unusual dependent care expenses
Special Circumstances
Cannot be documented using FAFSA
Send written explanation and documentation to financial aid office at each college
College will review and request additional information if necessary
Decisions are final and cannot be appealed to U.S. Department of Education
What is the EFC?
Amount family can reasonably be expected to contribute (Expected Family Contribution)
Stays the same regardless of college Two components
Parent contribution Student contribution
Calculated using FAFSA data and a federal formula
Financial Aid Formula – How need is calculated
Cost of Attendance
- Expected Family
Contribution
= Financial Need
Need Varies Based on Cost
X
Y
Z
Cost of Expected Family NeedAttendance Contribution (Variable)
(Variable) (Constant)
1
2
3
EFC EFC
Net Price Calculator
Colleges are required to have estimating tools on their website allowing families to get a reasonable estimate of net costs.
College is a pathway to opportunity
In a global economy where the most valuable skill you can sell is your knowledge, a good education is no longer just a pathway to opportunity – it is a prerequisite.– President Barack Obama
Scholarships – based on merit Academic Scholarships Other merit-based scholarships
athletic, music, art, leadership, etc.
Endowed Scholarships Private
Local community organizationsEmployersInternet
Small scholarships add up!
Grants – based on need
Federal Pell Grant – up to $5,730 FSEOG – up to $4,000 New York State Tuition
Assistance Program (TAP) – up to $5,160
Institutional need-based grants
Student Employment
Federal College Work-Study ProgramOn-campus work program
Some positions are in community service
Usually minimum wagetypically 5 – 15 hours/weekMaximum earnings typically $1,500
to $2,500/year
Loans
Federal Perkins Loan – up to $5,500 William D. Ford Direct Loan
Subsidized Federal Stafford Loan - $3,500 (1st year)
Unsubsidized Federal Stafford Loan - $2,000 Federal Parental Loan for Undergraduate
Students (PLUS) Alternative/private education loans
Always borrow federal loans first
Other Sources
National and Community Service (AmeriCorps)
Veterans Benefits Military Service Scholarships
(ROTC) Vocational and Educational
Services for Individuals with Disabilities (VESID)
Information on the Internet
www.finaid.org www.studentaid.gov www.fastweb.com www.mappingyourfuture.org www.collegeboard.org www.salliemae.com www.nasfaa.org
Avoid Financial Aid Scams
Organizations that offer to locate more aid and then charge you a fee
Anyone who charges you a fee: for information about financial aid to complete the FAFSA to apply/receive a scholarship
Organizations that guarantee you will get a scholarship or aid
Financial Aid Calendar for Seniors January/February -- apply for aid March/April -- receive financial aid award
letter from college May 1st -- reply date Summer -- apply for loans September -- classes begin, aid applied
to account
529 College Savings Plans
Tax-exempt college savings vehicles with a low impact on need-based financial aid eligibility since considered as an asset of the account owner and not the beneficiary
FAFSA reporting: Parent - reported as parent asset Grandparent – not reported on the FAFSA However, distributions from grandparents
are considered “cash support” on the FAFSA in the following year
America Recovery and Reinvestment Act (ARRA) of 2009
American Opportunity Tax Credit – up to $2,500 per student for families with incomes less than $160,000
A Sample Financial Plan for St. Bonaventure
Friar’ Scholarship $16,000
NYS TAP $3,000
Outside/Private Scholarship $1,000
Monthly Payment Plan ($600/mo) $6,000
Student summer earnings $1,500
Federal College Work-Study earnings
$2,000
Federal student loans $7,500
Tax Credit $2,500
Savings, gifts, etc. $1,000
Total Resources $40,500
Helpful Hints
Apply Beware of scams Pay attention to deadlines Role of student Importance of grades Compare Ask questions!
The Value of St. Bonaventure University“At a time when colleges are
coming under a lot of scrutiny nationally, it’s reassuring to know that we’re still considered such a great value. People often become fixated on the literal bottom line without considering how generous our scholarship and aid packages are – and what they’re getting for that investment.”
- Sr. Margaret Carney, O.S.F., President upon hearing that SBU ranked #1 in New York State on US News & World Report list of best values in the North
QUESTIONS?Troy Martin [email protected] 716-375-2373
EFC for Dependent Student
Step 1: Determine available parental incomeTotal income (taxed and untaxed) – Excludable income (e.g., child support paid) – Taxes paid (i.e., federal, state, local, Social Security) – Income protection allowance for basic living expenses (e.g., food, shelter, etc.) – Employment allowance (if eligible) = Available income (may be negative)
EFC for Dependent Student
Step 2: Determine available parental assets Value of cash, savings, and checking accounts + Adjusted business/farm net worth (total value
minus debt against business/farm) + Investment/real estate net worth (excluding home) – Education savings and asset protection allowance (determined by age of older parent) x Asset conversion rate (12%) = Parental contribution from assets
EFC for Dependent Student
Step 3: Determine portion of available parental income and assets available for education Available income + Contribution from assets = Adjusted available income (AAI) x Assessment rate (varies) = Total parental contribution ÷ Number attending college (excluding parents) = Parental contribution for student
EFC for Dependent Student
Step 4: Determine student available income Total income (i.e., taxed and untaxed) – Excludable income – Taxes paid (i.e., federal, state, local, and Social Security) – Income protection allowance – Parental adjusted available income if < $0 = Student’s available income
EFC for Dependent Student
Step 5: Determine student contribution Student’s available income x 50% assessment rate = Income contribution from student + 20% of the student’s net asset worth = Student contribution
EFC for Dependent Student
Step 6: Determine Expected Family Contribution
Parental Contribution+ Student’s Contribution= Expected Family Contribution