paying for college financial aid overview 2014-2015
TRANSCRIPT
Paying for college
Financial aid overview2014-2015
General principles
• Everyone qualifies for some form of financial aid
• Free assistance is available.– You don’t have
to pay
What is financial aid?
• Grants
• Work-study
• Loans
• Scholarships
• Tuition waivers
• Tax credits and deductions
These types of aid are based on a family’s financial situation, household size, and # of dependents in college. To be eligible for these, FAFSA must be completed.
Scholarships can be merit-based, or based on achievement in other areas.
When you file your federal income tax return you or your parents may qualify for certain deductions
Undocumented residents of Texas
May qualify for Texas residency• HB 1403 /SB 1528• In-state tuition• State financial aid
• Not state loans
Eligibility example• Lived in Texas three years prior
to graduation from a Texas high school
Submit a FAFSA or TASFA• College determines application
The most important thing to remember is that a student does not have to be a U.S. Citizen to receive state financial aid. Each institution has its own procedures so contact the Financial Aid Office to find out what you need to do.Look at the College For All Texans website under “Residency” for more info.
The application: FAFSA
Free Application for
Federal Student Aid– Federal
– State
– Institutional*
It’s a good idea to contact the schools you are interested in to see if they require additional information. The FAFSA may be the only application needed, but it is better to be safe than sorry!
The application: TASFA
Texas Application for State
Financial Aid– Lived in Texas three years
prior to graduation or GED
– In-state tuition
– May qualify for some state aid
• Not state loans
For undocumented students. Ask your college for assistanct. Submit this as soon as possible. TASFA is calculated by hand and takes much longer to process than FAFSA.
The FAFSA
Students• Social security number• Completed IRS tax return• W2• Record of untaxed income• Record of investments• Current bank statements
Parents• Completed IRS tax return• W2• Record of untaxed income• Record of investments• Current bank statements
Documentation Necessary to Complete the FAFSA
Student status
Dependent • Need parents’ information
• Not tax filing related
Independent
• Do not need parents’
information– Have dependent(s)
– Married
Student status
Dependent • If parents are divorced or separated
– Use parent that lived with most or provided most support– If that parent is remarried use the spouses information also
FAFSA: common mistakes
Name does not match Social
Security Card - exactly
Putting same amount for AGI
and Income Tax
Not following up with correct
tax info Parents put their information in
place of the student’s Transposing numbers
Student status Not signing it / Not submitting it
Notify student
The process
Submit FAFSA
US Department of Ed(Calculates EFC)
Student accepts offer
School releases funds
SAR to student
School determines need
Award letter to student
Types of aid
• Grants
• Work-study
• Loans
Grants
• Free money
• Need-based
• Examples:– Texas Equalization Grant
(state)– Pell Grant (federal)
Work-study
• Students work to earn money
• Receive regular pay check
• Jobs• Majority are on campus
• Flexibility
• Provide valuable experience
Federal loans
• Must be paid back • Available for
– Students • Stafford
– Subsidized– Unsubsidized
– Parents• PLUS
• Low interest rates
• Various repayment terms
• Deferments
Federal Stafford Loan
• Students
• Repayment starts six months
– After graduation
– Dropping below half time
• No credit check required
Federal Stafford Loan
Subsidized Unsubsidized• Need-based • Non need-based
• Interest Doesn’t accrue
• In-school• Grace• Deferment
• Interest• Accrues but not
required to pay• Can be capitalized
PLUS Loan
• Parent borrows loan
– For dependent child’s educational expenses
• Parent receives funds
• Parent responsible for payment
• Credit check required
• Repayment - 60 days after second disbursement
• Deferment– Student / parent in school
Special circumstances
• Changes in income– Death, disability
– Unemployment, underemployment
• High medical/dental expenses
• Dependency status
• Cost of attendance (COA)
• Other
Scholarships
• Free money
• Merit-based– Academic– Class rank or GPA– Test scores
• Special skills– Music– Drama– Athletics– Art
Scholarship tips
• Start early
• Local
• On-line
• Reapply
Scholarship tips
• Know the rules
– Due date
– Essays
– Recommendation letters
• Send everything
requested
• When possible get return
receipt
• Proofread
Scholarship tips
Avoid pitfalls
• Ignoring details
• Using the same essay
• Forgetting federal and
state programs
Scholarship scams
FTC cautions families to look for these signs
• Guaranteed or your money back
• Credit card or bank account
• Can’t get information anywhere else
• We do all the work
• Will cost some money
• Selected by national foundation