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Financial Aid 101 De-Mystifying the Process

Financial Aid 101 De-Mystifying the Process. John Iacovelli Dean of Enrollment Management Richard Stockton College of New Jersey. Goal of Financial Aid. Primary goal is to assist students in paying for college and is achieved by: Evaluating family’s ability to pay for educational costs

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Financial Aid 101 De-Mystifying the Process

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  1. Financial Aid 101De-Mystifying the Process John Iacovelli Dean of Enrollment Management Richard Stockton College of New Jersey

  2. Goal of Financial Aid Primary goal is to assist students in paying for college and is achieved by: • Evaluating family’s ability to pay for educational costs • Distributing limited resources in an equitable manner • Providing a balance of gift aid and self-help aid

  3. Sources of Aid • Federal • State • The University/College • Private • Civic organizations (i.e., local Rotary Club, parent’s employer, high school awards, etc.)

  4. Types of Financial Aid • Scholarships • Grants • Loans • Employment Opportunities

  5. Merit-Based Aid vs. Need-Based Aid • Merit-Based Aid - aid given to students strictly on the basis of merit. May be based on: • Academic record • Special characteristics • Skills or talents • Involvement • Does not have to be repaid; may be renewable from year to year. • Need-Based Aid - aid awarded to students on the basis of financial need. Re-evaluated each year as financial situations may change.

  6. Grants • Federal • PELL • SEOG • State • TAG • EOF • Institutional • Private Grants and Scholarships

  7. Loans • Federal Perkins Loan (5%) • Federal Direct Loan Program • Subsidized Loan (4.66%) • Unsubsidized Loan (4.66%) • PLUS (7.21%) • Loan Limits: • First-year students – $3,500 • Second-year student – $4,500 • All other grade levels remain at $5,500 • All students eligible for additional $2000 of unsubsidized loan.

  8. NJ Class Loan • NJ Class Supplemental Loan Program • Low fixed interest rates beginning with: • 10 Year Repayment Loan of 5.99% • Immediate Repayment of Principal & Interest Only • 15 Year Repayment Loan(s) of 6.95% • Immediate Repayment of Principal & Interest Only • Immediate Repayment of Interest Only, while in school • 20 Year Repayment Loan of 8.4% • Full deferment until out of school

  9. Application Process • Submit the Free Application for Federal Student Aid (FAFSA) prior to the college’s deadline • To ensure maximum consideration for federal, state, and institutional aid, check information from each college to determine: • Required application materials • Application deadlines

  10. Free Application for Student Aid(FAFSA) • FAFSA on the Web at www.fafsa.gov • Collects family’s personal and financial information used to calculate the student’s EFC

  11. To Register for a Pin:www.pin.ed.gov

  12. A FAFSA Must Be Filed on the Web

  13. Common Mistakes Madeon the FAFSA • Correct name, social security #, birth date • Number of people in the household • Divorced/remarried households • Taxes paid vs. taxes withheld • Parental and student assets • Worth of a second home • “Zero is a number”

  14. Definition of Need Cost of Attendance (COA) – Expected Family Contribution (EFC) = Financial Need

  15. What is EFC? • Basis of financial aid package • EFC is determined by a federal formula that calculates need via the FAFSA • EFC & Financial Need are guidelines used by schools to determine a financial aid package • EFC not necessarily equal to the out-of-pocket cost of the family

  16. Cost of Attendance • Tuition and fees • Room and board • Books and supplies, equipment, transportation, and miscellaneous personal expenses • Study abroad costs • Dependent care expenses • Expenses related to a disability • Expenses for cooperative education program

  17. 1 X 2 Y 3 Z EFC EFC Cost of Attendance (Variable) Expected Family Contribution (Constant) Need (Variable) Need Varies Based on Cost

  18. The Cycle of Financial Aid Jan-March • Student /Parents complete FAFSA March-April • School sends award letter June-July • School sends Fall semester bill

  19. HESAA and Federal Student Aid Services • HESAA Web Site www.hesaa.org • HESAA Financial Aid Hotline • 800-792-8670 8:00 am – 8:00 pm Monday thru Thursday 8:00 am – 5:00 pm Friday • NJBEST – College Savings Plan • Federal Aid Website and Toll-free Numberwww.studentaid.gov/completefafsa1-800-433-3243

  20. Additional Resources • Services and Forms: Fin Aid! “The SmartStudent Guide to Financial Aid”: www.finaid.org USDE Publications : www.studentaid.ed.gov/students/publications/FYE/index.html FastWebwww.fastweb.com FAFSA on the Web: www.fafsa.gov U.S. Department of Education PIN: www.pin.ed.gov“Practice” FAFSA:www.fafsa4caster.ed.gov

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