Paying for College

1. Paying for College Financial Aid Basics Beyond & James Hammar Assistant Director of Financial Aid University of St. Thomas

2. The best thing you can do… • Outside scholarships • Free Application for Federal Student Aid • Special Circumstances Agenda

3. Financial Aid Basics How America Pays For College 2013 : Sallie Mae/IPSOS Who pays for college?

4. Apply early. • One less thing to worry about • Gives the student more time to focus on searching for scholarships and preparing for the FAFSA • Gives schools the information they need to start the financial aid process and keep students informed The best thing Seniors can do…just apply!

5. Apply early. • Scholarships offered at the time of admission may be less generous the closer we get to the May 1 decision date. • Schools may have other opportunities that they only invite accepted students to apply for. • Students should not wait to apply because they are planning to retake a test. Timing is everything

6. Financial Aid Basics • Do your homework • Plan to take/retake ACT or SAT test this summer • Talk to seniors about applying to colleges and searching for scholarships • Work over the summer and save for college • Visit every college you are seriously considering and meet with admissions and financial aid What can Juniors do right now?

7. Most scholarships for high school seniors will have deadlines in Jan. – April • Start locally, think globally • Make college and scholarships part of every conversation you have with adults over the next year • Set realistic goals and stick to them Outside Scholarships Outside Resources

8. Set up a new, free email account to use for your scholarship search • Answer optional questions. This will yield more/better results. • Students should never pay for scholarships or services that “guarantee” they will find the student scholarships • Use college websites whether you plan to attend or not Using Free Scholarship Search Engines Outside Resources

9. FAFSA • Universal application • 97% of students file online • Students must re-apply each year • Determines Expected Family Contribution (EFC) • Regardless of EFC, all students are awarded financial aid Free Application for Federal Student Aid

10. FAFSA • The 2014-2015 FAFSA is now available online at www.fafsa.gov • Prepare taxes earlyand file electronically if possible • The student and one parent need a PIN to sign FAFSA electronically • Talk with schools about priority filing date and school code FAFSA Continued…

11. fafsa.gov PIN Site www.pin.ed.gov Fill Out Your FAFSA Look up federal school codes Print a Paper FAFSA

12. Taxpayers may choose to transfer their IRS data directly to the FAFSA. Tax data should be available within 10 days after taxes are filed electronically with the IRS. For best results : File taxes early and electronically Wait two weeks File FAFSA using IRS data transfer If you file with estimated data you should update FAFSA using IRS transfer when possible.

13. Students should always try to meet each schools priority filing date. This is the only time it is advised they estimate. • It is more important that high-need students meet priority filing dates • Estimating will increase student’s chances of being selected for verification, slowing the whole process down • An award based on estimated information is really just an estimate. It is subject to change when actual data is available • Parents may not be able to use the IRS Data Retrieval Tool if: • They owe taxes • They file as “head of household” or “married filing separately” • They amended their taxes • They filed a foreign tax return Should you estimate?

14. Investment real estate • Trust funds • Money market funds • Mutual funds • Certificates of deposit • Stocks and bonds • 529 College savings plans • Business value (if you employ 100+ people) Reporting Assets on FAFSA Only “unprotected” assets must be reported on the FAFSA

15. Avoid Errors • List your name and SSN on the FAFSA exactly how it appears on your social security card. • Don’t leave any fields blank. If entry is zero or none, enter 0. • Enter all school code(s). • Both student and one parent must sign a dependent student’s FAFSA. Other FAFSA Tips

16. Financial Aid Basics • Scholarships (merit-based) • Grants (need-based) • Work-study (must be earned) • Student loans (must be repaid) • Education Tax Credits (claimed) Types of Financial Aid Financial Aid Basics

17. How is financial need determined?

18. If you have a special circumstances, you should: • File the FAFSA using previous tax year data • Contact each school to talk about their process • Collect necessary documentation and provide copies to each Financial Aid Office. • The federal government allows schools to adjust FAFSA results for: • Changes in household size (divorce, death, etc.) • Medical expenses not paid or reimbursed by insurance • Private education expenses (K-12) • Reductions in income or unemployment of a parent Special Circumstances

19. Past earnings (savings) • Every dollar saved for college could earn you a dollar after college in the form of reduced interest payments Current earnings (work-study) • Working while in college should not be seen as optional. Whether on-campus or not, working while in school helps students build valuable skills, connections, and a resume of experience. Future earnings (student loans) • For every $10,000 a student borrows while in school, they will repay approximately $100 per month over a standard 10-year repayment.* • If a first-choice institution costs $50,000 more than a second option offering an equivalent degree, the student needs to earn $6,000 more in a starting salary for that degree to be ‘worth it’. * Assuming a fixed interest rate of 5.0 percent How student pay their share

20. Estimates your EFC based on a few questions • Estimates aid from the school and government sources • Compares cost and aid to provide “net price” or true cost to student/family • Useful planning tool but the estimate is only as good as data provided Net Price Calculators

21. Other Questions?