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Financial Aid 101- The Basics

Financial Aid 101- The Basics. Agenda. Financial aid history & philosophy of Free Application for Federal Student Aid Calculating financial aid Cost of attendance (COA) Expected Family Contribution (EFC) Categories, types, and sources of financial aid Special circumstances.

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Financial Aid 101- The Basics

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  1. Financial Aid 101- The Basics

  2. Agenda • Financial aid history & philosophy of • Free Application for Federal Student Aid • Calculating financial aid • Cost of attendance (COA) • Expected Family Contribution (EFC) • Categories, types, and sources of financial aid • Special circumstances

  3. History of Financial Aid U.S. Congress passes laws that promote national prosperity: Economic 1. 2. Social National defense 3.

  4. Philosophy of Financial Aid • Students and their families have the primary responsibility to pay for postsecondary education expenses Note: even if the student has left the household

  5. Philosophy of Financial Aid • Making a college education more attainable • Providing a consistent and equitable evaluation • Ensuring eligible students benefit from financial assistance

  6. General Application Process FAFSA via Telephone Federal Application Processing System IRS Data Match

  7. FAFSA on the Web Reasons to file electronically: • Faster processing • Built-in edits prevent costly errors • Skip logic allows student and/or parent to avoid unnecessary questions • Use Internal Revenue Service (IRS) data retrieval

  8. FAFSA on the Web Reasons to file electronically: • Easier corrections & updates • Comprehensive instructions and “help” for common questions • Check status on-line • Simplified renewal application

  9. 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

  10. Initial Student Eligibility • High school diploma or equivalent • U.S. citizen or eligible non-citizen • Valid Social Security number • Enroll in an eligible degree or certificate program • Register with Selective Service (males only) • Sign a statement of educational purpose

  11. Maintaining Student Eligibility • Not be in default or owe an overpayment on a grant • Maintain Satisfactory Academic Progress (SAP) • No drug convictions based on Department of Education standards

  12. Calculating Financial Aid Eligibility

  13. What is Financial Aid? Funds provided to students to help pay for postsecondary education expenses. Financial aid includes • Grants • Scholarship • Work study • Loans

  14. Cost of Attendance (COA) Note: Costs vary from institution to institution

  15. Expected Family Contribution (EFC) • EFC is the measure of a family’s financial strength • EFC is used to determine the student and parent ability to contribute towards the student’s cost of education • Need analysis is the consistent formula used in determining a family’s EFC

  16. Expected Family Contribution:The Counselor’s Role Do • Encourage students at all income levels to apply • Refer students to the college’s Net Price Calculator* Do not • Assess eligibility • Promise eligibility * only an estimate not a guarantee

  17. Calculating Eligibility For Need-Based Aid Cost of Attendance (COA) • Expected Family Contribution (EFC) • Eligibility for Need-Based Aid

  18. Types of Financial Aid

  19. Calculating Eligibility Need-Based Aid—2012-2013 Federal Programs

  20. Calculating Eligibility Need-Based Aid-2012-2013 California Programs

  21. Calculating Eligibility Non Need-Based Aid Students who do not demonstrate eligibility for need-based aid may still quality for: • Federal unsubsidized Direct loan • Federal Direct PLUS loan • Private sector scholarships • Institutional scholarships and employment programs

  22. Special Circumstances

  23. Special Circumstances • If students and families have unusual circumstances, advise them to contact the financial aid office at the college they plan to attend; the office will advise them on how to proceed.

  24. Special Circumstances • Cannot be reported on the FAFSA • Contact the financial aid office for procedures • School’s decision is final and cannot be appealed to Department of Education

  25. Special CircumstancesExamples • Change in employment status • Dislocated workers/Loss of employment • Change in parent marital status • Medical expenses not covered by insurance • Elder care expenses • Unusual dependent care expenses

  26. Special Circumstance Examples: What if…student related changes • Student cannot obtain parent information • Homeless individuals

  27. Professional Judgment and Dependency Status The Financial Aid Office has authority to make a dependent student independent if unusual circumstances exist: • An abusive family environment • Abandonment by parents • Inability to locate parents

  28. Professional Judgment and Dependency Status Do not qualify as “unusual circumstances” • Parents refuse contribution towards education • Parents unwilling to provide information on the application or for verification • Parents not claiming the students as a dependent for income tax purposes • Student demonstrating total self-sufficiency

  29. Remember… If your student and family have unusual circumstances, advise them to contact the financial aid office at the college they plan to attend; the office will advise them of how to proceed.

  30. Questions?

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