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How to set yourself apart from everyone else

Financial Aid. SCHOLARSHIPS. How to set yourself apart from everyone else. Objectives. Define financial aid Describe the major financial aid programs Explain the application process Describe what happens after that Show you what aid is available Answer your questions. Financial aid is….

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How to set yourself apart from everyone else

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  1. Financial Aid SCHOLARSHIPS How to set yourself apart from everyone else

  2. Objectives • Define financial aid • Describe the major financial aid programs • Explain the application process • Describe what happens after that • Show you what aid is available • Answer your questions

  3. Financial aid is… • Gift aid (32% of all aid) • Scholarships • Grants • Self help aid (68%) • Loans (66%) • Employment opportunities (2%)

  4. Financial aid can be… • Merit based • Eligibility is based on a specific attribute: grades, community service, athletic ability, etc. • Need based • Eligibility is based on the family’s financial situation (as determined by a federal formula from information provided on the FAFSA). This is what we are primarily covering in this presentation.

  5. How is need determined? • Definition of need: Cost of Attendance (school determines) - Expected Family Contribution (EFC from the FAFSA) ________________________________ = Financial Need

  6. Different School = Different Need A B a b c C EFC EFC _ Cost of Attendance (variable) Expected Family Contribution (constant) Need (variable) =

  7. School 1 Cost $26,000 EFC - 8,000 Eligibility = 18,000 Aid $ 18,000 Unmet $ 0 Price $ 8,000 School 2 Cost $14,000 EFC - 8,000 Eligibility = 6,000 Aid $ 5,500 Unmet $ 500 Price $ 8,500 Price vs. Cost

  8. Principles of Need Analysis • To extent they are able, parents have primary responsibility to pay for dependent child’s education • Students also have responsibility to contribute to educational costs • Families should be evaluated in their present financial condition • Family’s estimated ability to pay educational costs must be evaluated in equitable and consistent manner, recognizing that special circumstances may affect family’s ability to pay

  9. What is the FAFSA? • Free Application for Federal Student Aid • File as soon after January 1st • Annual application • Paper version (request by calling 1.800.4.FED.AID) • Electronic : www.fafsa.ed.gov(preferred) • Quicker • Electronic signature with a PIN (parent and student) • More accurate • Information provided determines eligibility for aid • Beware of scams….it’s FREE! • Watch deadlines!

  10. Before you Begin • PIN – if filing online – http://www.pin.ed.gov • Documents needed to start the FAFSA: • Your social security number • Your driver’s license • Your 2009 W-2 Forms and other records of money earned • 2009 tax return => 2009 tax return • Bank statements, investments, W2’s • Veterans benefits records, Child support received • Men- if 18 must register w/ the Selective Services • If entering college at 17, can register 6 months prior to 18th birthday

  11. General Student Eligibility Criteria • Must be enrolled or accepted for enrollment in eligible program of study • Must be pursuing degree, certificate, or other recognized credential • Must be U.S. citizen or eligible non-citizen • Must be registered with Selective Service (if male and required) • May not have eligibility suspended or terminated due to being convicted of a drug-related offense

  12. Dependency Status • Were you born before January 1, 1986? • At the beginning of the 2009-2010 school year, will you be working on master’s or doctorate program ? • Are you currently serving on active duty in the U.S. armed Forces for purposes other than training? • Are you a veteran of the U.S. Armed Forces? • Do you have children who will receive more than half of their support from you between July 1, 2009, and June 30, 2010? • Do you have dependents who live with you and who receive more than half of their support from you, now and through June 30, 2010?

  13. After the FAFSA • The college: • Receives the FAFSA results (EFC) • May ask for additional information • Verification: minimum 30% • Uses the EFC to determine eligibility • Sends an award letter to notify the student

  14. After the FAFSA • The student & family: • Receive Expected Family Contribution (EFC) • Receive SAR (student aid report) • Review all answers and resubmit if necessary • If provided email will receive SAR via email • Receive an award letter from schools • Accept/Decline awards • If you will need a student loan • Entrance exam and sign MPN

  15. Major Federal Programs • http://studentaid.ed.gov • Pell Grant • Based on EFC…goes to neediest families • Maximum of $5,350 a year • FSEOG • Federal Supplemental Educational Opportunity Grant • Additional grant aid to lower EFC’s • $100 minimum $4,000 maximum • Teach Grant • Career in teaching or plan to complete such course work • Teach in a high-need field (mathematics, special education)

  16. Major Federal Programs • Academic Competitiveness Grant (ACG) • Awarded to eligible 1st and 2nd year college students who have completed a “rigorous” secondary school program • Self Certified • Max Award is $750 for 1st year, $1,300 for 2nd year • Students who meet minimum requirements will be sent self-certification instructions by college financial aid office • National Science and Mathematics Access to Retain Talent Grant (SMART) • Awarded to 3rd and 4th year degree seeking full-time students • Must major in qualified Sciences, Engineering, Mathematics or Technology • Eligible students will be identified automatically • $4,000 maximum

  17. Major Federal Programs • Federal Work-Study • Employment opportunity • Usually on campus • Paid periodically through payroll • Wages not considered income for FAFSA purposes

  18. Major Federal Programs • Federal Perkins loans • Fixed interest (5%) loan goes to neediest families • Nine-month grace period before repayment • Up to 10 year repayment • Deferment and cancellation provisions

  19. Major Federal Programs • Federal Stafford loan • Subsidized-based on need • Unsubsidized-need not considered • Yearly undergraduate loan limits • $5,500 1st year - $3,500 sub & $2,000 unsub • $6,500 2nd year - $4,500 sub & $2,000 unsub • $7,500 Remaining years - $5,500 sub & $2,000 unsub

  20. Major Federal Programs • Federal Stafford loans (continued) • **Fixed Rate 4.5% as of July 1st 2010 • Six-month grace period • 10 to 25 year repayment period • Deferment and cancellation provisions • **Current legislation may change

  21. Major Federal Programs • PLUS loans for Parents • **Fixed Rate 8.5% - July 1, 2010 • Loan fees deducted from proceeds • Up to 3% depending on lender • Credit based loan • Repayment usually begins 60 days after full disbursement but some lenders allow no payments until student graduates **Current legislation may change

  22. State Programs • Grant, scholarship, loan and work programs • Colorado Opportunity Fund www.collegeincolorado.org • High school counselors and college financial aid offices are the best resources • Watch deadlines!

  23. College and Universities • Schools may offer grant, scholarship, loan and/or work programs • Be informed: • Financial aid office • Admissions office • Publications • Website • Watch deadlines!

  24. Private Sources • Scholarship search - start NOW! • Talk with Financial Aid Office • Counselors • Beware of scams • Watch deadlines!

  25. Common Questions • When can I file the FAFSA? • January 1st, no earlier; Will need to • re-file each year; same PIN • What if I am not going to file my taxes till later? • You can use estimated numbers; indicate on FAFSA “will file”

  26. Common Questions • I know we don’t qualify so why should we apply? Everyone qualifies for something! • What if our income changes? See the financial aid office at the school. • What if I have special circumstances?See the financial aid office at the school to file a professional judgment / appeal

  27. Other Financing Options • Private (alternative) loans • Variable interest rates (usually higher than PLUS) • Possible tax deductions • Credit cards • Students BEWARE of on-campus credit card offers • Home equity loans • 6 – 9% interest rate • Possible tax deductions (itemize)

  28. Checklist • Scholarship search • Admissions applications • Complete the FAFSA • Supply additional info the school requests • Receive award letter • Respond and select lender if loan is needed • Sign promissory notes if required • Funds are disbursed by school

  29. Is It Worth It?

  30. Need assistance? • College Financial Aid Office • High School Guidance Counselors • Don’t pay for assistance unless you absolutely want to!

  31. good luck! • ldiehl@gcu.edu • 720.272.3913

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