Making College Affordable: Applying For Financial Aid Moderator Richard Steele (WBEZ) Panelists...

Making College Affordable: Applying For Financial Aid

Moderator

Richard Steele (WBEZ)

Panelists

Gloria Purifoy (Chicago Public Schools)

Tim Opgenorth (UIC)

1. Myth: My child is 18 and of legal age. He/she can and should file for financial aid on his/her own.

Reality: Students are usually considered a dependent until the age of 24.

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10 Myths of Financial Aid

2. Myth: I cannot apply for financial aid if I have a valid social security number but one or both my parents do not.

Reality: Only students need a valid SSN.




3. Myth: Parents who are not U.S. Citizens or legal residents will be reported if they provide their personal and financial information.

Reality: Parent data is never reported.




4. Myth: If I have no contact with my parents and cannot provide their information. I will be unable to apply for financial aid.

Reality: You can still apply without parent information.




5. Myth: If my parent(s) refuse to provide their information, I can still apply for financial aid without parental information.

Reality: The application will be considered "rejected," and you might not receive any federal student aid except for a loan.




6. Myth: It is unsafe to provide private information to people I do not know, especially on the Internet.

Reality: FAFSA on the Web is highly secured.




7. Myth: I (we) make too much to qualify for financial aid.

Reality: There is no income cut-off to qualify for financial aid.




8. Myth: My bad credit or default loans will hurt my child’s chances for financial aid.

Reality: A parent’s debt or default loans are not considered on FAFSA and is not required.




9. Myth: If I am eligible for the full amount of financial aid, I should be able to meet all educational costs.

Reality: Financial aid rarely covers the total cost of education.




10. Myth: I cannot file a FAFSA for my child because I do not claim him/her on my tax return.

Reality: Tax dependency is independent of FAFSA eligibility.




A snapshot assessment of …• Cost of education for the school of

choice• Estimate of the expected family

contribution (EFC) • Financial need and aid eligibility• Estimate net price or “gap” in aid• Need some student and parent

financial information



Conduct A Financial Needs Analysis

Families need…

• To become familiar with college costs, available aid, and potential family costs.

• An early EFC estimate to prepare a financial plan to meet the cost of education.

• To know their federal and state funding eligibility.

• To be proactive in their college selection based on both an academic and financial fit.



Why Get An Early Need Assessment?

• Financial Aid Needs Estimator: http://webapps01.act.org/fane/docs/

• EFC Calculator: www.whatsnextillinois.org

• UIC website: http://www.uic.edu/depts/financialaid/

• FAFSA4Caster: https://fafsa.ed.gov/FAFSA/app/f4cForm?execution=e1s1



College Cost and Aid Calculators

http://webapps01.act.org/fane/docs/

http://www.whatsnextillinois.org/

http://www.uic.edu/depts/financialaid/

http://www.uic.edu/depts/financialaid/

https://fafsa.ed.gov/FAFSA/app/f4cForm?execution=e1s1

https://fafsa.ed.gov/FAFSA/app/f4cForm?execution=e1s1

Investigate options. Ask each school:• The percent of need they meet with financial

aid• Their ratio of grants and scholarships awarded

versus work study and loans• Do they offer an early financial aid award

estimate



Be An Educated Consumer

Choose optimal postsecondary fit based on:• Academic admissibility match• Career accessibility and personal fit• Financial affordability




Be sure your choice is a wise investment:• Can you meet your gap in aid annually?• Choose a major that makes sense for your

potential debt to income outlook.




• Scholarships

• Grants

• Loans

• Employment



Types of Financial Aid

• Money that does not need to be repaid

• Scholarships are awarded on the basis of merit, talent, skill, or a unique characteristic

• Grants are usually awarded on the basis of financial need



Scholarships and Grants

• Money students and parents borrow to help pay for educational expenses

• Repayment usually begins after education is finished

• Look at loans as an investment in the future



Loans

• Allows student to earn money to help pay educational costs

• A paycheck; or

• Non-monetary compensation, such as room and board



Employment

• A standard form that collects demographic and financial information about the student and family

• Information is used to calculate the Expected Family Contribution (EFC)

• Colleges use EFC to award financial aid



Free Application for Federal Student Aid (FAFSA)

• The FAFSA was available as of January 1, 2011 for the 2011-12 academic year

• Most colleges set a FAFSA priority filing deadline, with March 1st being the most common



Completing the FAFSA

• Available in English or Spanish

• FAFSA Website: www.fafsa.gov



FAFSA on The Web

http://www.fafsa.gov/

• Need PIN to sign the form electronically

• PIN Website: www.pin.ed.gov



Federal Student Aid PIN

http://www.pin.ed.gov/

• Social Security Numbers• Divorced/remarried parental information• Income earned by parents/step-parents• Untaxed income• U.S. income tax paid• Household size• Number of household members in college• Real estate and investment net worth• Lack of proper signatures



Frequent FAFSA Errors

Cost of Attendance (COA)- Estimated Family Contribution (EFC)

= Financial Need

Examples:

COA EFC Need

20,000 5,000 $15,000

15,000 5,000 $10,000



Financial Need

• Includes direct and indirect costs

• Is the total ESTIMATE of students expenses at the particular institution

• Varies widely from college to college



Cost of Attendance

• Direct Costs– Tuition $9,134– Fees $3,730

• Indirect Costs– Books and Supplies $1,200– Transportation $1,452– Misc./Personal $2,176– Room and Board $10,882



Cost of Attendance Example - UIC

FALL SPRING TOTAL

Offered Awards:Presidents Award $1,500 $1,500 $3,000Private Scholarship $1,000 $1,000 $2,000 Federal Pell Grant $1,300 $1,300 $2,600State of IL MAP Grant (Est). $2,484 $2,484 $4,968 UIC Access to Excellence Grant $2,500 $2,500 $5,000Federal Direct Loan–Subsidized $1,750 $1,750 $3,500

Federal Direct Loan–Unsubsidized $1,000 $1,000 $2,000Federal Parent Loan $1,000 $1,000 $2,000 Federal Work Study $1,500 $1,500 $3,000

Total Aid Awarded $14,034 $14,034 $28,068

Note: Student can choose to accept/decline any aid type offered.



Financial Aid Award Example - UIC

• FinAid - An easy-to-use guide to financial aid programs and terms

http://www.finaid.org

• Illinois Student Assistance Commission – The State of Illinois site for financial aid information

http://www.collegezone.com

• Student Aid on the Web – The U.S. Department of Education’s site for financial aid information http://studentaid.ed.gov/PORTALSWebApp/students/english/index.jsp



Helpful Websites

http://www.finaid.org/

http://www.collegezone.com/

http://studentaid.ed.gov/PORTALSWebApp/students/english/index.jsp

http://studentaid.ed.gov/PORTALSWebApp/students/english/index.jsp



Questions

Making College Affordable: Applying For Financial Aid Moderator Richard Steele (WBEZ) Panelists...

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