1

CollegeFinancing

1(Seminarslidesareavailableforprintingonthesidebarofmefa.org/events)

2AboutMEFANot-for-profit state authority created in 1982 helping families plan, save, and

pay for college and reach financial goals

KeepingyouontrackwithFREEcollegeplanning:• Visitmefa.org:Information,tools,&resources• Callus:(800)449-MEFA(6332)withanyquestions• Emailus:collegeplanning@mefa.org• Followus:Facebook,Twitter,&LinkedIn• Getouremails:Signuponmefa.org• Attendaseminar:Detailsatmefa.org/events• Attendawebinar:Registeratmefa.org/events

3SeminarTopics• FindOutAboutTypes&

SourcesofFinancialAid

• ReviewtheApplicationProcess

• UnderstandHowFinancialAidDecisionsAreMade

• LearnAboutPayingforCollege

• DiscoverFreeResources

4

TypesandSourcesofFinancialAid

4

5WhatisFinancialAid?

• 3maintypes• Grantsandscholarships(giftaid)• Federalwork-study• Federalstudentloans

Financialaidismoneytohelpstudentspayforcollege

6FinancialAidBreakdown• Undergraduate Student Aid 2017-18 ($184.1 Billion)

FederalStudent Loans30% Federal

Work-Study 1%

Federal Grants 15%

Institutional Grants &

Scholarships26%

Private Grants

7%

Federal Tax

Credits8% State

Grants6%

Source:TheCollege Board, Trends inStudentAid2018

Veterans Benefits

6%

7SourcesofFinancialAidMassachusetts

• Grants,scholarships,tuitionwaivers,loans

• mass.edu/osfa

College/University(institutionalaid)

• Grants,scholarships,loans

OtherAgencies

• Scholarships:Searchthroughmefapathway.org,fastweb.com,andyourschoolcounselor

Federal

• Grants,work-study,loans,taxincentives

• StudentAid.gov

8FederalDirectStudentLoans

• Studentisthesoleborrower• Nocreditcheck• SubsidizedandUnsubsidized• 4.529%fixedinterestratefor2019-20• Repayment:

― Nopaymentsduewhileenrolled― Multipleoptions(manytiedtoincome)― Approximately$300/monthfor10

yearsfor$27,000debt― Deferment,forbearance,and

forgivenessopportunities

AnnualLoanLimitsFreshmanYear $5,500SophomoreYear $6,500

JuniorYear $7,500SeniorYear $7,500

9Merit-BasedAid

• Awardedinrecognitionofstudentachievements(academic,artistic,athletic,etc.)• Mighthaverenewablerequirementsornotberenewable• Notofferedateverycollege;checkeachcollege’swebsitefordetails• Separateapplicationsometimesrequired(checkdeadlines!)• ApplicationdeadlinemaybeasearlyasNovember

10Need-BasedAid

• Basedonfamily’sfinancialeligibility(“need”)• Eligibilitydeterminedbyastandardizedformula• Includesgrants,loans,andwork-study• Mostfinancialaidisneed-based• Mustbemakingsatisfactoryacademicprogress

11

TheApplicationProcess

11

12FinancialAidTimeline• Checkdeadlinesandrequiredapplicationsoneachcollege’swebsitenow• Earlyaction/decisiondeadlinesareofteninOctoberorNovember• StandarddeadlinesaretypicallyinFebruaryorMarch• DON’TSUBMITAPPLICATIONSLATE• UseMEFA’sCollegeApplicationManagertostayorganized

• mefa.org/college-application-manager

13FAFSA®

• FreeApplicationforFederalStudentAid(FAFSA)• Requiredbyallcolleges• BecomesavailableOctober1st:fafsa.gov• Easy completiononmyStudentAidmobileapp• LoginwithanFSAID:fsaid.ed.gov

• Bothstudentandparentneedone!• IRSDataRetrievalTool:Pullinfederaltaxdata• FAFSAwebinarrecordingonmefa.org/events• MUSTBECOMPLETEDEVERYYEAR

14What’sReportedontheFAFSA?GENERALINFORMATION

• Studentcitizenshipstatus― Non-citizenparents:

o UsezerosforSSNo Printsignaturepagetosign(cannotgetFSAID)

• Collegeswherestudentisapplying(eachonewillreceiveyourFAFSA)

• Parents― Married,includingsame-sexparents― Allparentswholivetogether,marriedornot― Divorced/Separated:custodialparent&currentspouse― LegalguardiansareNOTaparent

• #inhousehold,#ofchildrenincollege

15What’sReportedontheFAFSA?

FINANCIALINFORMATION

• Parentandstudentincome(2018incomeforthe2020-21FAFSA)― Bothtaxedanduntaxed

• Parentandstudentassets― Include:savings,checking,investments,otherproperty― Include:all529accountsasaparentasset― Donotinclude:primaryhome,valueofretirement,life

insurance,valueofsmallfamilybusiness

• Debtisnotreportedexceptdebtonreportedassets

16OtherFinancialAidApplications

CSSProfileTM• cssprofile.org• Requiredbysomecollegesanduniversities• $25for1stschool,$16foreachadditional• BecomesavailableOctober1st• Noncustodialparentwillneed tosubmita

separateProfile• Profilewebinar recordingonmefa.org/events

CollegeFinancialAidApplication• Requiredbysomecollegesanduniversities

17AfterYouApply

1. Colleges&statereceivedataelectronically2. StudentwillreceiveStudentAidReport(SAR)bymailoremail3. ContacttheFinancialAidOfficewithanyspecialcircumstances4. CollegesmayrequestFederalVerificationdocuments.Thefinancialaid

applicationisincompleteuntilyousubmitthesedocuments.5. Collegesreviewapplicationsanddeterminethefinancialaidaward

18Verification

• Collegesverifydataonfinancialaidapplications• StudentsselectedbyDepartmentofEducationorcollege• Mustcomplywithallrequeststoreceivefinancialaid• Familiesmustsubmitadditionaldocumentation:

―TaxReturn―VerificationWorksheet―AssetAccountStatements

• Reviewallcorrespondencefromcolleges• Logintocollegewebportalforcommunications

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HowFinancialAidDecisionsAreMade

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20CostofAttendance(COA)

COA=TotalExpensesforOneYearofCollege

Tuition&Fees ++ + + Personal

ExpensesTransportationBooks&Supplies

Room&Board

=BilledorDirectExpenses =Non-BilledorIndirectExpenses

21ExpectedFamilyContribution(EFC)

• Amountfamilyhasabilitytoabsorbfor1yearofcollegecosts

• Samefederalformulausedforeveryfamily• Somecollegesalsouseaninstitutional

formula• Familyhastheprimaryresponsibilityfor

paying• Notnecessarilywhatthefamilywillpay• Lowerediffamilyhasmorethan1childin

college• EFCCalculatoronmefa.org

22NetPriceCalculators

• Onlinetoolfoundoneachinstitution’swebsite

• Asksquestionsaboutfamilyfinances&studentacademics

• Providespersonal,estimatednetcollegeprice

• Displaysfederal&institutionalaid

• Merit-basedaidmayalsobeincluded

23FinancialAidFormula

CostofAttendance(COA)- ExpectedFamilyContribution(EFC)

= FinancialAidEligibility

CollegesfillinFinancialAidEligibilitywithfinancialaidfromallsources

24AssetImpactonEFC• Anexample:4inthefamily,1childincollege

FamilyA FamilyB FamilyC

CombinedParentIncome $75,000 $75,000 $75,000

CombinedParentAssets $0 $75,000 $150,000

EFC $7,223 $10,422 $14,652

Difference $3,199 $7,429

Basedon2020-21FederalMethodology

25IncomeImpactonEFC• Anexample:4inthefamily,1childincollege

FamilyA FamilyB FamilyC

CombinedParentIncome $75,000 $100,000 $150,000

CombinedParentAssets $50,000 $50,000 $50,000

EFC $9,025 $17,531 $33,053

Difference $8,506 $24,028

Basedon2020-21FederalMethodology

26HowtheFormulaWorks

$0

$10,000

$20,000

$30,000

$40,000

$50,000

$60,000

$70,000

$80,000

College A College B College C College D

EligibilityEFC = $5,000

CostofAttendance

27FinancialAidAwarding

UnmetneedandEFCistheFAMILY’s responsibility

CollegeCOA=$45,000

Unmet Need $5,500

Work-Study $2,000

Student Loans $5,500

Grant $17,500Scholarship $9,500

EFC $5,000

28AwardLetters:TotalsCanVary

COA:$45,000EFC:$5,000TotalEligibility:$40,000

CollegeA CollegeB CollegeC

Grants/Scholarships $32,500 $25,500 $17,500

StudentLoans $5,500 $5,500 $5,500

Work-Study $2,000 $2,000 $2,000

Total $40,000 $33,000 $25,000

UnmetNeed $0 $7,000 $15,000

29AwardLetters:TypesCanVary

CollegeA CollegeB CollegeC

Grants/Scholarships $27,500 $17,500 $0

StudentLoans $5,500 $5,500 $5,500

ParentLoans $0 $10,000 $29,500

Work-Study $2,000 $2,000 $0

Total $35,000 $35,000 $35,000

UnmetNeed $5,000 $5,000 $5,000

COA:$45,000EFC:$5,000TotalEligibility:$40,000

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PayingforCollege

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31FillingtheEFCandUnmetNeed:AnExample

BalanceDue $20,000PastIncome(Savings)

StudentSavings -$1,000

ParentSavings -$4,000

PresentIncome(CurrentWages)

ParentContributiontoPaymentPlan -$5,000

FutureIncome(BorrowingCollegeLoans)

EducationLoan -$10,000

$0

32AdditionalFinancialConsiderations

• Wouldstartingatcommunitycollegesavesignificant$?• Considerthenumberofchildrenyouwillsendtocollege• Thinkintermsoftotalenrollment(4+years)andtotaldebt• Calculatethepost-graduationmonthlyloanpayment• Researchthepotentialstartingsalaryfortheintendedcareer• Isthestudentconsideringgraduateschool?• Knowyourcreditscoreifyouplantoborrowaprivateloan• Compareeachschool’snetpriceafterfinancialaidoffersare

received

33PayingforCollegeinMA:YouHaveOptionsMassTransfer

–Makestransferfromcommunitycollegetoa4-yearpublicMAcollegemoreaffordable

–Benefitsincludeguaranteedcredittransfer,tuitioncredit,&freezeontuition

–mass.edu/masstransfer

TuitionBreak– Reductiononout-of-statetuitioncostsatNewEnglandschoolsforcertainprograms

–Nebhe.org/programs-overview/rsp-tuitionbreak/overview

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FreeResources

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35FinancialAidOffice

LearnaboutYourFinancialAid

• Financialaidrenewabilitycriteria(financial,academic)• Treatmentofprivatescholarships

AskAboutSpecialConsiderations

• Changesinfamilycircumstances• CanIappealmyaward?How?

FindOutAdditionalDetails

• OpenHouseandOrientationprograms• Additionalfinancialresources

HowtoContacttheFinancialAidOffice

• Financialaidofficewebsite• In-personmeeting• Phonecall• Email

36NationalandCommunityResources

• FAFSADay― FreeassistancecompletingtheFAFSA― OctoberthroughFebruary― FAFSADay.org

• EducationalOpportunityCenters― Freefinancialaidhelp― MassEdCO.org

37AftertheCollegeAcceptanceSeminars

• Providesassistanceandclarityon:― Financialaidawards― Thecollegebill― Paymentplans― Collegeloans― WhattoasktheFinancialAidOffice

• LocationsacrossMAinMarchandApril(regional:notofferedateveryhighschool)

• RegisterforMEFAemailstoreceivelocations

• Webinarsalsooffered

38WhatYouCanDoNow• Completetheseminarevaluation

• SignupforMEFAemails

• GetanFSAIDforthestudentandparent

• Researchdeadlinesandrequiredapplications

• Signupforwebinarsatmefa.org/events

• ReferenceMEFA’sCollegeAdmissionsandFinancialAidTimelineonmefa.org

39ConnectwithMEFAonSocialMedia

facebook.com/mefaMA

@MEFAtweets

linkedin.com/company/mefa

youtube.com/MEFAcounselor

40ThankYou

Questions?Presenter:ShannonVasconcelos

(800)449-MEFA(6332)collegeplanning@mefa.org

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