Goals of Financial Aid Primary goal is to assist students in paying for
college & is achieved by:
Evaluating family’s ability to pay
educational costs
Distributing limited resources in an
equitable manner
Providing balance of gift aid and Self-
help aid
Financial Aid Financial Aid = Assistance for students
to fund their education in the form of:
Grants
Scholarships
Loans
Employment
Merit-Based Aid vs. Need-Based Aid Merit-Based Aid = aid given to students strictly on the
basis of merit. May be based on: Academic record Special characteristics Skills or talents Involvement
- Does not have to be repaid; usually renewable from year to year.
Need-Based Aid = aid awarded to students on the basis of financial need. Re-evaluated each year as financial situations may change.
Financial Need Cost of Attendance
-Expected Family Contribution
Financial Need Cost of Attendance typically includes
tuition, fees, room & board, books & supplies, personal expenses and a transportation allowance
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 & consistent manner, recognizing that special circumstances may affect family’s ability to pay
What Is The EFC? Basis of financial aid package
EFC=determined by a formula that
calculates need
EFC & Financial Need are guidelines used
by schools to determine aid package
EFC not necessarily = to out-of-pocket
cost of family
Federal Methodology Federal Methodology (FM) is the
formula created by Congress to determine the EFC
Used to determine eligibility for Federal and State aid. Some schools use FM to determine eligibility for their own aid
FM is calculated based on information on the FAFSA
Institutional Methodology
Some schools may require CSS Profile Form Primarily private schools Collects supplemental data (i.e.-home
equity, financial data of non-custodial parent, value of retirement plans, etc.)
Calculates IM (Institutional Methodology) Basis for awarding institutional need-
based aid only Register to complete form at
www.collegeboard.com Fee $5 plus $18 per school
How Is The FM EFC Calculated?
Primary Factors Looked At:
Taxable Income: AGI (wages earned+interest
dividends+other taxable income)
Untaxed income & benefits
Number in family
Number of dependent children in college
Assets Change this year: business value not included if business
has less than 100 employees
Learn more about the EFC
•Utilize a Financial Aid Calculator to familiarize yourself with more details and to get an early estimate of your EFC
•Go to www.collegeboard.com and click on tab “Pay for college” and select Fin. Aid Calculator from the options on the left, then select EFC and insert your personal information
What Is The FAFSA? FAFSA = Free Application For Federal
Student Aid Application for federal and state aid (may be
application for college aid as well, depending upon the school)
Parent/Student Sections color-codedFile one FAFSA per year per student
(not one per college)List up to six colleges--Title IV Code or
school name; schools receive info. electronically
How/When to File the FAFSA? Available in most guidance offices or on
the Internet; college/university may mail to student as well; PHEAA mails to PA SAT takers
Ways To Complete the FAFSA: On-line at www.fafsa.ed.gov Mail paper FAFSA to Federal Student Aid
Programs Complete as soon as possible after January
1, or file electronically at www.fafsa.ed.gov beginning January 2 prior to the fall for which student seeks aid.
FAFSA On The Web If filing over the Internet, 2 choices:
Parent and student mail signature page in or
Parent and student apply for PIN # at www.pin.ed.gov
PIN # serves as e-signaturePIN # will be mailed or e-mailed ahead
of time to student
Use PIN # to submit info. and make corrections over Internet at www.pin.ed.gov
Filing The FAFSA Based on prior calendar year tax
information May use estimated income and taxes Don’t wait to be accepted to college to
complete PA residents must file by May 1 for
state grant consideration for following fall term; state will follow up with student
MAKE COPIES OF EVERY FORM!
Whose Information is on the FAFSA? Dependent: parental & student financial data
required Independent: student & spouse financial data
required Student must meet one of following criteria to
be considered independent: 24 years of age Veteran of the U.S. Armed Forces Enrolled in a graduate or professional program Married Orphan or ward of the court until age 18 Have legal dependents that student provides at
least 50% support for
Whose Information is on the FAFSA? When filing FAFSA, financial information of parent
that student resides with for more than half of the year (if equal time, information of the parent that provides the most financial support) should be provided
If re-married, the financial data of new spouse must be included
Help! Sources of Aid Federal
State
The College/University
Outside Organizations Civic organizations (ex.-local Rotary Club),
parent’s employer, high school
Federal Must:
Be a U.S. citizen or eligible non-citizen Have h.s. diploma or equivalent Be matriculating in a degree/certificate
program at accredited Title IV school Be registered with Selective Service if a
male between ages of 18 and 25 Free of drug possession or sale conviction
Pell Grant (need-based): $4, 310 max/year for 2007-2008 year
Federal Campus-Based Aid SEOG Grant-exceptional need -
$100-4,000/year (typically have to receive Pell)
Perkins Loan-exceptional need -
$100-4,000/year; 5% interest rate
Federal Work Study
Colleges have set allocations -
(student may receive award from one school &
not another!)
Two new programs
Academic Competitiveness Grant$750 for first year students$1,300 for second year students
SMART Grant$4,000 for third and fourth year students in selected science, math and critical language majors
Must be U.S. Citizens and eligible for Pell Grants
Federal Stafford Loan In student’s name/no credit check
Available to all students, regardless of need
Repayment begins 6 months following graduation or
withdrawal
Competitive interest rate
6.8% cap rate
Amount varies by class
$3,500 for freshman
$4,500 for second year students
$5,500 for third year and beyond (undergrads)
FederalPlus Loan (Parent Loan for Undergraduate Students) Loan in parent’s name Interest rate set at 8.5% Repayment begins 60 days after 2nd
disbursement Credit check involved Borrow up to cost of attendance minus other
financial aid student is receiving Add’l. unsub available to students whose
parent(s) are denied on PLUS Loan due to poor credit
State Pennsylvania State Grant (for PA Residents):
$4,500 max/year for students attending a PA school Eligibility based on need and family’s unique
circumstances PHEAA has their own adjusted family income cutoff Max PHEAA Grant that can transfer out-of-state,
$600, to: CT, DE, MA, ME, OH, RI, VT, DC, WV $400 maximum transfers to other states, except NJ,
MD and NY--$0 transfers there (some exceptions) Student must file FAFSA by May 1 for upcoming fall
term PHEAA sends student status notice beginning mid-
May; student must complete and return to PHEAA
College/University Factors that may influence institutional
aid, particularly merit-based aid:Academics Athletic Ability*SAT’s Geographic Diversity
AP Courses Legacy (child of Activities alumni)
Academic Track Talent
H.S. Attended Class Rank
*Athletic awards only offered by NCAA Division I and Division II schools only.
Outside Sources Private sources of scholarship funds include:
Service/Fraternal Organizations Employers/Business Churches/Religious Groups
Sources of Information Internet: www.pasfaa.org
www.finaid.orgwww.nasfaa.orgwww.collegeboard.comwww.fastweb.monster.comwww.srnexpress.com
Guidance Office Computer Programs Local library resources
Comparing Aid Offers Don’t assume that more expensive schools will
necessarily cost you more!
Look at same “bottom line” for each school.
Compare “apples” to “apples.” What is amount of loan in package vs. amount of
grant?
What is amount of work study?
Are grants/scholarships automatically renewable? If
so, what are criteria?
Comparing Aid Offers School A School B School CCost $5,500 $15,800 $35,000EFC $3,000 $3,000 $3,000Need $2,500 $12,800 $32,000 Pkg. #1: $2,500 Grants $6,000 Grants $26,000 Grants
$6,800 Loans $4,000 Loans $2,000 Work
Pkg. #2 $1,500 Grants $5,500 Grants $17,000 Grants $1,000 Loans $5,000 Loans $ 8,000 Loans $1,000 Work $ 1,500 Work
Pkg. #3 $500 Grants $4,000 Grants $11,000 Grants $1,500 Loans $4,000 Loans $9,000 Loans $500 Work $1,500 Work
Comparing Aid Offers Will package change if outside
scholarships are received?
What factors will cause change? (i.e.-
number in college, income increase)
Is there room for movement? Check
with the F.A. Office—there might be
but it’s not “Let’s Make A Deal!”