What is this Financial Aid Thing Anyway
Capital High School
October 24, 2012
Tracy Dahl and Sabrina Knoll
Centralia College Financial Aid Office
© NASFAA 2010
Slide 1
Topics We Will Discuss
• What is financial aid
• Understanding college costs
• The expected family contribution, or EFC
• What is financial need
• Types of financial aid
• Sources of financial aid
© NASFAA 2010
Slide 2
Topics We Will Discuss
• How to apply for financial aid
• The federal financial aid programs
• Estimating eligibility for federal financial aid
using FAFSA4caster
• Researching financial aid options
• What you should be doing now
© NASFAA 2010
Slide 3
Know How to Go
• http://www.youtube.com/user/KnowHow2Go
© NASFAA 2010
Slide 4
What is Financial Aid?
Any money from outside of the family that
pays postsecondary (college) expenses.
© NASFAA 2010
Slide 5
Understanding College Costs
• College is expensive, but worth the cost
– A sound investment in your child’s future
• More than just tuition
– Also includes room and board, books,
transportation, personal expenses, etc.
© NASFAA 2010
Slide 6
Understanding College Costs
• Vary by type of college
– Community colleges are less expensive than
four-year schools
– Private colleges are more expensive than public
colleges
– http://www.wsac.wa.gov/PayingForCollege/Cost
Factors
© NASFAA 2010
Slide 7
Expected Family Contribution (EFC)
• Calculated using a federal form (FAFSA)
and formula
• Two components
– Parent contribution
– Student contribution
© NASFAA 2010
Slide 8
Expected Family Contribution (EFC)
• Amount family can reasonably be expected
to contribute, but not what family will pay to
the college
• EFC the same regardless of college the
student attends
© NASFAA 2010
Slide 9
What is Financial Need
• Financial need is the difference between the cost of
attendance (COA) and expected family contribution
(EFC).
• COA is tuition, fees, room and board, transportation, etc.
• EFC is determined from what you report on the FAFSA
(Free Application for Federal Student Aid)
• COA – EFC = Financial Need
© NASFAA 2010
Slide 10
What is Financial Need
• For example, if COA is 10,000, and EFC is
2,000, then a student’s need is 8,000
• Amount of financial need determines the
amount of aid a student will receive
© NASFAA 2010
Slide 11
Sources of Financial Aid
• Federal government
• States
• Colleges
• Private sources
© NASFAA 2010
Slide 12
Federal Government
• Largest source of financial aid
• Awarded mainly on the basis of financial
need
• Apply every year using standard form called
Free Application for Federal Student Aid –
(FAFSA)
© NASFAA 2010
Slide 13
States
• Offer both merit-based and need-based aid
• Usually have residency requirements
• May have service requirements
© NASFAA 2010
Slide 14
Colleges
• Varies widely from college to college
• Offer both merit-based and need-based aid
• May be offered as part of the admissions
process
© NASFAA 2010
Slide 15
Private Sources
• Churches, civic organizations, employers
• Varying award amounts and application
procedures
• Small awards add up
© NASFAA 2010
Slide 16
Types of Financial Aid
• Grants
• Loans
• Employment
• Scholarship
© NASFAA 2010
Slide 17
Grants
• Awarded on the basis of financial need
• Do not have to be paid back
© NASFAA 2010
Slide 18
Federal Grant Programs
• Federal Pell Grant
• Teacher Education Assistance for College and
Higher Education (TEACH) Grant
• Federal Supplemental Educational Opportunity
Grant (FSEOG)
• http://www.studentaid.ed.gov/
© NASFAA 2010
Slide 19
Maximum amounts for federal grants
• Federal Pell Grant:
$5,550
• Federal TEACH Grant: $4,000
• FSEOG:
© NASFAA 2010
$4,000
Slide 20
Washington State Need Programs
• Washington State Need Grant
• College Bound Scholarship
• Passport Program
• Our state aid: www.wsac.wa.gov
© NASFAA 2010
Slide 21
Maximum amounts for state grants
• Washington State Need Grant
– UW/WSU
– Other 4 year public
– Private 4 year
– Community College
© NASFAA 2010
$10,868
$ 7,580
$ 8,517
$ 3,696
Slide 22
Loans
• Must be paid back, usually after the student
finishes school
• Many different types
• Student loans are a reasonable form of aid
– A good investment in the student’s future
© NASFAA 2010
Slide 23
Federal Loan Programs
• Federal Perkins Loan
• Federal Direct Loans
– Borrowed by students
• PLUS Loans
– Borrowed by parents and graduate students
© NASFAA 2010
Slide 24
Maximum loan amounts and interest
rates for first year student
• Federal Direct Loan: $5500 (no more
than $3500 subsidized)
• Interest rate fixed 3.4% subsidized, 6.8%
unsubsidized
• Federal Perkins Loan: $4000
• Interest rate fixed 5%
• Interest rates set by Congress
© NASFAA 2010
Slide 25
Federal Parent Loan
• COA minus other aid received
• Interest rate fixed 7.9%
© NASFAA 2010
Slide 26
Employment
• Earnings used to cover college expenses
• Advantages – Gain work experience and
earn money
• Income is reported on tax return but is
excluded when calculating financial aid
eligibility
© NASFAA 2010
,
Slide 27
Employment Programs
Federal Work-Study (FWS)
State Work-Study (SWS)
© NASFAA 2010
Slide 28
Scholarships
• Awarded on the basis of merit or unique
characteristics
• Do not have to be paid back
© NASFAA 2010
Slide 29
How to Apply for Financial Aid
• Complete a standard federal form every
year
• Free Application for Federal Student Aid, or
FAFSA at www.fafsa.gov
– Collects demographic and financial information
– Data used to calculate the EFC
© NASFAA 2010
Slide 30
Be Aware of Deadlines
• Check with the colleges/universities to determine
their priority deadline so that you are sure to have
your FAFSA and any other additional
forms/requirements submitted by that deadline.
• Financial aid is usually awarded on a first-come,
first-served basis. Don’t lose out on funding by
missing the deadline.
• The FAFSA form is available January 1, 2013 –
submit it as soon after that date as possible.
© NASFAA 2010
Slide 31
Estimating Eligibility Using FAFSA4caster
On-line tool developed by U.S. Department of
Education to help families prepare financially
for college
• Asks for data you will need to provide on
the FAFSA
• Estimates eligibility for the Federal Pell
Grant
• Available at www.FAFSA4caster.ed.gov
© NASFAA 2010
Slide 32
Researching Financial Aid
• Begin early
• Find scholarships that match your student’s
academic interests, hobbies, and unique
characteristics (www.washboard.org)
• Don’t pay for scholarship searches or to fill
out the FAFSA
• Report fraud
© NASFAA 2010
Slide 33
What You Should Be Doing Now
• Begin researching financial aid options
• Start or continue saving
• Take college prep classes
• Participate in extracurricular activities
• Develop strong study skills
© NASFAA 2010
Slide 34
Conclusion
• It is never too early to start the college
planning process
• The more information you have, the easier
the process will be for you and your student
© NASFAA 2010
Slide 35
Questions?
Centralia College
Financial Aid Office
360-736-9391, ext. 234 or
financialaid@centralia.edu
© NASFAA 2010
Slide 36
© NASFAA 2010
Slide 37