Understanding Financial Aid:
YOUR High School Information
Night
Financing Your
Education
• Goal of financial aid
• How to apply
• Determining eligibility
• Types of aid available
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Paying for College is…
…a Shared Responsibility
• Students and Parents
• State and Federal Governments
• Private Sources
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Financial Aid Regulations
•Are determined by federal
and state statutes and legislators
•Establish your eligibility for
most types of aid
•Apply to all schools
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You may be eligible for
aid, but…
YOU MUST
APPLY TO FIND
OUT!
www.FAFSA.gov
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Completing the FAFSA
• Apply for a pin, www.pin.ed.gov (both student and parent)
• The earliest you may file the FAFSA is January 1 each year
• Check with the colleges where you plan to apply for deadlines
and institutional requirements.
• UW-Milwaukee priority date March 1
• IRS Data Retrieval Tool
• Who is considered a parent?
• You must re-apply for aid every year.
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FAFSA: What do I need?
• Your social security number
• Driver’s license (if applicable)
• Your W-2 Forms from previous year
• Student and Parent Federal Income Taxes
– Form 1040, 1040A, or 1040EZ
– Need PIN, correct filing address, and filing status for IRS Data Retrieval
• Untaxed income records (Non-ed veteran benefits, child support)
• Current bank statements
• Business and investment mortgage information, business and farm
records, stock, bond, and other investment records
• Documentation that you are a permanent resident or other eligible noncitizen
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Frequent FAFSA Errors
• Missing Signatures/PIN
• Wrong Social Security Number
• Divorced/remarried parent information
• Untaxed income
• U.S. income taxes paid
• Household size
• Number in postsecondary education
• Not using birth name
• NOT APPLYING AT ALL!
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Proceed with
Caution!
• Never pay a fee to file the FAFSA
– When filing a FAFSA, make sure you go directly to:
www.fafsa.gov (not www.fafsa.com)
– Contact Department of Education 1-800-4FEDAID for
help
• Never pay for financial aid assistance!
– Financial Aid Nights
– Campus Tours
– Scholarship Searches
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Get FAFSA Help
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IRS Data Retrieval- Tips
• Must have valid SSN and
FAFSA PIN number
• Must have filed 2013 taxes
(1040/1040A/1040EZ)
• Available for use 2 weeks after
completing 2012 tax returns
• Look up address through
USPS.com
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IRS Data Retrieval- Tips
Ineligible to use DRT
• Married but filed taxes separately
• Student or Parents that married after December 31, 2013
• Filed amended tax returns
• Filed Puerto Rican or foreign tax returns
*The IRS often processes returns for those receiving refunds
first. If you owe taxes, your return may not be processed for
a while which may cause a delay in your being able to use the
DRT.
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Assets and the FAFSA
Assets Included
• Cash, Savings & Checking
Accounts
• Value of business land,
buildings, equipment,
inventory, etc. for
companies with 100 or
more employees.
• Education IRA’s
• College Savings Plans
(529’s)
Assets Not Included
• Home in which you live ~
including family farm
• Value of life insurance
and retirement plans
(pensions, annuities,
Keogh’s non-education
IRA funds, etc.)
• Personal vehicles
***Any questions about what should or should not be
included, you may contact your school’s Financial Aid
Office.
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Presentation Author, 2006
Expected Family Contribution (EFC)
(Federal Methodology established by U.S. Congress)
Determined by filing the FAFSA
www.FAFSA.gov
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Main Determinants of the EFC
• Income
• Assets
• Family size
• Number in College
• Age of Older Parent
*Adjustments to EFC may be made due to
Verification and/or Special Circumstances that limit
ability to pay
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Financial Need Defined
Cost of Attendance (COA)
– Expected Family Contribution (EFC)
= Financial Need
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After you file the FAFSA
• Results are sent electronically to the college(s) the student
selected.
• Students may be required to verify the information
submitted on the FAFSA:
- 2013 tax transcript OR IRS Data Retrieval
required
• After the student is admitted to a college, a financial aid
package will be prepared.
• ***Contact the college with any Special Circumstances.
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What is Financial Aid?
• Grants
• Scholarships
• Loans
• Employment
opportunities
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Need versus Merit Aid
• Aid based on financial need
– Most government grants
– Subsidized student loans
– Federal Work-Study
• Aid based on merit
– Academic and athletic scholarships
– Some government grants
• Some scholarships require merit and need
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Gift Aid
Grants & Scholarships
• Federal (Administered by schools)
• Federal Pell Grant
• Federal SEOG
• TEACH Grant
• State (Administered by HEAB, DPI-WEOP & Schools)
• Wisconsin Higher Ed Grant (WHEG)
• Institutional (Endowment funds from Schools)
• Private (Various outside organizations)
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Self-Help Aid
Loans
• Federal Direct Loan
• Federal Perkins Loans
• Federal Direct PLUS (Parents)
• State or Institutional Loans
• Private-Alternative Loans
Employment
• Federal Work Study (earned as wages)
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Federal Direct Loans
Two types of Direct Loans:
– Subsidized - no interest accrues while in
school or in deferment (Interest rate of
3.86% 2013-2014)
– Unsubsidized - interest begins immediately,
although repayment is not required
immediately: (Interest rate of 3.86% 20132014)
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Direct Loan Limits
Total
Maximum
Subsidized
Freshman
$5,500
$3,500
Sophomore
$6,500
$4,500
Junior/Senior
$7,500
$5,500
5th Year/Other
$7,500
$5,500
Cumulative maximum for dependent undergraduate is
$31,000, with no more than $23,000 in subsidized loans.
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What Are the Costs?
+
+
+
+
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Tuition and Fees
Room and Meals
Transportation
Books & Supplies
Miscellaneous Living Expenses
Cost of Attendance (COA)
Financial Need Varies by School
1
Cost
2
3
$ 37,850 $ 23,378 $ 15,806
Less EFC $ 17,074 $ 17,074 $ 17,074
Need
$ 20,776 $
X
25
6,304 $
Y
0
Z
How to Compare College
Financial Aid Offers
• Start with tuition, fees, room and meals
• Subtract grant and scholarship offers
only
• The difference is your “net cost”
• Always compare net cost
• Do not subtract Federal Work Study as a
lump sum disbursement
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Other Financing Options
- PLUS (Parent Loan for Undergraduate Student)
- Private Educational Loans
- Monthly Payment Plans
- Home Equity Loans
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WWW.WISCONSINCOVENANT.WI.GOV
• Graduate from a Wisconsin high school.
• Maintain at least a B average while in high school.
• Take classes in high school that will prepare me for entrance into
higher education and will meet or exceed college entrance
requirements.
• Demonstrate good citizenship and engage in activities that support
my community.
• Apply for state and federal financial aid in a timely manner.
• Apply and do all that is necessary to gain admission to a University
of Wisconsin System institution, a Wisconsin Technical College,
and/or a Wisconsin private college or university.
Other Sources of Funds
Parental Affiliations
– Employers & Labor Unions
– Religious and Community
Organizations
– Clubs and Civic groups
Civic organization scholarships
– High School
– Local Public Library
Private business scholarships
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Government Resources
• Corporation for National and Community
Service
• Veteran’s benefits
• ROTC Scholarships and/or stipends
• Bureau of Indian Affairs (BIA) Grants
• State Divisions of Vocational Rehabilitation
(DVR)
• Health and Human Services Loan and
Scholarship Programs
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Federal Student Aid- Great Resource!
www.studentaid.ed.gov
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FAFSA4caster
• FAFSA4caster will:
– Instantly calculate estimated
eligibility for federal student
aid
– Provide you with basic
information about funding
resources through
government
– Give you a starting point of
what to expect
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Helpful Websites to Remember:
• www.fafsa4caster.ed.gov
• www.PIN.ed.gov
• www.FAFSA.gov
• www.collegegoalwi.org
• www.studentaid.ed.gov
• www.KnowHowToGo.org
• www.Going2College.org
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Questions?
Thank you for attending!
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