Navigating College Financial Aid
Program Analysis
Dr. Herm Davis
301-548-9423
hdcfaces@comcast.net
www.drhermdavis.com
Higher Education in Maryland
Institution
Year Founded
Washington College
1782
St. Johns of Annapolis
1784
University of Maryland at
Baltimore
1807
Mount St. Mary’s
1808
MICA
1826
U.S.N.A
1840
U.M.C.P
1845
John’s Hopkins University
1857
Bowie State University
1865
Towson University
1866
McDaniel College
1867
College of Notre Dame
1873
Goucher College
1885
UMES
1886
Hood College
1893
Frostburg University
1898
COLLEGE SELECTION PROCESS
1)
2)
3)
4)
Quality of Education
Happiness
Security and Health
Affordability
“Top 10 Best Colleges: Public Schools National Universities” VS. “Top 10 Party Schools”
Top 10 Public Schools National Universities
(U.S. News & World Report)
Top 10 Party Schools
(Princeton Review rankings)
1
University of California – Berkley
University of Georgia – Athens
2
University of California – Los Angeles
University of Virginia
Ohio State University
3
University of Michigan – Ann Arbor
Penn State University – University Park
4
University of North Carolina – Chapel Hill
West Virginia University
5
College of William and Mary
Georgia Institute of Technology
University of Mississippi
6
University of California – San Diego
University of California - Davis
University of Texas – Austin
7
University of California – Santa Barbara
University of Texas - Gainesville
8
University of California – Irvine
University of Washington
University of California – Santa Barbara
9
University of Texas – Austin
University of Wisconsin - Madison
University of Iowa
10
Penn State University – University Park
University of Illinois
University of Florida
Ohio State University
Purdue University
University of Georgia - Athens
University of Maryland – College Park
Depauw University
Components for Discussion
1 – Overview
2 – Forms Analysis
3 – Process Analysis
4 – FAFSA / CSS Profile Preparation & Analysis
5 – Resource Analysis
6 – Award Analysis
Overview of the Financial Aid Process
How to start the Financial Aid Process –
KNOW your 4 worst enemies!
Enemy #1 – Cost of Attendance
Enemy #2 – Missed deadlines
Two main reasons:
“Student must be admitted before filing for aid” – WRONG!
“Parents must have their Federal income taxes submitted” – WRONG!
Enemy #3 – Self discrimination
Two main reasons:
“We make too much to file for aid” – WRONG!
“We can’t afford a private college” – WRONG!
Enemy #4 – Your College Student
•
Student needs to check college’s financial aid website
•
Parents need to obtain their student’s ID and password
4-year College Graduation Comparison Chart
www.collegeresults.org
(1 of 2)
College or University
2011
4-Year
Grad Rate
% Pell
Recipients
Among
Freshman
Estimated
median
SAT/ACT
State
Size
(Undergrad
FTE)
Duke University
88.5%
13%
1440
NC
6,697
Wake Forest University
82.4%
14%
1325
NC
4,657
University of Richmond
76.5%
14%
1280
VA
3,457
Loyola University Maryland
79.2%
14%
1198
MD
3,807
Johns Hopkins University
84.4%
12%
1395
MD
5,820
University of North Carolina
at Chapel Hill
75.2%
20%
1310
NC
18,579
Elon University
77.5%
10%
1215
NC
5,032
Carnegie Mellon University
71%
13%
1400
PA
5,830
4-year College Graduation
Comparison Chart (2 of 2)
College or University
4-Year
Grad
Rate
% Pell Recipients
Among
Freshman
Estimated
median
SAT/ACT
State
Size
(Undergrad
FTE)
University of MarylandCollege Park
66.1%
15%
1290
MD
25,535
Pennsylvania State UniversityMain Campus
63%
16%
1195
PA
37,763
Indiana University-Bloomington
49.8%
21%
1170
IN
31,427
Salisbury University
46.4%
21%
1130
MD
7,304
North Carolina State University
at Raleigh
40.8%
25%
1180
NC
23,172
Towson University
39.3%
21%
1075
MD
16,216
Hood College
60.2%
28%
1065
MD
1,393
East Carolina University
32.5%
34%
1040
NC
19,710
FAFSA Forms Analysis
► Free
Application for Federal Student Aid
(FAFSA)
► CSS
Profile
► Institutional
► Verification
Aid Application (IAA)
Work Sheet (VWS)
Free Application for Federal Student
Aid (FAFSA)
► www.fafsa.gov
► Cost:
Free
► Submit for each student per year
immediately after Jan. 1st.
► PIN Required to sign electronically
► www.pin.ed.gov
► fafsa4caster.ed.gov
CSS Profile
► https://profileonline.collegeboard.com
► Cost
is $25 for the initial application and
$16 to add additional schools
► CSS
► CSS
Non-Custodial Parent Profile cost is $25
IDOC (Institutional Documentation
Service)
Institutional Supplemental Forms
► Institutional
Aid Application (IAA)
“Institutional Funding Form”
Financial Aid Form found on college
financial aid website
► Verification
Work Sheet (VWS)
-IRS Data Retrieval Tool (DRT) FAFSA Update
-VWS Form + w-2’s +IRS Tax Transcript
IRS ph: 1-800-908-9946
Process Analysis
► Online
processing
► How colleges receive data
► How to correct data
► EFC Formula
► Awarding of Aid Formula
ONLINE FAFSA Flow
FAFSA entered by
Student/Parent
Student
Student Aid Report
SAR
School
ISIR
Individual Student
Information Report
Central
Processor
Student
Corrections
1.
4.
2.
5.
3. __ 6.
10.__
7.__
8.__
9.__
School
Award “Package”
Process
Maryland State Scholarship
Include a Maryland College
on the FAFSA
School
Award Letter Sent
to Student
FAFSA Preparation
-Who fills out the FAFSA?
Parent(s) of the student, where the student
has resided more than 50% of time of the
calendar year.
- Who’s information do you use?
Parent(s) who are married or remarried OR
Single, Divorced, Separated or Widowed?
FAFSA Preparation
► Student
Financial Information
“As of today, what is your (student’s) total
current balance of cash, savings and checking
account(s)?”
“As of today, what is the net worth of your
(student’s) investments, including real
estate…”
FAFSA Preparation
► Parent(s)
Financial Information
“As of today, what is the parent’s total current balance of
cash, savings and checking account(s)?”
“As of today, what is the net worth of the parent’s
investments, including real estate? (Don’t include the home in
which your parents live. Net worth means current value
minus debt.)”
“As of today what is the net worth of your parent’s current
business and/or Investment farms? (Don’t include a family
farm o family business with <100 FT employees)”
EFC FORMULA
EFC = Expected Family Contribution
(ESC-I)
Expected Student Contribution from Income
+ (ESC-A) Expected Student Contribution from Assets
+ (EPC-I)
Expected Parent Contribution from Income
+ (EPC-A) Expected Parent Contribution from Assets
= (EFC)
[Expected Family Contribution]
FAFSA Preparation
Question?
What is the value of your
cash, checking, savings
account?
What is the Value of
investment accounts
excluding all retirement
accounts?
What is the value of your
business account
(excluding a family farm or
family business with <100
FT employees)?
Student
$ 10,000
Parent
$ 20,000
$ 6,000
$ 50,000
$
$
20%
Age
APA
Award Calculation
LC
MC 1
MC 2
HC
COA
$16,000
$20,000
$40,000
$60,000
-EFC
$12,000
$12,000
$12,000
$12,000
= NEED
$4,000
$8,000
$28,000
$48,000
FAFSA / CSS Profile
Preparation and Analysis
FAFSA
Step-by-step Preparation
Item Analysis
CSS Profile
Step-by-step Preparation
Item Analysis
Student’s Income
Student’s Income
Student’s Assets
Student’s Assets
Parent’s Income
Parent’s Income
Business/Farm Income
Untaxed Social Security
Income
-NO Untaxed Social Security
Parent’s Assets
-NO Home Equity, Retirement Plans or
Business and Farm Assets
Parent’s Assets
Including:
- Home Equity
-Retirement Plans
-Business and Farm Assets
Number in College
Number in College
Special Circumstances
Non-Custodial Profile
Asset Protection Allowance
Age of older
parent as of
12/31/13
Allowance if there
are 2 parents
Allowance if there
is only one parent
40
$27,300
$6,300
44
$30,000
$6,900
48
$33,000
$7600
50
$34,600
$8000
52
$36,500
$8300
54
$38,500
$8700
56
$40,600
$9200
60
$45,500
$10,200
64
$50,900
$11,300
65 and over
$52,000
$11,600
Example: If the age of the older parent is 50 and 2 parents are in the household:
The asset protection allowance is $34,600
RESOURCE ANALYSIS
Self Help Programs (Awarded before gift aid)
Work-study or student employment programs: federal and college.
Loans: Direct Loans, PLUS Loans and Private Loans –
borrowed money that you must pay back, usually with interest.
Gift Aid Programs – “Free Money”
Grants – Need Based
Money you don’t have to repay, typically based on financial need.
Scholarships – Merit and May be Need Based
Institutional, State and Private
Free money awarded usually based on your area of study or merit.
Federal Loans: The smart way to borrow
► Federal
Direct Loans
Subsidized Direct Loans
►Based
solely on financial need
►Federal government pays the interest while you are
in school
Unsubsidized Direct Loans
►All eligible students can receive them, regardless of
income or assets
►You’re responsible for paying the interest while in
school.
Federal Direct Loan Limits
Year
Dependent
Undergraduates
Independent
Undergraduates
Graduate and
Professional
Students
First Year
$3,500 + $2,000 = $5,500
$9,500
Second Year
$4,500 + $2,000 = $6,500
$10,500
$20,500 – (effective
7/1/12- Grad Student
Loans are only
Unsubsidized)
Third Year
$5,500 + $2,000 = $7,500
$12,500
Fourth Year
$5,500 + $2,000 = $7,500
$12,500
Total amount
you can
borrow
$27,000
$45,000
_________________
Interest Rates –
SEE Next Slide
Federal Direct Loan Interest Rates
Loan Type
Current Interest Rates
( NOT Fixed rates)
Undergraduate Direct Loan
From 3.9 %
Not to exceed 8.25%
Graduate Direct Loan
From 5.4%
Not to exceed 10.5%
Direct PLUS Loan
(Parent Loan for Undergraduate
Students)
From 6.4%
Not To exceed 10.5%
Federal Pell Grant = $5,635
Federal Direct PLUS Loans
► Enable
parents or stepparents (whose
information is reported on the FAFSA) to
borrow up to the cost of attendance.
 Minus any other aid the student may receive
 Legal guardians cannot borrow PLUS loans .
(Resource Analysis Continued)
► Academic
Common Market
“College 411” Guide http://www.mhec.state.md.us
► Innovative
Opportunities
“Best College Deals” -www.petersons.com
► College
Graduation Rates by years of study
www.collegeresults.org
►
Net Price Calculator
http://netpricecalculator.collegeboard.org/
The Award Process
► Colleges
assign each student a password and user
name after the admissions applications are
received. The user name and password is
assigned to allow students to monitor their
admissions application, financial aid status,
academic record and billing statements.
► The
financial aid offices uses this process to
communicate with the students regarding their
financial application status.
(The Award Process Continued)
►
After each college receives the aid
application/documents it will post receipt of the
document on the student’s financial aid page.
1. The posting will tell the student the status of
the document received regarding its fulfillment.
2. If the college requires additional information, it
will post the listing on the student’s aid page.
(PROBLEM: Student fails to monitor his/her
financial aid page in order to take further action
and thus complete the aid application process.)
(The Award Process Continued)
► After
the student meets all requirements for awarding, the
aid office will post the award on the student’s account.
1. The awards will be posted for the student to accept or
decline.
2. If accepted, the student will be instructed regarding any
additional action to be taken.
(Note: A student should check his/her college email
account as well as their personal email account and regular
U.S.P.S)
(Problem: Student fails to monitor his/her financial aid page
to either accept or decline awards. In addition, even after
accepting, many times the student fails to complete the
award process by not fulfilling the loan application process.)
Navigating College Financial Aid
Program Analysis
Dr. Herm Davis
301-548-9423
hdcfaces@comcast.net
ww.drhermdavis.com