Financial Aid: Getting your
Fair Share
By Dennis Bye
Member National Financial Aid Practitioner’s Alliance
3/19/2016
Introduction
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Cost of Education
Ivy League 60,000
Private 47,000
State School 29,000
Public schools up 2.9%
Private schools up 3.7%
Inflation 1.7%
Source CEEB
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Myths
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Myth 1 Middle Income Families Don’t
Qualify for Aid
Myth 2 You Cannot Impact Aid Eligibility
Myth 3 Only Students with good grades
qualify
Myth 4 You have to be a minority to get
financial aid
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The Financial Aid Forms
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FAFSA
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PROFILE
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These forms are necessary for Federal,
State, and/or Institutional Aid
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Deadlines
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Filing financial aid forms late may cost you
money
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Many Families Find These
Forms Confusing and
Intimidating
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And Experience
Hours of
Frustration Trying
to Complete Them
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Family Assets and Income
Are Among the Many Factors Assessed to
Determine Aid Eligibility
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The Information from the
financial aid forms
is calculated in
NEEDS ANALYSES FORMULAS
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The Weighting of this
Information Establishes Your
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EXPECTED FAMILY CONTRIBUTION
(EFC)
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…. This is How Much the
Government Feels You Can
Afford to Pay
Ouch!!!
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Cost of Attendance
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Tuition and Fees
Room & Board
Books, Travel & Personal
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Financial Need
COLLEGE COST - EFC =NEED
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EFC Example
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Need Based Aid
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Aid Comes From
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Federal > Grants > Loans > Work Study
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State > Grants > Scholarships
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College > Grants > Loans
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Federal Grants and Loans
Pell Grant $5,730
SEOG
$4,000
Perkins Loan
Sub Stafford
$5,500
$3,500
5%
4.66%
Unsub Stafford $3,500
4.66%
PLUS Loan
4.29%
7.21%
3/19/2016
State Programs
www.hesaa.org
TAG county 2,318,St College 6,326, Ind College
10,468, Rutgers 8,554, NJIT 9,692
NJ Class Loans 5.49% 3% orig fee 10 yr.
6.65% 3% orig fee 15 yr
8.05% 3% orig fee 20 yr
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Financial Aid Awards
The Award Letter
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Compare Packages
No Absolutes
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Award Letter
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School
Cost
Family Cont.
NEED
A
30,000
10,000
20,000
B
30,000
10,000
20,000
Students Loans
Work Study
State Aid
Grant
TOTAL
3,500
1,500
2,000
13,000
$20,000
4,500
2,000
2,000
5,500
$14,000
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Public vs. Private College
Rutgers
Total Cost
Need
% need fully met
Financial aid eligibility
Gift aid 46%
Self help 54%
Out of pocket cost
Total cost - gift aid
Loyola
$29,875
$19,875
12%
$2,385
$1,099
$1,287
$27,461
$28,776
Total Cost
Need
%need fully met
Financial aid eligibility
Gift aid 70%
Self help 30%
Out of pocket cost
Total cost - gift aid
$59,320
$49,320
95%
$46,854
$32,797
$14,056
$12,467
$26,523
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Maximizing Aid Eligibility
Understanding The Federal Formula
May Save You
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ASSET VALUATION
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INCLUDED
Cash
Savings
Stocks
Bonds
Mutual Funds
Real Estate
Business
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EXCLUDED
Retirement Accounts
Cash Value of Life
Insurance
Annuities
Primary Residence
(Federal Only
Family Farm (Federal
Only
Consumer Assets
Consumer Debt
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Parent Income Protection
Allowance
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Family of 4…. $25,000
Family of 5….$30,000
Family of 6….$35,000
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Asset Protection Allowance
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Age 46…. $47,700
Age 47…. $47,900
Age 48…. $50,100
Age 49…. $51,300
Age 50…. $52,900
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How Many Family Members
are Attending College ?
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Understand The Logistics For
Proper Filing Of Special
Conditions
Single-Separated-Divorced
Parents Loss of Employment...
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Retirement Contributions
IRA’S
401K’s
TSA’S
As Income?
As Assets?
Are included as untaxed income on the financial aid
forms. The value of these accounts are not included
as an asset.
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How Do I make My Child
Independent?
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VERIFICATION
THE PROCESS OF
SUBSTANTIATING FINANCIAL
AID INFORMATION
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EDUCATION TAX
INCENTIVES
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American Opportunity Credit
Available for the first four years of post secondary ed.
Up to $2,500 per eligible student
100% OF THE FIRST $2,000.00
25% OF THE NEXT $2,0000.00
Phaseout $180,000 MFJ
$90,000 S,H of H
Available all four years of undergraduate education
Use form 8863 education credits
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Lifetime Learning Credits
20% of the first $10,000 (no limit to the number of
years) can be used for non degree study. Up to $2,500
credit per return
Phase-out: $127,000 MFJ
$63,000 S, H of H
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Student Loan Interest Deduction
Can reduce income up to $2500.00
$155,000 MFJ
$75,000 SHH
Can take this with claiming American Opportunity
Credit
Lifetime Learning Credit
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Tuition and Fees Deduction from
Income
Reduce Income by up to $4000.00
Limits: $ 160,000 MFJ
$ 80,000 SHH
Can not take this deduction if claiming American
Opportunity Credit or Lifetime Learning Credit
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SECTION 529 PLANS
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DISTRIBUTIONS ARE TAX FREE FOR
EDUCATION
“ ASSETS of the OWNER”
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What I can do for you
Ensure you will qualify for the maximum amount of
aid you are legally entitled to!
Calculate your EFC
Expertly complete the financial aid forms
Advise how to pay what isn’t subsidized with
financial aid
Advise you on the most tax efficient way to pay for
college
Remain a year-round resource for your financial
planning needs!
Website www.financialaidnj.com
3/19/2016
Services Provided
Ensure you qualify for the maximum amount of Financial aid
Calculate your expected family contribution
Complete the FAFSA
Complete the CSS Profile if required
Advise how to pay the balance that is not subsidized with financial aid
Advise you on the most tax efficient way to pay for college
Provide planning recommendations to potentially reduce your EFC
Advise on where to get the lowest interest loans for which you qualify
Keep you appraised of changes in financial aid on the national and state level
Advise you on which colleges are likely to give the most financial aid
Review award letters for fairness
Remain a year round resource for your financial planning needs
3/19/2016