Financial Aid Primer
What is Financial Aid? There are two categories of financial aid:
- Need-based - financial aid that is based on the student's financial situation
- Merit-based - financial aid that is based on the student's achievements in areas such as academics or special talents such as music or athletics
Within each of these categories of financial aid, there are two types:
- Gift aid - financial aid that is given to you and you do not have to repay it. For example, scholarships or grants.
- Self help - financial aid that carries an obligation in order to receive it. For example, loans or employment.
How do I find out about Financial Aid? Early planning is essential. It is never too early to start, but the beginning of the junior year in high school is the recommended time to start looking. If you are already in college, it is not too late to start looking.
- The best starting point is the high school guidance counselor.
- The next point of contact is the financial aid office at the college or university. Obtain a catalogue and view the school's web site.
- Scholarship and financial aid searches are also important. Use the Internet for free searches.
- The U. S. Department of Education has excellent information. Call 1-800-4FEDAID or go to http://studentaid.ed.gov/ for further information.
What about paying for Scholarship Searches? Since there are excellent scholarship searches that are free, paying is not recommended. However, if you do pay for a search, buyers beware. Read the fine print.
How do I find out about Scholarships if I do not have access to a Computer? The public library is the answer. Most libraries have access to the internet and reference manuals that cover various financial aid programs. Investing an hour or so will probably yield programs that you may be eligible to apply. Commercial bookstores also have scholarship and financial aid manuals or computer disks.
How do I qualify for Financial Aid? In order to qualify for financial aid, the following is required:
- Need-based - Complete the Free Application for Federal Student Aid (FAFSA) by the priority deadline or the actual deadline. Students meeting priority deadlines will be evaluated first. Check each school or program for the priority deadline, usually between February and April of each year. An additional application to the school or program may also be required. FAFSAs are available from high school guidance counselors, financial aid offices, or TSAC. If you missed the priority deadlines, you may still receive aid as long as you apply before the actual deadline.
- Merit-based - Complete the applications that are obtained from financial aid offices or specific programs. Most have early actual deadlines, usually between November and March of each year.
What do SAR and EFC Mean? SAR is your Student Aid Report. This is the document that is received after a student completes the FAFSA. It contains the information that was entered on the FAFSA, instructions for correction of errors, and eligibility for the Federal Pell Grant and other federal financial aid. Your first choice school may want you to submit your SAR to the financial aid office. Check with the financial aid office. For duplicate SARs call 319-337-5665.
EFC is expected family contribution. The information entered on the FAFSA will be used in a formula that determines the amount that the family (student and/or parents) is expected to contribute to the cost of attendance.
What is Cost of Attendance (COA)? COA is the total amount it will cost a student to go to school for one year (two-semesters or three-quarters). It includes tuition, fees, books, on campus room and board (or off campus housing and food allowance), transportation, and miscellaneous expenses. The financial aid office at colleges or universities is responsible for determining COA.
How is Financial Need Defined? Financial need is the difference between Cost of Attendance and Expected Family Contribution. Schools use financial need to determine the amount of need-based assistance that a student is eligible for.
How much Financial Aid is available? Financial aid will vary at each school, but nationally, based on the latest data available, the following aid categories were awarded:
Federal Loan Programs 50% ($21 billion)
Federal Pell Grant 14% ($ 6 billion)
Federal Campus Based Programs 05% ($ 2 billion)
- Federal SEOG
- Federal Work Study
- Federal Perkins Loans
Other Federal Programs 05% ($ 2 billion)
School and Other Sources 19% ($ 8 billion)
State Grants 07% ($ 3 billion)
Note: Nearly 70% of the student aid awarded each year comes from the U. S. Department of Education program.
Twelve Useful Tips for Financial Aid Survival.
Tip #1: Read all you can about financial aid. Ask lots of questions.
Tip #2: Make a written plan. Prioritize your efforts. Share the plan with your parents.
Tip #3: Pay attention to your guidance counselor.
Tip #4: Establish a positive relationship with the financial aid staff.
Tip #5: Complete a scholarship before September 1 each year.
Tip #6: Complete the FAFSA before February 15 each year.
Tip #7: Inform financial aid administrators about special circumstances.
Tip #8: Be patient but persistent.
Tip #9: Don't throw anything away. Keep a file. Keep a phone journal.
Tip #10: Study, study, study. Have fun but study first.
Tip #11: If you work more than 15 to 20 hours per week, your grades may suffer.
Tip #12: Borrow what you need, not what you want.