Financial Aid 101 -- Understanding the Financial Package
Financial Aid 101-
Understanding your Student’s College Financial Aid
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How do I pay for college?
•$16,141 average, in state, 4-year public universities
•$28,130 average, out of state, 4-year public universities
•$36,993 average, 4-year private universities
Source: The College Board, Annual Survey of Colleges, 2010
Financial Aid 101 – Getting Started
Understanding Your Student’s College Financial Aid
• Everyone agrees that college is expensive these days, and
most of us need financial help to be able to afford it.
• The financial aid letter which your student receives from his
college may include several different types of aid. Although
understanding the finer points of these different types of aid
and loans may at times seem like a full time job, it is
important to have a general understanding of the different
types of help your student’s school may offer.
Financial Aid 101 – Getting Started
How do schools determine aid?
• Most schools use the FAFSA (Free Application for Federal Student Aid)
form to determine your financial need.
• The FAFSA is filled out and filed with
the federal government and the information Be sure to check
is sent to the schools that you request. with your
• The FAFSA is available in January of each year for all required
and can be completed on-line.
The federal government is working to make the
FAFSA a bit simpler each year.
• Most schools also require students to complete additional financial
information for the school’s financial aid office. Schools will also ask you
to report any outside scholarships which your student is receiving as that
will be a factor in determining the aid package.
Financial Aid 101 – Types of Financial Aid
Very generally, there are two categories of financial aid – Need
based aid and non-need based aid or merit aid. More specifically,
there are several different types of aid which might appear in your
student’s financial aid letter. It is important to recognize that they are
Scholarship & Grants
• Scholarship & grants are often based on merit or given to
particular categories of students.
• They are a type of gift aid and do not need to be repaid.
Federal Work Study
• Federal work-study is money that your student may earn from a
campus job. (Not all campus jobs are work-study jobs)
• Federal Work Study funds are given by the government to the
college to disburse.
• Loans will need to be repaid with interest. Loans may be in your
name or in your student’s name, and are called self-help
assistance since you are responsible for repaying them later.
Financial Aid 101 – 3 Steps to Follow
Understanding your student’s financial aid package takes effort, but is extremely
important. Take time to do your research and don’t hesitate to contact the
school’s financial aid office for help in understanding the many types of aid.
Create a Saving College Apply for Financial
Plan Approaches Aid
• Start saving as • Determine how • Apply for
early as possible much aid your Financial Aid
child will need every year
• Figure out the and how much
cost of your family will • Apply by
attendance be expected to submitting
contribute the Free
• Maximize your Application for
• Determine how
eligibility for Federal Student
much you need
financial aid Aid (FAFSA)
to save on a
regular basis to • Encourage your
reach your child to search • The Education
savings goals. for Scholarships Tax Credits can
• Private help you defray
Loans can college costs
• Consider 529
You have questions, we have answers!
College Parents of America and get more tips and advice on:
How and why to help your student create a budget;
What’s the latest change on FAFSA;
What is federal work study; and Much More…
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