What You Need to Know
About Financial Aid
Bishop McNamara High School
Senior Parent Financial Aid Meeting
12.8.15
Topics We Will Discuss Tonight
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What is financial aid?
Categories and types of financial aid
Financial need
Expected Family Contribution (EFC)
Cost of Attendance (COA)
Resources for financial aid
Free Application for Federal Student Aid (FAFSA)
Special Circumstances
What is Financial Aid?
Financial aid consists of funds
provided to students and families to
help pay for postsecondary
educational expenses.
Categories of Financial Aid
• Need-based aid
• Awarded based on family’s ability to pay.
• Must file financial aid application(s).
• Non-need based aid
• Academic, athletic, leadership scholarships based strictly on student’s achievement.
• Allow schools to “shape” their student body.
• Research college publications and website for requirements.
Types of Financial Aid
• Scholarships
Gift Aid
• Grants
• Loans
Self-Help Aid
• Employment
Gift Aid
Scholarships
• Money that does not have to be
paid back.
• Awarded on the basis of merit,
skill, or unique characteristic.
Grants
• Money that does not have to be
paid back.
• Usually awarded on the basis of
financial need.
Self Help Aid
Loans
Work-Study
• Money students and parents borrow to
• Allows students to earn money to help
help pay college expenses.
• Repayment usually begins after
education is finished.
• Only borrow what is really needed.
• Look at loans as an investment in the
future.
pay educational costs.
• A paycheck; or
• Nonmonetary compensation such as
room and board.
• Students may opt whether or not to
work or number of hours to work.
Determining Need
Principles of Need Analysis
• To the extent they are able, parents have primary responsibility.
• Students also have a responsibility to contribute to their educational costs.
• Families should be evaluated in their present financial condition.
• Special conditions allow for extenuating circumstances.
Federal Methodology
• Formula created by congress to determine estimated family contribution
(EFC).
• Calculated via the Free Application for Federal Student Aid (FAFSA).
• Required by all schools for need-based aid.
What is Expected Family Contribution (EFC)?
• Amount family can reasonably be expected to contribute
• Stays the same regardless of college
• Two components
• Parent contribution
• Student contribution
• Calculated using data from a federal application form and a federal formula
Expected Family Contribution (EFC)
• Parental Income
• Parental Assets
• Student Income
• Student Assets
Parental Contribution
EFC
Student Contribution
EFC – Student’s Contribution
Account Title
Account Type
Whose Asset on FAFSA
Parent in trust for Child
Totten Trust
Parent
Child in trust for Parent
Totten Trust
Child
Parent and Child
Joint Account
Split Evenly
Child and Parent
Joint Account
Split Evenly
Parent as custodian for Child
Custodial Account
Child
Parent as a trustee for Child
Custodial Account
Child
What is Cost of Attendance (COA)?
• Direct Costs
• Tuition & Fees
• Room & Board
• Indirect Costs
• Books & supplies, including computer
• Transportation
• Misc./personal
• Study Abroad
• Direct and indirect costs combined
into cost of attendance (COA).
• Varies widely from college to college.
What is Financial Need?
EFC & Financial Need
On-Campus
Private
On-Campus
Public
Commuter Public
Cost of Attendance (COA)
$43,921
$19,548
$11,438
Estimated Family Contribution (EFC)
$17,000
$17,000
$17,000
Financial Need
$26,921
$ 2,548
$
-0-
Estimating Costs
FAFSA4Caster
Net Price Calculator
• Each school is required to post on it’s
website.
• Some schools have it on its admissions page;
other on the financial aid page.
www.fafsa.ed.gov
• Depending on the school’s financial aid
structure, requested information could
include academic as well as financial data.
• Provides an estimated financial aid package.
Sources of Aid
Sources of Financial Aid
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Federal Government
States
Colleges and universities
Private sources
Civic organizations and churches
Employers
Federal Government
• Largest sources of financial aid.
• Aid warded primarily on the basis of financial need.
• Must apply each year using FAFSA.
Federal Student Aid Programs
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Federal Pell Grant
Federal Supplemental Educational Opportunity Grant (FSEOG)
Teacher Education Assistance for College and higher Education (TEACH) Grant
Subsidized and Unsubsidized Federal Direct Student Loans (Direct Loans)
Federal Work-Study (FWS)
Iraq and Afghanistan Service Grant (IASG)
PLUS Loans
States
• Residency requirements usually apply
• Award aid on the basis of both merit and need
• Use information from the FAFSA and/or state aid applications
• Deadlines vary by state
• Maryland deadline is 3/1/16
Maryland State Scholarship Programs
• Academic Common Market
• Guaranteed Access Grants
• Separate application.
• Educational Assistance Grants
• File FAFSA before 3/1/15
• Senatorial Scholarships
• Contact Senator’s office
• Delegate Scholarships
• Contact each of 3 Delegates
www.mhec.state.md.us
District of Columbia Residents
• In-state tuition at most public colleges and
universities.
• $2,500 toward tuition at private schools in D.C.,
Maryland, and Virginia.
• Must apply using the DC OneApp.
(dconeapp.dc.gov)
• Application window is February 1st- June 30th .
dconeapp.dc.gov
Individual Colleges and Universities
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Award aid on the basis of both merit and need.
Aid may be gift aid or self-help aid.
Use information from the FAFSA and/or institutional applications.
Deadlines and application requirements vary by institution.
• PRIORITY DEADLINE is February 15, 2016
• Check with each college or university
Private Sources
• Foundations, businesses, charitable organizations.
• Deadlines and application procedures vary widely.
• Begin researching private aid sources now.
• Check Naviance for scholarship opportunities.
Civic Organizations and Churches
• Research what is available in the community.
• To what organizations and churches do student and family belong?
• Application process usually occurs during spring of senior year.
• Small scholarships add up!
Employers
• Companies may have scholarships available to the children of employees.
• Companies may have educational benefits for their employees.
Applying for Aid
Free Application for Federal Student Aid
(FAFSA)
• A standard form that collects demographic and financial information about
the student and family.
• May be filed electronically or using paper form.
• Information used to calculate EFC
• Amount of money a student and his or her family may reasonably be expected to
contribute towards the cost of the student’s education for an academic year.
• Colleges use EFC to award financial aid.
FAFSA
• May be filed at any time during an academic year, but no earlier than the
January 1st prior to the academic year for which the students requests aid.
• For the 2016-2017 academic year, the FAFSA may be filed beginning January
1, 2016.
• Most colleges set FAFSA filing deadlines.
• Often around February 15, 2016.
FAFSA on the Web (FOTW)
• Website: www.fafsa.gov
• 2016-2017 FAFSA on the Web
available on January 1, 2016.
• FAFSA on the Web Worksheet:
• Used as “pre-application” worksheet
• Questions follow order of FAFSA on
the Web
FAFSA on the Web (FOTW)
• Good reasons to file electronically:
• Built in edits to prevent costly errors.
• Skip-logic allows student and/or parent to skip unnecessary questions.
• Option to use Internal Revenue Service (IRS) Data Retrieval Tool to
import tax data.
FAFSA on the Web (FOTW)
• Good reasons to file electronically:
• More timely submission of original application and any necessary
corrections.
• More detailed instructions and “help” for common questions.
• Ability to check application status online.
• Simplified application process in the future.
IRS Data Retrieval Tool
• While completing FOTW, applicant may submit real-time request to IRS for
tax data.
• IRS will authenticate taxpayer’s identity.
• If match found, IRS sends real-time results to applicant in new browser
window.
• Applicant chooses whether or not to transfer data to FOTW.
IRS Data Retrieval Tool
• Available early February 2016 for 2016-17 processing cycle.
• Participation in voluntary.
• Reduces documents requested by financial aid office.
FSA ID
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https://fsaid.ed.gov/npas/index.htm
Sign FAFSA electronically.
Not required, but speeds processing.
May be used by students throughout
aid process, including subsequent
school year.
• Only the owner should create a FSA
ID.
Replies and Awards
FAFSA Processing Results
Central Processing System (CPS) notifies student of FAFSA processing results
by:
• Paper Student Aid Report (SAR) if paper FAFSA was filed and student’s
email address was not provided.
• SAR Acknowledgement if filed FAFSA on the Web and student’s email was
not provided.
FAFSA Processing Results
• CPS notifies student of FAFSA processing results by:
• Email notifications containing a direct link to student’s online SAR if student’s email
was provided on paper or electronic FAFSA
• Student with FSA ID may view Student Aid Report (SAR) online at
www.fafsa.gov.
FAFSA Processing Results
• Institutional Student Information Record (ISIR) sent to colleges listed on
FAFSA approximately 10 to 14 days after FAFSA submitted
• College reviews ISIR.
• May request additional information.
Student Aid Report
• Review data for accuracy and correct any errors.
• Update estimated tax information when actual figures become available.
Making Corrections
• If necessary, corrections to FAFSA data may be made by:
• Using FAFSA on the Web if student has FSA ID;
• Updating paper SAR (SAR Information Acknowledgement cannot be used to make
corrections);
Or
• Submitting documentation to college’s financial aid office.
Financial Aid Award Letters
• After a college accepts you, you'll receive a letter that outlines how much the school
will cost and what kind of financial aid package you'll receive — including federal,
state, and school sources.
• There’s no standard format for schools’ award letters, but they contain the same
overall information:
• How much your year in college will cost
• The financial aid package that the school is giving you
• What portion your family is expected to contribute
• Any gap you’ll have to make up through other sources
Sample Financial Aid
Award Letter
Special Circumstances
• Cannot be documented using FAFSA.
• Send WRITTEN explanation and documentation to financial aid office at
each college.
• College will review and request additional information if necessary.
• Decisions are final and cannot be appealed to U.S. Department of
Education.
Special Circumstances
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Changes in employment status.
Unusual medical expenses not covered by insurance.
Change in parent marital status.
Unusual dependent care expenses.
• High school/elementary school costs
• Student cannot obtain parental information.
Gapping
• If you have substantial unmet financial need you should try to delicately
negotiate with the college or university.
• Find out whether the college has protocol in place.
• Write a letter, and be professional but passionate.
• Make a compelling case….whenever possible, using numbers.
• Be confident.
• Gather support.
• Think outside the box.
CSS Profile
• Designed to give schools a closer look
into parent and student finances
• About 300 member schools.
• Submit registration form listing
schools to receive information.
• Will be sent application to be
completed with questions based on list
of schools.
• Can take care of both steps on-line at
http://profileonline.collegeboard.com.
• $25 registration fee includes first
school; $16 per additional school.
You must reapply to FAFSA every
year.
Summary and Tips
Applying for Aid: Common Errors
• Divorced/remarried parent information.
• Should be parent with whom student resides and step-parent, if appropriate.
• Income earned by parents/stepparents.
• Adjusted gross income
• Untaxed income.
• All money received should be included
• US taxes paid.
• Not taxes withheld
Applying for Aid: Common Errors
• Household size
• Do not include independent students or children who have moved out of the house.
• Number in postsecondary education.
• Do not include independent students or parents.
• Real estate and investment net worth.
Q&A
When in doubt call and talk to a financial aid representative at
the college or university in question.