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Fin. aid night

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Fin. aid night

  1. 1. Carroll University Dawn Scott Carrie Kropp Financing Education Beyond High School
  2. 2. Topics We Will Discuss Tonight <ul><li>What is financial aid? </li></ul><ul><li>Where does it come from? </li></ul><ul><li>What aid is available? </li></ul><ul><li>Definition of financial need and how it is determined </li></ul><ul><li>How to apply for financial aid, including FAFSA & how to avoid errors </li></ul><ul><li>Where to look for information about private sources of aid, including how to avoid being scammed </li></ul>
  3. 3. What is Financial Aid? <ul><li>Money available to families to help them pay for educational expenses. </li></ul>
  4. 4. What is Cost of Attendance (COA)? <ul><li>Direct costs (pay to the school) </li></ul><ul><ul><li>Tuition & Fees </li></ul></ul><ul><ul><li>Room & Board </li></ul></ul><ul><li>Indirect costs (costs associated with attending school) </li></ul><ul><ul><li>Books & Supplies </li></ul></ul><ul><ul><li>Transportation </li></ul></ul><ul><ul><li>Miscellaneous personal expenses </li></ul></ul><ul><li>Direct and indirect costs combined into cost of attendance </li></ul><ul><li>Vary widely from college to college </li></ul>
  5. 5. What is the Expected Family Contribution (EFC)? <ul><li>Two components </li></ul><ul><ul><li>Parent contribution </li></ul></ul><ul><ul><li>Student contribution </li></ul></ul><ul><li>Calculated using FAFSA data and a federal formula. Main components are: </li></ul><ul><ul><li>Family size </li></ul></ul><ul><ul><li># in college </li></ul></ul><ul><ul><li>Students income/assets </li></ul></ul><ul><ul><li>Parents income/assets </li></ul></ul><ul><li>Amount the family can reasonable be expected to contribute </li></ul><ul><li>Stays the same regardless of college choice </li></ul><ul><li>Colleges use EFC to award financial aid </li></ul><ul><ul><li>www.fafsa4caster.ed.gov </li></ul></ul>
  6. 6. What is Financial Need? <ul><li>Cost of Attendance (COA) </li></ul><ul><ul><ul><ul><li>- Expected Family Contribution (EFC) </li></ul></ul></ul></ul><ul><li> = Financial Need </li></ul>
  7. 7. Types of Financial Aid <ul><li>Gift Assistance </li></ul><ul><ul><li>Scholarships </li></ul></ul><ul><ul><li>Grants </li></ul></ul><ul><li>Self-help </li></ul><ul><ul><li>Loans </li></ul></ul><ul><ul><li>Employment </li></ul></ul>
  8. 8. Average % of Total Cost Paid From Source Group <ul><li>**How America Saves & Pays for College 2010 – Sallie Mae </li></ul>
  9. 9. Sources of Financial Aid <ul><li>Federal Government Programs </li></ul><ul><li>State Government Programs </li></ul><ul><li>Institutional Programs </li></ul><ul><li>Community Programs </li></ul><ul><li>National Programs </li></ul><ul><ul><li>www.fastweb. com </li></ul></ul><ul><ul><li>www.finaid.org </li></ul></ul><ul><ul><li>www.studentaid.ed.gov </li></ul></ul><ul><ul><li>www.collegeboard.com </li></ul></ul><ul><ul><li>www.gocollege.com </li></ul></ul>
  10. 10. Eligibility for Aid <ul><li>Based upon an analysis of data provided on the Free Application for Federal Student Aid (FAFSA) </li></ul><ul><li>Some institutions may require additional information to determine eligibility for their institutional resources </li></ul>
  11. 11. Federal Government <ul><li>Largest source of financial aid </li></ul><ul><li>Aid awarded primarily on the basis of financial need </li></ul><ul><li>Must apply every year using the FAFSA </li></ul>
  12. 12. Common Federal Aid Programs <ul><li>Pell Grant </li></ul><ul><li>Supplemental Education Opportunity Grant </li></ul><ul><li>TEACH Grant </li></ul><ul><li>Federal Perkins Loan </li></ul><ul><li>Federal Stafford Loans </li></ul><ul><li>Federal PLUS Loans </li></ul><ul><li>Federal Work Study </li></ul>
  13. 13. State Programs <ul><li>Residency Requirements </li></ul><ul><li>Award aid on the basis of merit and need </li></ul><ul><li>Use information from the FAFSA </li></ul><ul><li>Deadlines vary by state; check for deadline on FAFSA website ( www.fafsa.gov ). </li></ul>
  14. 14. You may be eligible for aid, but... <ul><li>You must apply to find out! </li></ul><ul><ul><li>Everyone will be eligible for a form of student loan. </li></ul></ul><ul><ul><li>Apply it is FREE! </li></ul></ul>
  15. 15. How to Apply for Financial Aid Easy as 1-2-3
  16. 16. Free Application for Federal Student Aid (FAFSA) <ul><li>A standard form that collects family’s demographic and financial information used to calculate the student’s EFC (available in English and Spanish) </li></ul><ul><li>How to apply: </li></ul><ul><ul><li>Paper FAFSA </li></ul></ul><ul><ul><li>FAFSA on the web at www.fafsa.gov </li></ul></ul>
  17. 17. College Goal Weekend <ul><ul><li>College Goal Wisconsin </li></ul></ul><ul><ul><ul><li>Free program to help families </li></ul></ul></ul><ul><ul><ul><li>complete the FAFSA </li></ul></ul></ul><ul><ul><ul><li>February 18-29, 2012 </li></ul></ul></ul><ul><ul><ul><li>Scholarship drawing at each site </li></ul></ul></ul><ul><ul><ul><ul><li>Provided by WASFAA and CACG </li></ul></ul></ul></ul><ul><ul><ul><li>30 sites throughout Wisconsin </li></ul></ul></ul><ul><ul><ul><li>Sponsored by WASFAA, along with several other partners </li></ul></ul></ul><ul><li>For location information: </li></ul><ul><li>visit www.wicollegegoalsunday.org </li></ul><ul><li>or call 1-866-578-4625 </li></ul>
  18. 18. FAFSA <ul><li>May be filed at any time during an academic year, but no earlier than the January 1 st prior to the academic year for which the student requests aid. </li></ul><ul><li>For the 2012-13 academic year, the FAFSA may be filed beginning January 1, 2012. </li></ul><ul><li>Colleges may set FAFSA filing deadlines. </li></ul>
  19. 19. FAFSA <ul><li>Information used to calculate the Expected Family Contribution or EFC </li></ul><ul><ul><li>The amount of money a student and his or her family may reasonably be expected to contribute toward the cost of the student’s education for an academic year </li></ul></ul><ul><li>Colleges use EFC to award financial aid </li></ul>
  20. 20. Items needed to complete the FAFSA <ul><li>Student and Parent Social Security numbers </li></ul><ul><li>Student Driver’s license </li></ul><ul><li>Student and Parent tax return and W-2 Information </li></ul><ul><li>Student and Parent current bank statements </li></ul><ul><li>Current Business and investment information, business and farm records, stock, bond and other investment records </li></ul>
  21. 21. FAFSA on the Web Worksheet <ul><li>2012-13 FAFSA on the Web Worksheet – </li></ul><ul><li>4-page booklet containing: </li></ul><ul><li>Instructions </li></ul><ul><li>22 questions in 4 sections </li></ul>
  22. 22. FAFSA On the Web (FOTW) <ul><li>Web site: www.fafsa.gov </li></ul><ul><li>12-13 FAFSA available on 1/1/2012 </li></ul><ul><li>FAFSA on the Web </li></ul><ul><li>Worksheet </li></ul><ul><ul><li>Used as a pre-application worksheet </li></ul></ul><ul><ul><li>Questions follow order of </li></ul></ul><ul><ul><li>FAFSA on the WEB </li></ul></ul>
  23. 23. List up to 10 schools to receive FAFSA data <ul><li>Federal School Code for each school </li></ul><ul><ul><li>6 digit number for all schools </li></ul></ul><ul><ul><li>Housing plans for each school </li></ul></ul>
  24. 24. FAFSA on the Web <ul><li>Good reasons to file electronically: </li></ul><ul><ul><li>Built in edits to help prevent errors </li></ul></ul><ul><ul><li>Skip-logic allows students/parents to skip unnecessary questions </li></ul></ul><ul><ul><li>Detailed instructions and “help” for common questions </li></ul></ul><ul><ul><li>Ability to check status and do corrections on-line </li></ul></ul><ul><ul><li>Simplified renewal application process </li></ul></ul><ul><ul><li>Option to use Internal Revenue Service (IRS) data retrieval </li></ul></ul>
  25. 25. IRS Data Retrieval <ul><li>While completing FOTW, applicant may submit real-time request to IRS for tax data </li></ul><ul><li>IRS will authenticate taxpayer’s identity </li></ul><ul><li>If match found, IRS sends real-time results to applicant in new window </li></ul><ul><li>Applicant chooses whether or not to transfer data to FOTW </li></ul>
  26. 26. IRS Data Retrieval <ul><li>Available early February 2012 for 2012–13 processing cycle </li></ul><ul><li>Participation is voluntary </li></ul><ul><li>Reduces documents requested by financial aid office </li></ul>
  27. 27. Signatures <ul><li>Required </li></ul><ul><ul><li>Student </li></ul></ul><ul><ul><li>One parent (dependent students) </li></ul></ul><ul><li>Format </li></ul><ul><ul><li>Electronic using PIN </li></ul></ul><ul><ul><li>Signature page </li></ul></ul><ul><ul><li>Paper FAFSA </li></ul></ul>
  28. 28. Student Financial Aid Personal Identification Number (SFA PIN) <ul><li>Web site: www.pin.ed.gov </li></ul><ul><li>Sign FAFSA electronically </li></ul><ul><li>Can get PIN at anytime! </li></ul><ul><li>Not required, but speeds processing </li></ul><ul><li>May be used by students and parents throughout aid process, including subsequent school years </li></ul>
  29. 29. FAFSA Processing Results <ul><li>Central Processing System (CPS) notifies student of FAFSA processing results by: </li></ul><ul><ul><li>Paper Student Aid Report (SAR) if paper FAFSA was filed & student’s e-mail address was not provided </li></ul></ul><ul><ul><li>E-mail notification containing direct link to student’s on-line SAR if student’s e-mail was provided on paper FAFSA or FAFSA on the Web (view SAR at www.fafsa.gov ) </li></ul></ul><ul><ul><li>Student with PIN can view SAR on-line at www.fafsa.gov </li></ul></ul>
  30. 30. FAFSA Processing Results <ul><li>Institutional Student Information Record (ISIR) sent to colleges listed on FAFSA approximately 10-14 days after FAFSA submitted </li></ul><ul><li>College reviews ISIR to determine financial aid package </li></ul><ul><ul><li>May request additional documentation, such as copies of federal tax returns </li></ul></ul>
  31. 31. Student Aid Report (SAR) <ul><li>Sent to the student from the Dept. of Education after FAFSA has been processed </li></ul><ul><li>Summarizes all information reported on FAFSA </li></ul><ul><li>Informs family of the EFC (expected family contribution) </li></ul>
  32. 32. EFC Components
  33. 33. Financial Need Varies Based on Cost <ul><li>Cost of Education = Tuition and fees </li></ul><ul><ul><li>+ Books and Supplies </li></ul></ul><ul><ul><li>+ Room and Board </li></ul></ul><ul><ul><li>+ Personal and Travel </li></ul></ul><ul><ul><li>+ Miscellaneous Expenses </li></ul></ul><ul><ul><li>Cost of Education - EFC (expected family contribution) = Financial Need </li></ul></ul><ul><ul><li>Example #1 ( EFC = $10,000) </li></ul></ul><ul><ul><li>$30,000 - $10,000 = $20,000 </li></ul></ul><ul><ul><li>$19,000 - $10,000 = $ 9,000 </li></ul></ul><ul><ul><li>$12,000 - $10,000 = $ 2,000 </li></ul></ul>
  34. 34. Role of Financial Aid Office <ul><li>Determine aid eligibility using federal formula </li></ul><ul><li>Colleges use EFC to award financial aid </li></ul><ul><li>Packages aid depending on availability of funds </li></ul><ul><li>Sends award notifications including: </li></ul><ul><ul><li>Award amount for each program for which the student is eligible </li></ul></ul>
  35. 35. Financial Aid Award Example <ul><li>Family Size - 4 Students Income - $3,000 Parents Income - $55,000 </li></ul><ul><li># in college - 1 Students Assets - $1,000 Parents Assets - $10,000 </li></ul><ul><li>Cost of Education - Family Contribution = Need </li></ul><ul><li>$30,000 $10,000 $20,000 </li></ul><ul><li>College Scholarship $8,000 </li></ul><ul><li>WI Tuition Grant $2,900 </li></ul><ul><li>College Grant $3,300 </li></ul><ul><li>Stafford Loan $5,500 </li></ul><ul><li>Work Study $2,000 </li></ul><ul><li> Total Aid $21,700 </li></ul>
  36. 36. Financial Aid Timeline <ul><li>October – December </li></ul><ul><ul><li>Complete admissions application </li></ul></ul><ul><ul><li>Complete any other documents from colleges </li></ul></ul><ul><ul><li>Discuss any items with your admissions counselor </li></ul></ul><ul><ul><li>Watch mail for 2012-2013 FAFSA in late December </li></ul></ul><ul><li>January – May </li></ul><ul><ul><li>Complete FAFSA as soon as possible after January 1, 2012 </li></ul></ul><ul><ul><li>Make sure you send the results to the colleges you are looking at using their school code </li></ul></ul><ul><ul><li>Watch mail for your financial aid award approximately 4-6 weeks after you submit your FAFSA </li></ul></ul>
  37. 37. Dependent vs. Independent Students <ul><li>At least 24 years old by Dec. 31 st of award year; </li></ul><ul><li>Graduate or professional student; </li></ul><ul><li>Married; </li></ul><ul><li>Has children or dependents (in which the student provides over 50% of their support); </li></ul><ul><li>Veteran of the U.S. Armed forces or currently serving on active duty </li></ul><ul><li>At age 13 or older, both parents deceased, in foster care or a ward/dependent of the court; </li></ul><ul><li>Emancipated minor (determined by court in state of legal residence) </li></ul><ul><li>In legal guardianship (determined by a court in state of legal residence) </li></ul><ul><li>Homeless </li></ul>
  38. 38. Tips for Applying for Financial Aid <ul><li>Apply as early as possible </li></ul><ul><li>Meet college filing deadline/priority dates </li></ul><ul><li>Find out what forms are required at each institution </li></ul><ul><li>Used completed tax returns </li></ul><ul><li>Read the instructions - don’t assume </li></ul><ul><li>Complete all questions </li></ul><ul><li>Keep a copy of all records </li></ul>
  39. 39. Frequent FAFSA Errors <ul><li>Parent and student social security numbers </li></ul><ul><li>Divorce/remarried parent information </li></ul><ul><li>Income earned by parents/stepparents </li></ul><ul><li>Untaxed Income </li></ul><ul><li>Income Taxes Paid </li></ul><ul><li>Household size & number in college </li></ul><ul><li>Real estate and investment net worth </li></ul><ul><li>Not using real name </li></ul>
  40. 40. CAUTION <ul><li>Avoid Scams </li></ul><ul><ul><li>Don’t pay a fee to file the FAFSA </li></ul></ul><ul><ul><li>First “F” means FREE </li></ul></ul><ul><ul><li>www.fafsa.gov </li></ul></ul><ul><ul><li>(Was www.fafsa.ed.gov) </li></ul></ul><ul><ul><li>Watch the scholarship searches </li></ul></ul><ul><ul><li>Don’t pay a fee </li></ul></ul>
  41. 41. Special Circumstances <ul><li>Cannot report on FAFSA </li></ul><ul><li>Send explanation to Financial Aid Office at each school </li></ul><ul><li>College will review special circumstances </li></ul><ul><ul><li>May have a specific form </li></ul></ul><ul><ul><li>May request additional documentation </li></ul></ul>
  42. 42. Special Circumstances <ul><li>Change in employment status </li></ul><ul><li>Medical expenses not covered by insurance </li></ul><ul><li>Change in parental marital status </li></ul><ul><li>Expenses related to a students disability </li></ul>
  43. 43. Financial Aid Awards <ul><li>Look at the college selection process in terms of 4-5 years: </li></ul><ul><ul><li>Find out what happens to your award in the second, third and fourth year </li></ul></ul><ul><ul><li>Find out cost increases for tuition, room and board for past few years </li></ul></ul><ul><ul><li>Find out what happens if student receives funding from an outside source </li></ul></ul>
  44. 44. Website for information <ul><li>www.studentaid.ed.gov </li></ul>
  45. 45. Federal Student Loans <ul><li>Stafford Loans </li></ul><ul><ul><li>Subsidized Stafford: Must demonstrate “need” </li></ul></ul><ul><ul><li>Unsubsidized Stafford: Not based on “need” </li></ul></ul><ul><ul><li>Undergraduate annual loan limits (Sub/Unsub): </li></ul></ul><ul><ul><ul><li>$5,500 for 1 st year </li></ul></ul></ul><ul><ul><ul><li>$6,500 for 2 nd year </li></ul></ul></ul><ul><ul><ul><li>$7,500 for each remaining </li></ul></ul></ul><ul><ul><li>Fixed interest rate </li></ul></ul><ul><ul><li>6-month grace period </li></ul></ul><ul><ul><li>10 year repayment period </li></ul></ul>
  46. 46. Federal PLUS Loans <ul><li>Loan program for parents of dependent, undergraduate students </li></ul><ul><li>Fixed interest rate </li></ul><ul><li>Repayment begins 60 days after loan is fully disbursed </li></ul><ul><li>Annual loan limit: Cost of Attendance minus all other aid </li></ul>
  47. 47. Alternative/Private Loans <ul><li>Private loans </li></ul><ul><ul><li>Student’s loan </li></ul></ul><ul><li>Co-signers </li></ul><ul><li>Variable or Fixed Interest rates </li></ul><ul><ul><li>Typically based on Prime or T-bill </li></ul></ul><ul><li>Repayment typically after education ends </li></ul>
  48. 48. Questions? Thank You! <ul><li>Dawn Scott </li></ul><ul><li>Director of Financial Aid </li></ul><ul><li>[email_address] </li></ul><ul><li>Carrie Kropp </li></ul><ul><li>Associate Director of Financial Aid </li></ul><ul><li>[email_address] </li></ul>