Financial Aid 101

While it is generally considered the responsibility of the family to pay for college, most all students have need for assistance and will receive some type of financial aid upon acceptance to any college or university regardless of a family's economic standing.  The process may seem over-whelming and difficult but a few tips can help ease the tension of organizing documents, completing forms, waiting, choosing and responding.

Every student that wants financial aid must complete a Free Application for Federal Student Aid (FAFSA) online.  Some private or larger public schools may also require the CSS Profile form, which could include school-specific questions.  These applications help schools determine the amount of money that they feel the family can contribute toward costs.  This is called the Expected Family Contribution (EFC), but is not the actual figure to be paid.

Once the FAFSA/CSS Profile is processed, students will receive a confirmation that the information has been disseminated to each school listed on the forms.  Schools will then start to process applications once academic acceptance has been made.  Next, students receive correspondence notifying them of various awards.

There are several types of financial aid that can potentially appear on the Award Letter.  Gift aid includes grants and scholarships that are based on socio-economic status and do not have to be repaid.  Merit-based scholarships consider the student's resume and academic record and, generally, do not have to be repaid.  Federal loans are just that, but are often attractive to students and parents based on low interest rates and no credit checks.  Private loans may be offered but are not advised.

One tip is to request tax documents as soon after the New Year as possible.  They will be needed to accurately complete the applications.  If schools require them completed earlier, use the closest estimates possible and expect adjustments to the awards when the exact figures are used.

After students are notified of awards for each school, they can determine how what they are being offered in financial aid and what their family can actually contribute compares to the actual cost of attending each school.  This will allow each student and family to choose the best fit both academically and financially.