FINANCIAL AID 101 Kristen Isaksen Associate Director of Financial - - PDF document

9/25/2018 1

FINANCIAL AID 101

Kristen Isaksen Associate Director of Financial Aid Monmouth University

• Terms & tools
• Filing the 2019-20 Free Application for Federal

Student Aid (FAFSA) – NEW FAFSA webpage & app

• Types & sources of aid
• Aid programs
• Tips

Topics We’ll Cover

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• Financial aid is

money that helps a student pay for education expenses at a postsecondary school (e.g., college, vocational school, graduate school).

What is Financial Aid? The FAFSA

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Federal Methodology

Federal Methodology is the formula created by Congress to determine the Federal Expected Family Contribution (EFC).

Expected Family Contribution

• Index number that the financial

aid office uses to determine aid eligibility

• Stays the same regardless of

college choice

• The EFC is not:

– The amount of money you will pay – The amount of federal aid you will receive

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Expected Family Contribution

Cost of Attendance

Direct Expenses

• Tuition and fees
• Room and meal plan

(on campus)

Indirect Expenses

• Books and supplies
• Transportation
• Personal expenses

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Definition of Need

Cost of Attendance (COA)

• Expected Family Contribution (EFC)

= NEED

Financial Need Examples

Cost of Attendance $40,000

• EFC

$15,000 = Need $25,000 Cost of Attendance $65,000

• EFC

$15,000 = Need $50,000

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Net Price Calculator

• All institutions have a net price

calculator on their website. – Generally found on the financial aid page. – Complete for each institution in which you are interested. – Provide income information. – Provides you with an estimate of the aid you are eligible for and the net price at that specific institution.

FAFSA4caster

fafsa.gov

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About the FAFSA 2019-20

• File as early as October 1,

2018.

• Prior-Prior-Year format

– Use 2017 income – Some questions, like marital status & assets, are as of the day the FASFA is completed.

• Check with college(s) for

filing deadline.

• Studentaid.gov/resources

File the FAFSA fafsa.gov

• File every year for each student in college

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FAFSA on the Web

General Eligibility Requirements

• Have a high school diploma or equivalent.
• Must be enrolled or accepted for

enrollment in an eligible program of study leading to a degree, certificate, or

• ther recognized credential.
• Must be U.S. citizen or eligible non-

citizen.

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General Eligibility Requirements

• Must have valid Social Security Number

(SSN)

– www.ssa.gov

• Must be registered with Selective Service

(if male and required)

– www.sss.gov

FSA ID fsaid.ed.gov

• Username and password

– Legal signature on the FAFSA – Access to other U.S. Department of Education sites – Student and 1 parent need an FSA ID – Email address and mobile phone number cannot be used with more than one FSA ID

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FSA ID fsaid.ed.gov

• SSN
• Name
• Date of Birth
• Challenge questions
• Email
• Mobile Phone Number

myStudentAid Mobile App

• Android or Apple
• Must have FSA ID
• Save, complete submit

the FAFSA

• IRS DRT available for

19-20

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Completing the FAFSA IRS Data Retrieval Tool (DRT)

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IRS Data Retrieval Tool (DRT) IRS Data Retrieval Tool (DRT)

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• Tips

– Schools and state agencies can view the data – Screening question for IRA/pension rollovers – Joint filers manually enter income earned from work – Do not change the IRS data – Do NOT update the FAFSA to 2018 income!

Data Retrieval Tool (DRT) Signing the FAFSA

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FAFSA Confirmation Page FAFSA and State Aid

• NJ residents remaining in NJ
• The New Jersey Higher Education Student Assistance

Authority (NJHESAA) collects several additional items not specifically requested on the FAFSA.

• FAFSA confirmation page – blue box.

– Start your state application to apply for New Jersey state- based financial aid.

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FAFSA and State Aid

• Earned Income Credit (EIC)

– A tax credit, not your total earned income

• Untaxed Social Security Income
• Driver’s License State/Number (student only)
• SSN, last name, first initial (parents only)

Process

• Free Application for Federal

Student Aid (FAFSA) – Use the DRT

• Complete Institutional forms (if

required)

• Receive Student Aid Report (SAR)
• Receive/Return Award Letter
• Provide Additional Documentation
• Process Student Loans

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Sources of Aid

• Institutional

– Merit – Need

• Federal
• State
• Other

Tax Credits

• American Opportunity Tax Credit
• Lifetime Learning Tax Credit
• Tuition and Fees Deduction
• Student Loan Interest Deduction

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Types of Financial Aid

• Scholarship

– Does not have to be repaid – Awarded on the basis of merit, skill or a unique characteristic

• Grants

– Does not have to be repaid – Usually awarded on the basis of financial need

• Loans

– Money that is borrowed and repaid with interest

• Employment

– Student earns money to help pay educational costs – Paycheck or non-monetary compensation, such as room and board

Grants and Scholarships

• Federal

– Federal Pell Grant – Federal Supplemental Educational Opportunity Grant (SEOG) – Teacher Education Assistance for College and Higher Education (TEACH) Grant – Iraq and Afghanistan Service Grants

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• STATE

– New Jersey Tuition Aid Grant (TAG) – NJSTARS and NJSTARS II – Educational Opportunity Fund (EOF)

www.njgrants.org

Grants and Scholarships More Grants and Scholarships

• Private Sources

– Think local and global – Use the Counseling Office’s Resources – Internet Resources

• www.fastweb.com

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Federal Direct Loans

• Federal Direct Loan Program

– Borrowed by the student – No cosigner, no credit check – Must file the FAFSA – Entrance counseling and master promissory note must be completed

Federal Direct Loans

– Subsidized – Need Based – Interest rate is fixed at 5.05% for 18-19 – No interest accrual during in-school and grace periods – 1.066% origination fee

• $5500 maximum for first-year students with no

more than $3500 in the subsidized loan

– Unsubsidized – Not need based – Interest rate is fixed at 5.05% for 18-19 – Accrues from time

• f disbursement

– 1.066% origination fee

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Supplemental Loans

• Institutional Loans
• Federal Parent PLUS
• New Jersey College

Loans to Assist State Students (NJCLASS)

• Private/Alternative

Loans

Employment

• Federal Work Study
• Institutional Work Programs
• Off-Campus Jobs

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Tuition Payment Plans

• Not a loan

– Enrollment fee

• Make tuition payments in

monthly installments

• Fit payments into your monthly

budget

• Various payment options

Tips

• READ, READ, READ

– All mail/email promptly – All instructions carefully – Review before submitting

• Maintain copies of all documents
• Do not sign your son or daughter’s

name/FSA ID to financial aid documents

• Involve your student
• Consult a financial aid officer

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Questions to ask a Financial Aid Administrator

• Are scholarship and grant awards

renewable? What criteria must be met?

• What are the policies for work-study

positions? Is a job guaranteed?

• How are outside scholarships treated?
• How can I use financial aid to pay for

books?

• Are there any banking options on campus?
• What if there’s been a job loss, loss of

untaxed benefit, or other special circumstance?

Questions

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