Presented By: Erica Shafer Associate Director of Financial Aid - - PowerPoint PPT Presentation

Presented By: Erica Shafer Associate Director of Financial Aid Colorado College

• What Is Financial Aid?
• The Financial Aid Equation

– Cost of Attendance & EFC

• Applying for Financial Aid
• Types of Financial Aid
• Knowledge Application
• Financial Aid Tips
• Useful Online Tools
• Little Known Money Savers
• Q&A

Lesser Known Financial Aid Facts

Financial aid is funding used to cover costs associated with earning a college degree. The primary responsibility for paying for college falls to the family and student with financial aid helping fill the gap. Merit-based aid is awarded by the Admissions Office and is based on a student’s admission application materials including GPA and test score information. Need-based aid is awarded by the Financial Aid Office and is based on a family’s EFC calculations and the school’s cost of attendance. Funding sources include the federal government, state government, and the college itself.

Schools emphasize merit vs. need-based aid differently in their financial aid philosophies. For example, schools with lower admission rates (highly selective) may focus on funding need- based institutional awards instead of merit awards.

Cost of Attendance (COA) Expected Family Contribution (EFC)

• (Minus)

Financial “Need”

• A student’s total financial aid cannot exceed their school’s

COA and the total of their need-based aid cannot exceed the value of their financial need.

• Meeting need = only 60 schools out of 4000 IHE award

students enough need-based aid to cover their “need”. The rest “gap”. We will discuss what options there are to cover the “gap” later in presentation.

A school’s COA serves multiple purposes. It represents both the expenses a student will incur by attending a college or university AND a student’s budget for all financial aid.

• Tuition
• Fees
• Room
• Board
• Loan Fees
• Books & Supplies
• Personal Expenses
• Transportation Costs

Direct Costs + Indirect Costs = COA

Allowable components of a school’s COA is regulated by the federal

• government. Values assigned to those components may be set by

state government or college itself.

COA has a tendency to increase each year – But some schools may lock in their tuition & fee prices for four years.

• What Is Financial Aid?
• The Financial Aid Equation

– Cost of Attendance & EFC

• Applying for Financial Aid
• Types of Financial Aid
• Knowledge Application
• Financial Aid Tips
• Useful Online Tools
• Little Known Money Savers
• Q&A

• FAFSA = Free Application for Federal Financial Aid
• Proprietor – Federal Government
• www.FAFSA.ed.gov
• Fill out using federal income tax information
• Can be completed manually or IRS tax information can be directly

imported into the application using the IRS Data Retrieval Tool

• FAFSA EFC is generally used in the Financial Aid Equation to award

federal and state financial aid based on a student’s need level. Some schools may use it to award need-based institutional financial aid as well.

• Must reapply for federal financial aid every year using the FAFSA
• For dependent students, both student and a parent must digitally sign the

FAFSA using username you create.

• One student per FAFSA
• Most colleges require FAFSA as part of financial aid application

process

• Will allow student to put up to 10 schools at a time on application (can

always go back in and add/remove schools later)

• Prior Prior Year
• Approved PPY legislation allows a family applying for financial aid to use

tax forms filed two years before their student starts college.

• For Example - for the 2021 school year families must use their 2018 tax

information (instead of 2019) to be awarded Federal Financial Aid.

• Eases rush of having to complete prior year taxes (2019 for example)

before Spring for Financial Aid applications

• Allows FAFSA to be made available earlier for students applying as

early decision/early action applicants.

• FAFSA is available October 1st for each new school year
• If PPY information is not reflective of family’s reality on the day they fill
• ut the FAFSA (income, marital status, etc.), contact school

Never miss a deadline! FinAid funding at a lot of schools is limited, so if you don’t turn in needed paperwork, you may miss out.

• EFC calculated based off of:
• AGI
• Taxes Paid
• Number in Household
• Number in College*
• Untaxed Income (tax deferred pensions*, etc.)
• Investments (Do not include the family home)
• If student’s parents are divorced or legally seperated,
• nly custodial parent’s financial information is relevant

to the application.

A student’s tax dependency status does not determine their dependency status for financial aid.

Dependent Student’s Parents’ Household Comprised Of: Data from 1 or 2 Parents Collected? Single legal parent 1 Parent Two legal parents who are married 2 Parents Legal parent and step parent 2 Parents Two legal parents who are unmarried (regardless of gender), or who are of the same sex and are married, as recognized by a State or foreign country. 2 Parents Data Collection Breakdown

Be as accurate as possible with your application answers. You may be selected for an audit process called verification and required to submit supporting documentation for your answers.

• Those

individuals or families that filed amended 2018 tax returns

• r filed a foreign

tax return in 2018 cannot use Data Retrieval

• Individuals

whose marriage status changed since filing their 2018 tax return cannot use DRT.

• Need parent’s

FSA ID info to preform DRT

• Wrong “year’s version”
• Wrong Social Security Numbers or Driver License number
• Incorrect marital status
• Not reporting untaxed income
• Withholding vs. U.S. income taxes paid
• Incorrect number in household and dependent students in college
• Including small business value (<100 employees)
• Forgetting to list the college
• Forgetting to electronically “sign” and submit FAFSA

• CSS Profile = College Scholarship Service Profile
• Proprietor – College Board
• Not free for all applicants. Based on student’s need, can ask for a fee

waiver from school’s financial aid office ($25 first app, $16 per app afterwards)

• https://student.collegeboard.org/css-financial-aid-profile
• Currently available October 1st of each year
• Profile EFC is generally used in the Financial Aid Equation by pr

private ate un unive versiti sities es (and nd a few w pu public ic) ) in add ddition n to F

• FAFS

AFSA to award institutiona nal financial aid based on a student’s need level.

• May have to reapply for institutional aid every year using the CSS Profile
• One student per Profile
• Can always go back in after submitting Profile and add schools but can’t

change application information.

Certain schools only require a family to fill out the Profile once and then guarantee to award their student financial aid based on that one EFC calculation all four years.

• Components of EFC Calculation are customizable for schools
• EFC calculation often based off of:
• AGI
• Taxes Paid
• Number in Household
• Number in College
• Untaxed Income (tax deferred pensions, etc.)
• Investment Information (non-ret

retire rement ment investment holdings)

• i.e. any investment equity not held in a 401k, 403b, etc.
• Business Income & Deductions
• Supplementary Investment information (home equity, other real estate holdings,

business value, family cars, etc)

• If student’s parents are divorced, non-custod

custodial al parent’s informati

• rmation
• n may be

required uired for EFC calculati lation.

• n. (http

ttps:// s://sec secure ure-med media.c ia.college

• llegebo

boar ard.org/m d.org/misc sc/c /css ss- profile file/comp

• mpleting

leting-css ss-pro profil file-for

• r-th

the-nonc noncusto ustodia dial-ho househ usehol

• ld/inde

d/index. x.ht html ml) )

• Because school’s can customize not only the components that make up a family’s

institutional EFC but also how they account for them in the calculation, a family’s institutional EFC can vary from school to school

Garbage In Garbage Out

Also on FAFSA

• What Is Financial Aid?
• The Financial Aid Equation

– Cost of Attendance & EFC

• Applying for Financial Aid
• Types of Financial Aid
• Knowledge Application
• Financial Aid Tips
• Useful Online Tools
• Little Known Money Savers
• Q&A

Grants Scholarships Work-Study Student & Parent Education Loans

Grants

Award Amount (1920) Criteria Guaranteed Application

Pell Grant

$100 - $6195

EFC < $6195 Yes FAFSA SEOG Grant

$100 - $4,000

Financial Need No FAFSA

Federal State

Award Amount (1920) Criteria Guaranteed Application

CSG

$500 - $5000

Financial Need & CO Resident No FAFSA COF

~$77 (Public) or ~$38 (Private) per

Credit Hour

*https://highered.colo rado.gov/Finance/COF /* *No* (depends on private or public school)

FAFSA

Institutional

Award Amount Criteria Guaranteed Application

• Inst. Grant

Varies Financial Need No FAFSA or CSS Profile

Scholarships

Award Amount Criteria Guaranteed Application

Admission Scholarship Varies GPA, Test Scores, Application Essays No Admission Application Departmental Scholarship Varies Major, Scholastic Record, and/or Need No Admission Application or Additional App

Private

Award Amount Criteria Guaranteed Application

Private Scholarship Varies Varies No Varies

Institutional

Outside Scholarships

FastWeb.com Scholarships.com Gocollege.com App: Scholly

Tips for Applying

• Be prepared to answer who, what, when, why, and how for all scholarship essays
• Who: are you as a result of a scholarship-relevant catalyst in your life
• What: was the catalyst for why you became interested in something (hobby, passion,

movement, sport, etc.)

• When: was the moment that catalyst took place
• Why: was that event an important catalyst for you
• How: has that catalyst impacted you
• For every five hundred words you are required to write in an essay, have one catalyst
• 500 word essay: 1 catalyst
• 1000 word essay: 2 catalysts
• 1500 word essay: 3 catalysts, etc.
• Spell-check and proofread!
• Give serious thought not only to your achievements, but lessons you have learned along the way.
• Don’t rebuild your resume in your essay
• Quantity over quality is general a better strategy for ROI

*Special thanks to Tanika Mangum @ UNCF* https://studentaid.ed.gov/sa/types/grants-scholarships/finding-scholarships

Student & Parent Education Loans

Award Amount Criteria Interest Rate (1718) Guaranteed Application Direct Sub

$3500 – Freshmen $4500 – Sophomore $5500 – Junior &

Senior Financial Need

4.53%

(Fixed) No FAFSA Direct Unsub

$2000

None

4.53%

(Fixed) Yes FAFSA Direct Parent Plus COA – Other Aid = amount Approved Credit

7.08%

(Fixed) No FAFSA & Credit App at studentloans.gov

Private

Award Amount Criteria Interest Rate Guaranteed Application Private Loan COA – Other Aid = amount Approved Credit Varies (Variable) No Varies

Federal

Work-Study

Award Amount Criteria Guaranteed Application

Federal WS Varies Financial Need No FAFSA State WS Varies Financial Need No FAFSA

Federal & State

• Student must work at on-campus job or approved off-campus job to earn money
• Wages paid directly to student, not to their bill
• 1-40 hrs. a week
• Flexible
• Can be a very competitive award to receive
• Best spent on paying for indirect costs instead of covering direct costs

• What Is Financial Aid?
• The Financial Aid Equation

– Cost of Attendance & EFC

• Applying for Financial Aid
• Types of Financial Aid
• Knowledge Application
• Financial Aid Tips
• Useful Online Tools
• Little Known Money Savers
• Q&A

Grants Scholarships Work-Study

Subsidized Student Loans Family’s Expected Contribution (calculated by FAFSA & Profile)

Private Students Loans Fed Unsub Students Loans Parent Plus Loan College COA

Need- based aid

Cost of Attendance (COA) Expected Family Contribution (EFC)

• (Minus)

Financial “Need”

Cost of Attendance [$40,000] Expected Family Contribution [$10,000]

• (Minus)

Financial “Need” [$30,000]

If a school meets student “need” than a student would receive $30,000 in need-based aid. If they don’t the family may need to look at financing options, etc. to meet the difference.

Grants Scholarships Work-Study Subsidized Student Loans

Family’s Expected Contribution (calculated by FAFSA & Profile)

Private Students Loans Fed Unsub Students Loans

Parent Plus Loan

College COA = $40,000

Need- based aid eligibility cap = $30,000 = $10,000

*Private Scholarships*

Used to cover Gap

• r help

with family EFC

• What Is Financial Aid?
• The Financial Aid Equation

– Cost of Attendance & EFC

• Applying for Financial Aid
• Types of Financial Aid
• Knowledge Application
• Financial Aid Tips
• Useful Online Tools
• Little Known Money Savers
• Q&A

Home Stretch!!!

• Financial need may affect your admission into certain colleges (Need Blind vs. Need

Aware)

• The policy for packaging students with institutional aid and some federal/state aid is

completely up to each university

• Do not be afraid of a school’s sticker price.
• Use Net Price Calculators! (income fluctuate? Number of undergrad students going to

fluctuate? Try out different scenarios)

• Don’t use your retirement to pay for your child’s college
• Do let schools know about any special family financial circumstances
• Do apply for outside scholarships but find out how school will apply them

to student’s account/financial aid package

• Do let schools know if you plan to utilize VA educational benefits
• Do plan for four years of attendance instead of just one
• Do research application requirements and deadlines
• Do submit forms by deadlines
• Financial aid offer is generally sent with the offer of admission but not always
• Do review the offer and ask questions if needed (award letters will not look

the same)

• Do accept or decline offer by deadline

• Gap Year
• Transferring from Community College
• One Year Masters Programs
• Earning a Degree Abroad
• Researching Schools that Meet Full Need

– https://bigfuture.collegeboard.org/college-search

• Thinking About ROI

– Should not borrow more than you expect to earn your first year out of college

• FAFSA FAQs (FSA ID Information, etc.)

– https://studentaid.ed.gov/sa/fafsa/filling-out/help

• FAFSA Paper Worksheet

– https://studentaid.ed.gov/sa/sites/default/files/2019-20-fafsa-worksheet.pdf

• Federal Student Aid College Preparation Site (career options, budgeting, etc.)

– https://studentaid.ed.gov/sa/prepare-for-college

• CSS Profile 20-21 Participating Institutions

– https://profile.collegeboard.org/profile/ppi/participatingInstitutions.aspx

• Getting Started with CSS Profile

– https://cssprofile.collegeboard.org/getting-started-your-css-profile-application

• 19-20 CSS Profile Question and Instruction Listing

– https://sfs.virginia.edu/sites/sfs.virginia.edu/files/2019- 20%20CSS%20Profile%20Comprehensive%20Question%20and%20Instruction%20Listing.pdf

• CSS Profile Information for Divorced or Separated Parents

– https://cssprofile.collegeboard.org/info-divorced-separated-parents

• Pikes Peak Library District Help

– http://research.ppld.org/c.php?g=889636&p=6426423

• College In Colorado

– https://www.mycoloradojourney.com/journey/tools

• Financial Aid Awareness Calculators

– https://studentloans.gov/myDirectLoan/financialAwarenessCounseling.action?execution=e 1s1

• College Planners

– https://bigfuture.collegeboard.org/?affilliateId=cbhomeexp&bannerId=bf

• Financial Aid Award Comparison Tool

– https://bigfuture.collegeboard.org/pay-for-college/financial-aid-awards/compare-aid- calculator

• Major ROI Research

– http://online.wsj.com/public/resources/documents/paths-to-professions-ROI.html – http://online.wsj.com/public/resources/documents/info-Degrees_that_Pay_you_Back- sort.html

• Grad School ROI

– http://www.forbes.com/sites/laurashin/2014/09/30/is-grad-school-worth-it-7-steps-to- calculating-the-roi/

• Business Mindset Resource

– http://www.wsj.com/public/page/rankings-career-college-majors.html

• Colorado College CO Pledge (*Test optional & no application fee too)

– https://www.coloradocollege.edu/admission/financialaid/net-price-calculator- myintuition/colorado-pledge.html

• What Is Financial Aid?
• The Financial Aid Equation

– Cost of Attendance & EFC

• Applying for Financial Aid
• Types of Financial Aid
• Knowledge Application
• Financial Aid Tips
• Useful Online Tools
• Little Known Money Savers
• Q&A