Paying for College Scholarships and the Federal and State Aid Process
Begin with the End in Mind • Scholarships • Cost of Attendance • The FAFSA • Federal Aid • State Aid • Tips and Tricks
Scholarships • Institutional (Academic & Endowed) • Pay attention to dates and deadlines! • Academic = Awarded at Admission • Endowed = Apply Annually • Local/Community • Fewer Applicants = Better Odds! • State • Think about participation and action • National • Get specific and pay attention • Use a service/search (see “Other Programs” slide!)
Calculating Cost Direct Cost vs. Cost of Attendance $6,183 Tuition (Out of State $11,718) 1,002 General Fees 259 Textbook Rental 7,530 Room and Board 150 Residence Hall Fees ⁺ $15,124 Estimated Direct Cost (Out of State $20,659) 6,000 Transportation, Supplies, and Personal Allowance ⁺ $21,124 Cost of Attendance/Financial Aid Budget (Out of State $26,659 with $6,000 Transportation, Supplies, Personal Allowance)
The Need Formula Cost of Attendance EFC (Expected Family Contribution) Financial Need
The FAFSA The Free Application for Federal Student Aid fafsa.ed.gov Establish your FSA ID (est. 2015) 1. Unique Identifier: one for parent and one for student a. File online 2. File every year 3. File the first time as soon as possible after October 1 4. of your senior year of high school – Earlier date started in 2017-2018 Determines EFC, therefore aid 6. Now? FAFSA4CASTER 7.
Information You Need to Complete the FAFSA • Student and parent(s) Social Security Number. • Student driver’s license number (if they have one) • Student Alien Registration Number (if not a U.S. citizen) • 2016 federal tax information or tax returns (including IRS W-2 information) for student and parent(s). • If you have not yet filed a 2016 income tax return, you are encouraged to submit your FAFSA by the school’s deadline; you will be asked to provide income and tax information.
Information You Need to Complete the FAFSA...continued • Records of untaxed income like child support, interest income, veteran’s benefits • Information on cash, savings, investments, and business and farm assets for yourself and your parent(s) if you are providing parental information.
Do you have to provide parental information? Are you married? • Are you over 24? • Are you an emancipated minor? • Have you been in foster care (anytime after the age of • 13)? Are you an active duty service member or a veteran? • Are you providing the majority of support for a • dependent child? Are you working on a Masters or Doctoral degree? • If you answered NO to all of the above: • -You ARE required to use parental information!
Who Completes the Parent Section? Answer the questions as of the date you will complete and sign your FAFSA. If your parents are married (or unmarried but live together), provide information about 1. both parents. If your parent is widowed or single, provide information about that parent. 2. If your parents have divorced or separated, provide information about the parent that you 3. lived with most during the last 12 months. If you did not live with one parent more than the other, provide information about • the parent who provided most of your support during the last 12 months. If your parent has remarried after being widowed or divorced, provide information about 4. both your parent and your stepparent. If you have a legal guardian, you cannot use your legal guardian’s information on your 5. application. A legal guardian is not considered a parent in the financial aid process. If you have foster parents, you cannot use your foster parents’ information on your 6. application. A foster parent is not considered a parent in the financial aid process. If you were adopted, follow the instructions above for parents, based on your 7. adoptive parents’ current marital status. The following people are not considered parents on 8. this form unless they have legally adopted you: grandparents, foster parents, legal guardians, older brothers or sisters, and uncles or aunts.
Changes to FAFSA Information If available, use the IRS Data Retrieval Tool when completing the FAFSA. • Verification is a federal and/or institutional requirement • If selected • Submit all materials requested • Tax Transcript from the IRS or IRS Data Retrieval tool • Complete verification at each institution requesting information • You cannot receive any state or federal financial aid until verification is • completed. Special Circumstances and Independent Status • Changes in family situations not reflected when FAFSA was completed • Process is individual to each institution • Contact schools as soon as possible • Documentation is required • Provide as much detail as possible •
Federal Aid • Grants – PELL • Range from $606 to $5920 (for 2017-2018) • 12 semester max – Federal Supplemental Educational Opportunity Grant (FSEOG) • Vary by institution. Southeast’s is ~$1,000 • Must file by priority processing deadline of February 1 • Work-Study – Max award varies by institution and grade level – Declining means you cannot work on campus – Must file by priority processing deadline of February 1
Federal Aid Grade Level Dependent Student Loan Limit Independent Student Loan Limit $5,500 $9,500 Freshman (0-29 hours) (no more than $3,500 subsidized) (no more than $3,500 subsidized) $6,500 $10,500 Sophomore (30-59 hours) (no more than $4,500 subsidized) (no more than $4,500 subsidized) $7,500 $12,500 Junior/Senior (60+ hours) (no more than $5,500 subsidized) (no more than $5,500 subsidized) $31,000 $57,500 Aggregate (no more than $23,000 subsidized) (no more than $23,000 subsidized) (overall total amount you may borrow) Direct Loans (Department of Education is the lender) – Interest rate determined annually • 4.45% interest rate (July 1, 2017-June 30, 2018) – Subsidized (Need-Based) • Interest does not accrue during certain periods – Direct Unsubsidized (Not Need-Based) • Interest does accrue – 6 month “grace period”
Federal Aid • Loans – PLUS (Parent) • Application process varies by school • Based on credit check and approval – Failed credit approval may allow additional unsubsidized loan for student • Interest does accrue during all periods, no grace period • May or may not be included in school’s award letter • Interest rate set annually – 7.0% interest rate (July 1, 2017-June 30, 2018 • Loan Advice – Know the types & compare rates – Only borrow what you need
Total Amount Minimum Total Minimum Annual Minimum Hourly Borrowed Payment Interest Paid Salary Needed Salary Needed $58 $4.15 $5,000 $1,905 $8,631 $86 $6.22 $7,500 $2,858 $12,947 $115 $8.30 $10,000 $3,810 $17,262 $144 $10.37 $12,500 $4,762 $21,578 $173 $12.45 $15,000 $5,714 $25,893 $201 $14.52 $17,500 $6,667 $30,209 $230 $16.60 $20,000 $7,620 $34,524 $288 $20.75 $25,000 $9,524 $43,155 $345 $24.90 $30,000 $11,429 $51,786 $403 $29.05 $35,000 $13,334 $60,417 $489 $35.27 $42,500 $16,191 $73,364 $662 $47.72 $57,500 $21,906 $99,257 $748 $53.94 $65,000 $24,763 $112,203 $72,500 $834 $27,620 $125,150 $60.17 *Based on a 6.8% annual interest rate and equal monthly payments. Minimum salaries are based on the 8% recommendation: Student loan payments should not exceed 8 percent of your gross income. Figures are rounded to the nearest dollar. *All figures assume student is paying interest charges on any unsubsidized loans and not capitalizing the interest while in school. Source: http://www.dhe.mo.gov/studentloanrepaymentchart.html
State Aid (Missouri) • Access Missouri • Grant Aid • Public 2-yr - $300 to $1,300 • Public 4-yr - $1,500 -$2,850 • Private- $1,500 -$2,850 • Full-time enrollment; file by February 1; meet and maintain Satisfactory Academic Progress • Missouri Bright Flight (Missouri Higher Education Academic Scholarship Program) • Top 3%- up to $3,000 • ~31 or above, 800 Reading AND 800 Math • Satisfactory Academic Progress for renewal • Missouri A+ Financial Incentive (participating high schools only) • Graduate from designated high school • Attend a public community college or career/technical school • Pays after all other non-loan financial aid • Ask about “recognition” awards • Other programs: dhe.mo.gov
Other Programs Publication 970: Tax Benefits for Education The American Opportunity Credit 1. Lifetime Learning Credit 2. Coverdell Education Savings Accounts 3. MOST- Missouri’s 529 Plan (Qualified Tuition Programs) 4. Student Loan Interest Deduction 5. Early IRA Deductions 6. Benefits for Military Families 7. Employer Assistance Programs 8. Educational Savings Bonds 9. Scholarship Searches: Department of Labor’s Scholarship Search: careerinfonet.org/scholarshipsearch/ • CollegeBoard.com • CollegeNet.com • FastWeb.com • Scholarships.com • Zinch.com • Chegg.com •
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