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So you want to go to college! But college is expensive, what to do? For most students financial aid is a part of the package to make college affordable. In this module of the Affording College Now Seminar, we cover all of the sources of financial aid. A Leader's Guide is available if you would like to present this workshop, just contact us.
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Saunders Learning Group, Newton, KS
Affording College Now Module Four: Financial Aid
From the Author of “College Without Ramen Noodles”
Saunders Learning Group, Newton, KS
4. FINANCIAL AID
1. Why College 2. Cost of College 3. Saving and Investing for college
5. Making College Affordable
Saunders Learning Group, Newton, KS
Paying for College
Past Income • Savings • College Savings plan (429 plans) • Brokerage accounts (investments) • CDs
Present Income • Salary • Payment Plans • Gifts
Financial Aid • Grants • Loans • Work Study • Tax Benefits
Future Income • Loans • Home Equity • Other
Options Might include:
Saunders Learning Group, Newton, KS
Ability to Pay For College
Saunders Learning Group, Newton, KS
Financial Aid Overview For most college students, the difference in being able to attend college or not is financial assistance of some kind, yet 37% of all aid comes in the form of loans that must be paid back with interest.
Source: The College Board, 2013 Trends in Student Aid.
TOTAL AID IN 2012-13 $185.1 BILLION
Saunders Learning Group, Newton, KS
Growth in Student Aid The total amount of aid available to students is increasing at a slower pace than the cost of going to college, but there is often many sources of aid available.
Saunders Learning Group, Newton, KS
Sources of Student Aid Student aid sources include federal loans, grants, work study and tax credits.
Saunders Learning Group, Newton, KS
Reality Check Many families of college aged kids expect more free money for college from grants and scholarships than they are likely to receive.
Saunders Learning Group, Newton, KS
Federal Financial Aid Eligibility The Free Application for Federal Student Aid (FAFSA) is used to determine your Expected Family Contribution (EFC). This is the amount parents and students are expected to pay directly from their income and savings.
Saunders Learning Group, Newton, KS
How Savings Effects Financial Aid
Savings count far less than current income when determining your Expected Family Contribution (EFC) for federal financial aid purposes. Do not saving for college in the name of your child.
A 529 plan in the parent’s name has much less of an impact on financial aid eligibility than custodial accounts.
529 PLAN ADVANTAGE
Saunders Learning Group, Newton, KS
Types of Loans for College
Subsidized Stafford Loans
For undergraduate students with documented financial need. The government pays interest while the student is in college.
Unsubsidized Stafford Loans
For undergraduate and graduate students regardless of financial need. The government does not pay interest while the student is in college.
Parents PLUS For Parents only. Available from a limited number of banks.
Perkins For Students with high need at some colleges
Grad PLUS For graduate students only.
Private Education Loans
For graduate students only.
Saunders Learning Group, Newton, KS
Soaring Loan Debt Student loan debt has sored in recent years, with the average student graduating with $29,000 in loans.
Saunders Learning Group, Newton, KS
Loan Use
• Parent Loan for Undergraduate Students: – Unsubsidized – Dependent students ONLY – Credit check is required – Limits
• College cost – Fin. Aid = PLUS Loan • FAFSA is required
Saunders Learning Group, Newton, KS
Loan Use
ACADEMIC LEVEL INDEPENDENT STUDENT LOAN
LIMITS
DEPENDENT STUDENT LOAN
LIMITS
First Year Undergraduate $2,625.00 $4,000.00
Second Year Undergraduate $3,500.00 $4,000.00
Third Year & Beyond Undergraduate $5,500.00 $5,000.00
AGGREGATE LOAN LIMIT $23,000.00 $46,000.00
Saunders Learning Group, Newton, KS
Paying for Education
• Do you really need a loan? – Emergency Loans for financial aid
recipients • Works like an advance until your
Financial Aid is disbursed • Borrow up to $500, interest free • $2 Processing fee
Saunders Learning Group, Newton, KS
Paying for Education • Estimated Cost of Attendance (Annual)
Living with Parents
Living Away from Home
Fees (full time resident) $3,062.00 $3,062.00 Bks & Suppl. $1,260.00 $1,260.00 Food & Housing $3,240.00 $8,616.00 Transportation $990.00 $990.00 Misc./Personal $2,304.00 $2,304.00 TOTAL $10,856.00 $16,232.00
Saunders Learning Group, Newton, KS
Tax Breaks for College There is some good news, tax credits, tax-deferrals and deductions are still available.
Saunders Learning Group, Newton, KS
Apply for Financial Aid
• Complete FAFSA at www.fafsa.ed.gov
• Needed for: – Scholarships – Grants – Employment Opportunities – Loans
Saunders Learning Group, Newton, KS
Students using Financial Aid
• Apply for Direct Deposit – You will avoid long check pick-up lines in
University Cashiers – You will have quick & safe access to your
money • What’s required?
– Checking/savings account number – Bank routing number
Saunders Learning Group, Newton, KS
Top Ten Tips 1. Start saving for college early 2. Scholarships – Never pay a fee for
scholarship searches, you can do this
3. Know and meet deadlines for financial aid
4. Make sure you get good value , college is an investment
5. Live at home, start at community college
6. Take summer classes, finish in three years
7. Take more classes @ same cost (some colleges)
8. Work part-time 9. Company and Community groups
for scholarships 10. To keep your Scholarship, keep
your grades up.
Web sites: 1. www.fastweb.com
2. www.collegeboard.com
3. www.wiredscholar.com
4. www.finaid.org
5. www.fafsa.ed.gov
6. www.petersons.com
7. www.supercollege.com
Saunders Learning Group, Newton, KS
QUESTIONS?
Saunders Learning Group, Newton, KS
Summary of Book
Book summary: College Without Ramen Noodles; A Guide to Affording College. This highly readable guide provides college students and their parents with dozens of ways to make college a reality. In fact, use enough of these tips, and you may keep college debt at zero. Author Floyd Saunders has spent the last 20 years helping his five kids get post-secondary education using many of the options highlighted in this book. Mr. Saunders even tells you some good reasons why you might be better off with an alternative to a college degree. Regardless of your circumstances, this book offers valuable information as you consider going to college
College Without Ramen Noodles A simple plan to Affording College By Floyd Saunders Available for all eBook readers
ISBN: 13: 978-0-9824019-2-7
Saunders Learning Group, Newton, KS
Author Contact email: [email protected]
Blog: www/floydsaunders.com
Twitter @floydsaunders
Sideshare: http://www.slideshare.net/FloydSaunders
About the Author • Floyd Saunders is a writer with an extensive
background in the financial services industry, having worked across the industry in retail, commercial, investment banking, insurance, tax preparation and financial planning.
• He has taught personal financial courses for Baker University and has taught extensively for the American Institute of Banking. He has also taught at St. Mary’s College, Lake Tahoe Community College and Mt. Diablo College.
• He is the author of: Figuring Out Wall Street, College Without Ramen Noodles, Banking on Mutual Funds and Annuities, Introduction to Securities Markets, Investing in Securities and Family Financial Freedom.
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