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Costs & Aid for Post-Secondary
Education2013-2014
Academic Year
Karla WeberFinancial Aid Advisor
Office of Student Financial AidUniversity of Wisconsin – [email protected]
Financial Aid Basics
Types of Financial Aid Available
The FAFSA and Application Process
Questions
Tonight’s Discussion
Provide greater access and opportunity for
higher education
Assist a student in paying for higher
education
Narrow the gap between what the family
can pay for and the cost of education
Goals of Financial Aid
* Federal and state
statues and legislation
* Establish unique
eligibility requirements
* Applicable to ALL
schools that receive
funding
Financial Aid Regulations
* To the extent that they are able, parents have the
primary responsibility to pay for their dependent
children’s education.
* Students also have a responsibility to contribute
* Evaluated in their current financial situation
* Ability to pay evaluated in an equitable and consistent
manner
* Recognize that special circumstances can have major
financial implications.
Principles of Need Analysis
Tuition and Fees+ Room and Board+ Transportation+ Books and Supplies+ Miscellaneous Living
Expenses
= Cost of Attendance (COA)
What are the costs?
College/University
Living @ Home
On/Off Campus
UW-Madison $16,395 $23,825
UW-Milwaukee $18,512 $25,712
Madison College $5,346 $12,526
UW Colleges $13,630 $18,590
Edgewood College $32,216
Marquette University
$43,804 $46,424
UM-Twin Cities $24,718
Iowa State $31,030
Northwestern $60,840
2012/13 Estimated Costs of Attendance (approx)
Determined by filing the FREE Application for Federal
Student Aid (FAFSA)
www.fafsa.gov (NOT .com!)
Amount a family can reasonably be expected to
contribute, but not what the family will actually pay to
school
NOT an estimate of “extra” cash available
An index used to calculate eligibility for aid
Stays the same regardless of college/university
Expected Family Contribution (EFC)
Elements of Federal Methodology
A complicated equation established
by Congress
Uses both parent AND student
information (for dependent
students)
Has standard income and asset
protection allowances
Ranges from 0 to 99,999
Incom
e
Taxe
s
Paid
Ass
et
s # in
fa
mily
# in
co
llege
FAFSA
Expected Family Contribution (EFC)
Cost of Attendance (COA)
- Expected Family Contribution (EFC)= Financial Need
Financial Need Determination
School #1
School #2
School #3
Cost of Attendance
$37,390 $18,326 $14,054
Less EFC $6,355 $6,355 $6,355
Need $31,035 $11,971 $7,699
Need Varies
Institutional Methodology
Used by come colleges/universities to award their own
institutional funds
Formula can vary widely
Often requires additional application/forms
May consider income & assets not reported on the FAFSA such
as:
Home Equity
Retirement Accounts
Assets in siblings names
Income of non-custodial parent
* Used by SOME private schools
* The school should notify if required
* Don’t trust the website’s list of participating schools (Ex.
Edgewood)
* Collects data beyond what’s required on FAFSA
* Targets non-federal/state funds, only for institutional dollars
* Supports early estimates/admission - became available October
1st
* Application fee is $25, plus $16 for each additional school it
needs to be sent to
CSS/PROFILE
EFC Range
Amount of Financial Need
Adjusted Gross Income
Other criteria can vary widely
Eligibility Criteria
* US Department of Education
* The federal agency that provides funding in the form of grants, work
study, and loans.
* State
* Administer state scholarships and grants, college savings and prepaid
tuition programs.
* Higher Educational Aids Board (HEAB) manages aid for Wisconsin
* Colleges & Universities
* May offer their own scholarships, grant, and loan programs with each
setting its own requirements
* Availability varies WIDELY between schools
Three Primary Sources
* Pell
* Based on EFC range; this current year 0 – 4,995 (Down from
5,273)
* Award amount varies based on EFC and enrollment status
* Maximum award for 2012/13 - $5,550
* Supplemental Educational Opportunity Grant
* Must be eligible for Pell Grant
* Targeted to students with highest need
* Award amount as well as EFC range varies depending on
college/university
Federal Pell Grant & SEOG
* Wisconsin Higher Education Grant (WHEG)
* UW System, Technical and Tribal Colleges
* Wisconsin Tuition Grant (WTG)
* Independent Colleges & Universities (does NOT include for-profit institutions)
* Academic Excellence Scholarship
* Questions/Issues? [email protected]
* WI Covenant
* Questions/Issues? [email protected]
* Minnesota-Wisconsin Reciprocity – MUST apply
* http://heab.state.wi.gov/reciprocity
Other various program – most require add’l application – see website
* http://heab.state.wi.us
State of WI Funding - HEAB
* Senior Checklist
* A confirmation form signed by student, a parent, and the Primary Contact (School
Counselor/Principal)
* A record of service form
* Two letters of recommendation, if necessary due to a suspension
* Make copies! Certify mail!
* Min award $250, Max award $2,500 for full-time enrollment
* Important Dates
* December 1st – Confirmation forms will be made available
* January 1st – Confirmation process begins
* April 1st – Confirmation/FAFSA deadline!
Wisconsin Covenant
* Colleges/Universities
* Need-based & non-need based: Academic, athletic, music,
or other talent
* Alumni Organizations
* Civic Organizations
* Churches, PTA, Elks, Kiwanis, cultural leagues, etc
* Private businesses
* Wal-mart, Best Buy, Dell, Gates Foundation, etc
* Parents’ and/or students’ employers or labor unions
Scholarships
* FREE internet search engines
* Department of Labor, Employment, and Training
* www.careerinfonet.org/scholarshipsearch
* College Board:
* www.bigfuture.collegeboard.org/scholarship-search
* FastWeb:
* www.fastweb.com
* High School Counselors
* Local library resources
Scholarship Searches
* Federal Work Study (FWS)
* Must show a specified amount of need
* Part-time employment may be on or off campus
(public/private non-profit)
* Receive funds through a regular paycheck
* Earnings do not count towards future aid eligibility
* Institutional Work Programs
* Off campus/summer employment
Employment
Perkins Loan
Priority to students who show “exceptional need” as defined by
the school and the amount received varies
Subsidized – Gov’t. covers interest as long as student is at
least ½ time.
Fixed Interest Rate: 5%
9 month grace period/10 year standard repayment period
Institutional Loans
Vary in availability and eligibility depending on
college/university
Loans
Regardless of income, EVERY student qualifies if they meet the basic
eligibility requirements!
* William D Ford Federal Direct Loan Program (DL)
* Subsidized: MUST demonstrate financial need
* Unsubsidized: Not based on need (EVERY student is eligible – no
matter what!!)
* Annual Loan Limits
* Freshmen - $5,500 total ($3,500 max subsidized)
* Sophomore - $6,500 total ($4,500 max subsidized)
* Junior/Seniors - $7,500 ($5,500 max subsidized)
* Grad Student - $20,500 (as of 12/13 no longer have any sub eligibility)
Federal Direct Loans
* No credit score or co-signer requirements
* Lower/Fixed interest rate
* 2012/13 - 3.4% Subsidized, 6.8% Unsubsidized
* 2013/14 – 6.8% for BOTH Subsidized and Unsubsidized, BUT…
* Origination Fee: 1%
* In-School Deferment: student must maintain at least ½ time enrollment
* 6 month grace period
* Repayment period between 10 & 30 years depending on repayment
plan
* Deferment and cancellation provisions available
Federal Direct Loans - Benefits
* Program for parents of dependent undergrads
* Must pass a basic credit check
* Annual Loan Limit: COA minus other accepted aid
* Fixed interest rate: 7.9%
* Origination Fee: 4%
* 60 day grace period – “opt-in” to in-school
deferment
* Compare to Private/Alternative Loans
Parent Loan for Undergrad Students (PLUS)
Additional unsubsidized loan eligibility for
undergrads whose parent was denied PLUS:
$4,000 per year for 1st and 2nd year students
$5,000 per year for 3rd and 4th year students
PLUS Denials
* Consider ability to make monthly payments when you leave school
* Loan repayment calculators available online
* Choose any participating lender – shop around!
* Compare the differences: Fixed/Variable, co-signer requirements,
min/max amounts, deferment and/or forbearance options, fees,
repayment period, etc
* Borrow only what you need for direct educational expenses and
avoid borrowing for discretionary spending
* ALWAYS check with the Financial Aid Office BEFORE pursuing to
make sure all other options have been exhausted
Borrowing Tips
The Application Process
FAFSAIRS Data Retrieval
Frequent ErrorsCommon Questions/Confusion
Special CircumstancesComparing Offers
* Apply for a PIN – student and one parent
* www.pin.ed.gov – can request at any point either prior to or during FAFSA
* Submit:
* the FREE Application for Federal Student Aid (FAFSA) prior to your school’s
deadline
* www.fafsa.GOV (not .com!!!!)
* Becomes available January 1st for the upcoming academic year
* Must reapply EVERY year!!!
* Any requested/required documents for verification to the school(s)
* Any institutional application materials (if required/requested by your school)
* Finalize school admissions
* Make sure to meet ALL required deadlines!
Application Process Overview
* www.pin.ed.gov Personal Identification Number
* Electronically sign the FAFSA, but can also be used to:
* Make corrections to a completed FAFSA
* Sign-in to the National Student Loan Data System
* Sign promissory notes for student/parent loans (Perkins,
Federal Direct, PLUS)
* The student and at least one parent (if dependent) must
get their own
* The PIN should NEVER be shared
What is the PIN?
Student Demographics
School Selection
Dependency Status
Parent Demographics
Financial Information
Sign & Submit!
Confirmation
FAFSA Steps
* To simplify and reduce the number of errors on the FAFSA
* Request and retrieve income and tax data directly from the IRS
* VOLUNTARY!
* “Should” be available beginning February 3rd
* Can be used:
* After at least 2 weeks of electronic tax filing
* After at least 6 weeks of paper tax filing
* If tool not used or changes made, may request “Tax Return
Transcript”
IRS Data Retrieval Tool
IRS Data Retrieval Tool
3 Possible Responses• You are not eligible to
transfer information• Too soon since taxes
filed – may not be available
• Recommend to try!
Only the student is required to be a U.S. citizen,
permanent resident, or eligible non-citizen to
receive aid
Undocumented students are currently ineligible
for federal and state aid
Students with Deferred Action Status are
also not eligible for financial aid
Citizenship Explained
* Who is considered a parent?
* Two biological parents that are married to each other
* Both parents information will be included on the FAFSA
* Divorced/Separated parents
* Will use information for whichever parent is determined to be the
custodial parent
* Step-parents
* Widowed parent
* Legal adoptive parents
* This DOES NOT include legal guardians, even those that are relatives.
Parents Explained
* Complete FAFSA using the parent with whom the
student lived with more in the past 12 months
* Believe it’s equal? Use the parent who provided
more financial support during the last 12 months
or during the most recent year the student
actually received support
* If the parent has remarried, the step-parent
information MUST be included on the FAFSA
Divorced/Separated Explained
* Investments INCLUDE:
* Real estate (but not the home you live in), trust funds, UGMA/UTMA
accounts, money markets, mutual funds, stocks, bonds, other securities,
installment and land sale contracts, etc
* Qualified educational benefits or education savings accounts – 529 Plans
* Investments DO NOT INCLUDE:
* The home you live in, the value of life insurance, retirement plans
(401k’s), pension funds, annuities, non-education IRAs, Keogh plans, etc.
* Business and/or investment farm assets are excluded IF:
* Related family members own 51% or more of the business AND
* It has less than 100 full-time or equivalent employees
Assets Explained
* A statewide event (31 sites) that offers FREE help to families completing the FAFSA
* 8 scholarships available to those in attendance* 95.7% of families that have attended felt it was worth it!* In and around Madison
* Saturday, February 23rd
* Edgewood College, 1000 Edgewood College Ave
* Sunday, February 24th
* DeForest High School, 815 Jefferson St, DeForest* Madison College (MATC), 3550 Anderson St
www.collegegoalwi.org
College Goal Wisconsin!
* Results are sent electronically:
* To the selected school(s)
* To the student/parent – Student Aid Report (SAR)
* If corrections are necessary, log back in and proceed as instructed
* If FAFSA rejects, student/parent must correct before information will be
released
* Student may be required to verify their FAFSA data and will need to
submit tax forms, but school(s) will request documentation
* Once student has been admitted, a financial aid package will be
prepared
* Contact the school with any special circumstances
After your file the FAFSA…
Have to request from the IRS
Online www.irs.gov
By phone 1-800-908-9946
Complete and submit 4056-T Form
Taxes filed electronically will take about 3 – 4 weeks before
available, paper taxes take about 6 – 8 weeks
It is a FREE document and is usually received in about 7 – 10 day
from request
Some schools may still choose to request even if data retrieval used
Can no longer accept copies of the 1040.
Tax Return Transcript
Cannot report on FAFSA initially
Limited to special and unique family circumstances that
must be documented
Usually adjustments to income due to job loss, high
medical/dental expenses, recent divorce, one-time
income, etc.
Case by case basis
School specific – not transferable
CANNOT consider everything!
Special Circumstances
* Start with tuition, fees, room, and board
* Subtract grant and scholarship offers ONLY
* The difference is your “net cost”
* Always compare the net cost of each school
* Do not subtract work study as a lump
sum – students are paid based on number
of hours worked
* Do not subtract loans – you’ll eventually
be responsible for paying for those
How to Compare Aid Offers
Proceed with Caution!
* NEVER pay a fee to file the FAFSA
* Make sure you’re going directly to
www.fafsa.gov (NOT .com!!!!)
* Don’t hire someone, contact financial aid
office if you need assistance
* College Goal Wisconsin!
* NEVER pay to apply for scholarships
* Lots of FREE scholarship searches
* Contact your nearest financial aid office if
you have questions regarding the legitimacy
of any questionable offer
Overview of the Financial Aid Process
http://youtu.be/kbJ55UWMEFE
FAFSA: Apply for Aid
http://youtu.be/c-23SMf5DyQ
How to Fill Out the FAFSA
http://youtu.be/VRyXfUStHO0
Types of Aid
http://youtu.be/Pn4OECMTh5w
Repayment: What to Expect
http://youtu.be/oJHySMdXjxE
Video Resource Links
Federally mandated
Based on income information and, sometimes, academic information
Will provide at least the following information:
Estimated total price of attendance
Estimated tuition and fees
Estimated room and board
Estimated books and supplies
Estimate other expenses (including personal expenses and
transportation)
Total estimate merit- and need-based grant aid
Estimated net price (cost of attendance minus grant aid)
Net Price Calculators
* Enough financial aid will be offered to cover a family’s
full need.
* All school’s automatically offer “full-ride” merit-based
scholarships to the top achieving applicants
* There is an unending supply of aid – so even if we apply
late, there’ll still be funds available
* Our family’s income is too high to be eligible for any aid
* Student loans are not financial aid
Financial Aid Myths
Save!
Involve your student!!!
Research costs at different schools
Make a schedule/timeline
Look for scholarships
Be realistic
Pay attention
And…ASK QUESTIONS!!!!
So what now?!