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A web-adapted version of the popular parent group presentation that introduces college financial aid processes to families
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An Introduction to Financial Aid
Beth Post-Lundquist, Director of Financial Aid, Skidmore College
Dan Lundquist, Vice President for Enrollment, The Sage Colleges
Navigating College Affordability
Topics We Will DiscussAn Approach to College Affordability
The Financial FitThe Financial Aid Application ProcessTypes of Financial AidHow Financial Aid is Calculated
Net Price Calculators: great family tool!Completing the FAFSA and PROFILEUnderstanding Award LettersAdditional Resources
College AffordabilityEasy? No… Do-able? Yes!
College Is Financial Aid Is
ImportantExpensiveAn Investment
Earning: college graduates earn approximately $1,000,000 more over their lifetime
Security: college degree holders have the lowest unemployment rate, twice as “safe” as high school grads
A Vital Resource At private four-year colleges,
89% of students received an average of $16,265
at public four-year colleges 76% of students received an average of $8,735
A Part of the Answer Families have the primary
responsibility to provide a college education but there is significant assistance available
The Importance of “Fit”With so many college options it is important
to focus on “fit,” or comfort and connection:Academic FitSocial FitFinancial Fit
College is a student’s experience and, usually, a family commitment so balancing these factors, early, can be key to success
Exploration, questioning, and honest conversations help this process
“Right Pricing”: Finding the Financial FitThe Net Price Calculator can help
Ballpark your costHelp shape the potential college list Manage expectations
Target your costPrivate, merit
Find colleges where you are a star Matching academic credentials to colleges’ profiles will
help identify places that will offer non-need-based grants Public, price
Many more affluent families – who might not qualify for need-based aid – consider public universities for their lower cost
Suggested Timeline“Staying Ahead of Deadlines Increases Options”
What is Financial Aid? Funds provided to students and families to help pay for postsecondary educational expenses
Financial Aid
Gift AidGrants or
scholarships NOT PAID BACK
Loan AidBorrowed money paid back with
interest
Work AidMoney earned
as payment for a job
Financial Aid PackagesEach college Financial Aid Office will estimate your
eligibility for Federal, State, and college aid, and they will award the maximum you qualify for
Often a combination of grants/loans/work
Sources of financial aid:
Federal government
States
Colleges
Private sources (explore on your own)
www.fastweb.com; www.collegeboard.org
Government Assistance AvailableANNUAL ELIGIBILITY
NAME SOURCE TYPE MAXIMUM CRITERIA
Pell Federal gift $5,550 EFC < $4,996
TAP State gift $5,000 NYNTI < $80,000
Subsidized loan Federal student loan $3,500 need & ½ time enr
Unsubsidized loan Federal student loan $2,000 ½ time enrollment
PLUS Federal parent loan up to COA clear credit history
"work study" Federal student work generally $2000 need/school policySupplemental Grant Federal gift $4,000 need/school policy
Perkins Federal student loan $4,000 need/school policy
Examples of the types of financial aid available and the eligibility requirements that schools will use to determine whether you qualify
How Financial Need is Calculated
Cost of Attendance
– Family Contribution
= Financial Need
What is the Estimated Family Contribution (EFC)?
Amount family can reasonably be expected to contribute
The EFC has two componentsParent contributionStudent contribution
Calculated using data provided by families from the financial aid application materials by each institutionRecognizing larger responsibilities than an
individual, the parent contribution is a smaller percentage of assets than the student’s
4 yr 4 yr Community Public Private College
Price $ 18,500
$ 58,000
$ 3,500
- Family Contribution
$ 9,000
$ 9,000
$ 9,000
= Financial Need $ 9,500
$ 49,000 0
Public Private Price is $ 18,500 $ 58,000 - Family Contribution $ 9,000 $ 9,000 = Financial Need of $ 9,500 $ 49,000
Student Loan $ 3,500 $ 3,500 Work $ 2,000 $ 2,000 TAP $ 500 $ 500 Grant $ 43,000
Total Aid $ 6,000 $ 49,000
Net Price to the Family $18,000 $14,500 (Net Price = price – grants)
Exploring the Difference Between Price and Cost
Top-line PRICE
Bottom-line COST after financial aid
financial aid award
Public Private Price is $ 18,500 $ 58,000 - Family Contribution $ 9,000 $ 9,000 = Financial Need of $ 9,500 $ 49,000
Student Loan $ 3,500 $ 3,500 Work $ 2,000 $ 2,000 TAP $ 500 $ 500 Grant $ 43,000
Total Aid $ 6,000 $ 49,000
Net Price to the Family $18,000 $14,500 (Net Price = price – grants)
Exploring the Difference Between Price and Cost
Top-line PRICE
Bottom-line COST after financial aid
financial aid award
Public Private Price is $ 18,500 $ 58,000 - Family Contribution $ 9,000 $ 9,000 = Financial Need of $ 9,500 $ 49,000
Student Loan $ 3,500 $ 3,500 Work $ 2,000 $ 2,000 TAP $ 500 $ 500 Grant $ 43,000
Total Aid $ 6,000 $ 49,000
Net Price to the Family $18,000 $14,500 (Net Price = price – grants)
Exploring the Difference Between Price and Cost
Top-line PRICE
Bottom-line COST after financial aid
financial aid award
PRICE
COST
Packaging CaveatsWe have chosen a typical New York public university, and it
assumes they do not offer need-based grants (as was true when Beth was financial aid director at UAlbany)
The private college example assumes the college meets 100% of need… not all do, nor is there any requirement that they do
In both cases the yellow box (institutional grant and scholarship) is there to draw attention to the variability of individual institutions’ policies on need- and non-need-based gift aid
After reviewing this illustration, we strongly suggest you “test drive” the Net Price Calculator at comparison colleges your child is interested in, that will give you the best insight into affordability or “Financial Fit”
Net Price CalculatorsAll colleges that use Federal aid have a web-based Net
Price calculator designed to give you an early estimated financial aid award amountEstimates grants and scholarships for you It may or may not include student loans and student
employment opportunitiesLets you get an idea of affordability before even
applying for admissionSearch for Net Price Calculator on each college’s website
You may need to first calculate your Family Contribution, do so at www.collegeboard.org and then enter EFC calculator into the search box
This tool is a great help in exploring Financial Fit early
How and When to ApplyFAFSA – Free Application for Federal Student
Aid www.fafsa.ed.gov
Profile – College Board https://profileonline.collegeboard.com/prf/index.jsp
(or search on College Board website “Profile”)
Apply early = Deadlines FAFSA – after January 1st, before earliest deadline Profile – generally late fall
The Free Application for Federal Student Aid (FAFSA)
A standard form that collects demographic and financial information about the student and family
May be filed electronically or using paper formAvailable in English and Spanish
Parent and student get PINs: www.pin.ed.gov
File online: www.fafsa.ed.gov January 1, 2013 becomes available for new
year
New York State Grants: TAPGood for NYS residents at NYS colleges Link to the TAP Application from the FAFSA
New York State (NYS) Residents attending NYS schools will have the option to link directly to the TAP application from the FAFSA submission confirmation page.
If you exited the FAFSA before selecting this option, you can complete the application after HESC receives your FAFSA data (three days). HESC will send you an email or postcard notifying you to complete the TAP application online if you did not select the FAFSA link to TAP on the Web.
http://www.hesc.com/Content.nsf/ca/Apply_for_TAP_NowFor more details and direct links
FAFSA Tips1. It is the STUDENT’S application, though a parent may be completing it, so…
Don’t use parent social security # when it prompts you to enter “your social security number”
Don’t use parent marital status when it prompts you to enter “your marital status”
2. Database matches are completed against other Federal agencies to check for accuracy.
Social Security administration for name + social security number match
Homeland Security for citizenship statusSelective Service for registration status (if the student
does not indicate they are female)
FAFSA Tips continued
3. Divorced/separated/remarried families Use the parent’s info that the student lived with
most in past 12 months Only one parent’s info reported UNLESS remarried
4. Assets: report value at time of form completion
Do not include assets in Retirement Plans Do not include value of home on FAFSA 529 plans are reported in parent’s name regardless
if owned by student and/or parent UGMA accounts are reported in student’s name
Special CircumstancesNo space to report on FAFSA
Employment/income changes
Health expenses, etc.
Send explanation to financial aid office at each college
College will review special circumstancesRequest additional documentationThese decisions are final and cannot be
appealed to U.S. Department of Education
Completing CSS Financial Aid PROFILEwww.collegeboard.org
Some private colleges require the Profile: check the CSS list (at collegeboard.org) or college’s websitesThree years of income data instead of oneParent assets will include the family home,
farm and small businessSome expense questions not on FAFSASome colleges will have specific, customized
supplemental questions There is a section available to provide special
circumstances information on the Profile
Award Decisions and NotificationsFinancial aid awards are sent with or shortly after the
admission decisionKeep an eye out: it might be online or “hidden” in all
the mail that arrives from colleges!Read all information carefully
Respond within 2 weeks if Early Decision applicant
Respond by May 1st if Regular Decision applicant
Compare offers: remember “Financial Fit”
Uncertain? Contact the Financial Aid office. The process to ask for more assistance is called an appeal. We are here to help.
SUMMARY1) File the FAFSA during January (Check if Profile
application is also required by college)2) Pay Attention to Requests for Additional
Information from Colleges3) Expect to Receive the Admission & Financial Aid
Decisions Near the End of March from Colleges 4) Contact the Financial Aid Office if the Student
Is Admitted BUT You Feel it Is Unaffordable5) Encourage Your Son/Daughter to Apply to a
Variety of Types of Colleges (strive for best Academic & Social & Financial Fit)
Contact us:• Beth at [email protected]• Dan at [email protected]
