1 Financial Aid for College

Financial Aid Presentation Project, NCASFAA/NCSEAA 2 Scope of this Workshop What is financial aid College costs How to apply Determination of eligibility Need-based programs Alternatives

Financial Aid Presentation Project, NCASFAA/NCSEAA 3 Types of Student Financial Aid Grants Scholarships Loans Employment

Financial Aid Presentation Project, NCASFAA/NCSEAA 4 Student Financial Aid Merit-based  academics  talent  athletic  others Need-based  financial considerations

Financial Aid Presentation Project, NCASFAA/NCSEAA 5 Student Financial Aid Need-based aid ……. Family is responsible for costs to the extent of its ability to pay college costs Provides access and choice Annual determination of eligibility

Financial Aid Presentation Project, NCASFAA/NCSEAA 6 College Costs Direct Indirect Vary widely from college to college

Financial Aid Presentation Project, NCASFAA/NCSEAA 7 Direct College Costs Tuition Required fees Room Meals Books and Supplies

Financial Aid Presentation Project, NCASFAA/NCSEAA 8 Indirect College Costs Transportation and miscellaneous personal expenses, including documented costs for a personal computer Loan fees

Financial Aid Presentation Project, NCASFAA/NCSEAA 9 Indirect College Costs Study abroad costs Dependent care expenses Disability-related expenses Cooperative education program costs

Financial Aid Presentation Project, NCASFAA/NCSEAA 10 Applying for Federal Financial Aid Free Application for Federal Student Aid (FAFSA)  Required for all types of federal aid  Use the worksheets available from high schools & financial aid offices to complete the online form.  96% of forms are filed online!  Paper forms can be obtained by calling FED-AID ( )  Complete on the Web at after January 1st, preceding the academic year  Results sent electronically to institutions listed by student on FAFSA and to the student (if you provide your address)

Financial Aid Presentation Project, NCASFAA/NCSEAA 11 Applying for State Financial Aid The FAFSA is the application for most major state programs:  NC Education Lottery Scholarship  UNC Need-Based Scholarship  NC Community College Scholarship  NC Student Incentive Grant  EARN (new for )  And others Other state programs require additional forms. See CFNC.org for details by program.

Financial Aid Presentation Project, NCASFAA/NCSEAA 12 Applying for Financial Aid Other forms ???  Institutional application  College Scholarship Service PROFILE  State applications  Outside scholarship applications

Financial Aid Presentation Project, NCASFAA/NCSEAA 13 Need Help? FAFSA Day 2008 Saturday, February 9, 2008  Any time between 9 a.m. and noon at all locations except Charlotte Get FREE help completing your FAFSA online from college financial aid officers. Check CFNC.org/fafsaday or school counselor for closest location. Register toll-free, CFNC or online at CFNC.org/fafsaday Sponsored by College Foundation of North Carolina and the North Carolina Association of Student Financial Aid Administrators.

Financial Aid Presentation Project, NCASFAA/NCSEAA 14 Offers to help find aid are everywhere: In the mail Over the Internet In newspapers In magazines Over the phone

Financial Aid Presentation Project, NCASFAA/NCSEAA 15 Offers may be: Legitimate offers of information and assistance  Example: CFNC.org and FAFSA Day Misleading offers from individuals or companies trying to make money off of unsuspecting parents and students

Financial Aid Presentation Project, NCASFAA/NCSEAA 16 How do you identify offers that should be avoided? Organizations that say they can help you locate more aid and then charge you a fee Anyone who charges you a fee for information about financial aid If they charge you a fee to apply for federal financial aid (FAFSA) If they charge a fee to receive financial aid

Financial Aid Presentation Project, NCASFAA/NCSEAA 17 Potential “Scams” “The scholarship is guaranteed or your money back.” No one can guarantee your scholarship before it is awarded. “You can’t get this information anywhere else.” Everyone has access to the same information.

Financial Aid Presentation Project, NCASFAA/NCSEAA 18 Other Misleading Offers “The scholarship requires a small fee.” Never pay a fee to get a scholarship. “You are a finalist” for an award you never applied for. If you did not apply, it is not a legitimate offer. “Come to our free seminar and we’ll show you how to get more financial aid.” This is a sales pitch. Don’t pay for information that you can get elsewhere for free.

Financial Aid Presentation Project, NCASFAA/NCSEAA 19 Where can you find free information about financial aid? Contact College Foundation of North Carolina at CFNC.org or toll free at CFNC  Service of the State of North Carolina Talk to the financial aid administrator at the college of choice Ask your high school counselor or visit the local library Apply for federal financial aid at FAFSA.ed.gov

Financial Aid Presentation Project, NCASFAA/NCSEAA 20 Remember ! You should never have to pay: For information about college financial aid To apply for federal financial aid (FAFSA) To receive financial aid for college

Financial Aid Presentation Project, NCASFAA/NCSEAA 21 Applying for Financial Aid Meet earliest deadline of colleges in which you are interested Complete all questions accurately Estimate if necessary to meet early deadlines Don’t wait until you are admitted to file the FAFSA Keep a photocopy of all documents for your records

Financial Aid Presentation Project, NCASFAA/NCSEAA 22 Applying for Financial Aid Additional documentation may be required… for VERIFICATION of information  Tax returns  Untaxed income (Social Security, Child support, Income reported on FAFSA worksheets, other)  Family size  Family members attending college  Other...

Financial Aid Presentation Project, NCASFAA/NCSEAA 23 Determination of Expected Family Contribution Parents’ Contribution + Student’s Contribution _________________________ = Expected Family Contribution (EFC)

Financial Aid Presentation Project, NCASFAA/NCSEAA 24 Determination of Parents’ Contribution Parents’ total income for calendar year (Taxable + Non-taxable) - Federal Tax Paid (not withheld) -State Tax Paid -Social Security Withholding -Living Allowance -Child Support paid by parents -Employment allowance ___________________________________ = Available Parent Income

Financial Aid Presentation Project, NCASFAA/NCSEAA 25 Determination of Parents’ Contribution Total net assets (excluding home equity) -Protection allowance (varies by age of parent) ___________________________ = Net Worth X 12% ____________________ = Amount of assets used in determining EFC

Financial Aid Presentation Project, NCASFAA/NCSEAA 26 Determination of Parents’ Contribution Available Income + Asset Contribution ___________________ = Adjusted Available Income X Percentage ___________________ = Parent Contribution Parent contribution will be divided by the number of family members in college, not including parents.

Financial Aid Presentation Project, NCASFAA/NCSEAA 27 Determination of Student’s Contribution Student’s total income for calendar year (taxable and non-taxable) - Federal tax paid (not amount withheld) - State tax paid - Social Security withholding - Income protection allowance ($3,080) __________________________________ = Student’s Available Income X 50% __________________________________ = Student’s Contribution from Income

Financial Aid Presentation Project, NCASFAA/NCSEAA 28 Determination of Student’s Contribution Total net assets X 20% ________________ = Student’s Contribution from assets

Financial Aid Presentation Project, NCASFAA/NCSEAA 29 Determination of Student’s Contribution Student contribution from income + Student contribution from assets __________________________ = Total Student Contribution

Financial Aid Presentation Project, NCASFAA/NCSEAA 30 Determination of EFC Parents’ contribution +Student’s contribution ______________________ =Expected Family Contribution

Financial Aid Presentation Project, NCASFAA/NCSEAA 31 Basic Formula for Aid Cost of Attendance – Expected Family Contribution __________________________ = Eligibility for Need-Based Funds

Financial Aid Presentation Project, NCASFAA/NCSEAA 32 Potential Institutional Adjustments to EFC for Institutional Funds Establishment of a minimum level of student contribution Use of home equity in determination of net assets Adjustments for medical/dental expenses Adjustments in the losses/depreciation claimed for business/farm operations

Financial Aid Presentation Project, NCASFAA/NCSEAA 33 Special Circumstances Significant change in your family…  Unemployment of a parent  Death in the family  Change in parents’ marital status Notify the financial aid office at your college of these special circumstances. Be prepared to provide documentation of any change, including the financial impact of the change.

Financial Aid Presentation Project, NCASFAA/NCSEAA 34 Sources of Financial Aid Federal Government State Programs Institutional funds Outside agencies

Financial Aid Presentation Project, NCASFAA/NCSEAA 35 Types of Financial Aid Gift Scholarships Grants Self-help Loans Employment

Financial Aid Presentation Project, NCASFAA/NCSEAA 36 Federal Aid Programs Federal Pell Grant Academic Competitiveness Grant National SMART Grant Federal Supplemental Grant Federal Work-Study Federal Perkins Loan Federal Stafford Loan Federal Ford Direct Loan

Financial Aid Presentation Project, NCASFAA/NCSEAA 37 North Carolina Aid Programs (partial listing) NC Student Incentive Grant NC Legislative Tuition Grant NC State Contractual Scholarship NC Community College Grants NC Education Lottery Scholarship Education Access Rewards NC Scholars Fund (EARN) (new ‘08-’09) UNC Need-Based Grants Nurse Scholarships and Loans Teacher Scholarships and Loans

Financial Aid Presentation Project, NCASFAA/NCSEAA 38 Institutional and Outside Aid Institutional Aid  Grants & Scholarships  Loan Programs  Student Employment Outside Agencies  Local organizations  Churches  Civic Groups  Parents’ employers  Veterans Administration  Vocational Rehabilitation Services

Financial Aid Presentation Project, NCASFAA/NCSEAA 39 Is that all there is? Federal Unsubsidized Loans (Stafford or Direct) Federal PLUS Loans for parents of dependent students and for graduate or professional students

Financial Aid Presentation Project, NCASFAA/NCSEAA 40 Is that all there is? Private Alternative Loans for students or parents  Last resort--Always apply for federal loans first! College Payment Plans Outside Scholarships Tax credits--Hope and Lifetime Learning

Financial Aid Presentation Project, NCASFAA/NCSEAA 41 Tax Credits-- Hope Tax Credit  Available for the first two years of college  Applies to tuition and required fees only.  Can claim up to $1650 tax credit---better than a deduction since it comes directly off taxes owed. ─ Can claim 100% of first $1100 expenses and 50% of the next $1100.  Examples: ─ If you paid tuition of $5000 in 2007, you will be able to claim $1650 on the tax return completed in early ─ If you paid tuition of $1100, you will be able to claim only $1100. ─ If you paid tuition of $1800, you can claim $1450 (all of the first $1100, and 1/2 of the remaining $700…which is $350).

Financial Aid Presentation Project, NCASFAA/NCSEAA 42 Tax Credits-- Lifetime Learning Available for all years Can claim for professional development type classes as well as remaining undergraduate years and graduate years of college. Can claim credit for 20% of tuition & fees, up to maximum of $2,000. There are income restrictions on who can claim Lifetime and Hope Tax Credits….consult with your tax advisor!

Financial Aid Presentation Project, NCASFAA/NCSEAA 43 IRS Deductions and Credits for 2007 Certain taxpayers will qualify to take a tax deduction for tuition and fees (even if they don’t itemize). Deductions range up to $4000/year. Families with adjusted gross incomes up to $80,000 (single filers) & $160,000 (joint filers) can claim credit. Cannot claim Hope or Lifetime Learning credit in the same year for same student. Check with tax preparer to see if you qualify!

Financial Aid Presentation Project, NCASFAA/NCSEAA 44 Additional Information College Foundation of North Carolina The Student Guide  Published by US Department of Education Student Financial Aid for North Carolinians  At the CFNC Web site, click on paying for college and then publications. Publications in local libraries

Financial Aid Presentation Project, NCASFAA/NCSEAA 45 Summary Lots of aid available from federal and state governments Get a PIN now! Student and parent must each have a PIN Complete forms by deadlines Use to complete, sign and submit application.

Financial Aid Presentation Project, NCASFAA/NCSEAA 46 Summary Respond promptly to colleges if additional information requested  Tax returns or other information College will notify via , Web or mail of aid eligibility Student should follow the colleges’ instructions to accept or decline aid offered.

47 Questions?