The Financial Aid Process Paying for College Marla Sweningson Financial Aid Counselor George Fox University

Topics We Will Discuss Tonight What is financial aid? Categories, types and sources of financial aid What is a FAFSA? Expected Family Contribution (EFC) Cost of attendance Ask questions…

To provide access – regardless of income To provide choice – regardless of cost To recruit – desirable students What is Financial Aid? Funds provided from a source other than the family to help pay for college expenses

Types of Financial Aid gift aid self-help aid self-help aid Grants Scholarships Loans Work-Study

Gift Aid: Scholarships Money that does not have to be paid back Awarded on the basis of merit, skill, or unique characteristic Gift Aid: Grants Money that does not have to be paid back Usually awarded on the basis of financial need so FAFSA may be required

Self-help aid: Loans Money that students and parents borrow to help pay college expenses Available from the government and private lenders Repayment usually begins after education is finished Only borrow what is really needed Look at loans as an investment in the future

Allows students to earn money to help pay for educational costs Self-help aid: Work-Study A completed FAFSA is required Funds are limited and available only at participating colleges/universities Priority deadlines may applyA student must earn these fundsCompensation is usually minimum wage

Financial aid comes from a variety of sources. Sources of Financial Aid college ( institutional aid) college ( institutional aid) outside/ private sources outside/ private sources federal government federal government state government state government

Largest source of financial aid Aid awarded primarily on the basis of financial need Must apply each year using the Free Application for Federal Student Aid (FAFSA) Federal Government

Common Federal Aid Programs Federal Pell Grant Federal Supplemental Educational Opportunity Grant Federal Work-Study Federal Perkins Loan Subsidized and Unsubsidized Stafford Loans Federal Teach Grant PLUS Loans

Federal Loan Programs U. S. Department of Education Type Grace Rate Perkins Subsidized5.0% Fixed Up to $5,500 per year 9 Months Stafford ( ) Subsidized4.66% Fixed $3,500 first- year undergraduate 6 Months Unsubsidized4.66% Fixed $2,000 first- year undergraduate 6 Months PLUS (parent loan) Credit-based Unsubsidized 7.21% Fixed Depends on remaining financial need Within first 60 days Amount

Free Application for Federal Student Aid (FAFSA) – January 1 - First date to submit FAFSA Must be renewed every year WHEN Available to H.S. seniors, college students, returning adults U.S. citizens and eligible non-citizens WHO Available in English or Spanish A standard form that collects demographic and financial information about the student and family WHAT Determines eligibility for federal and state financial aid programs Used by colleges and universities to award institutional aid WHY

o Social Security Number o Records of income, such as income earned from work and business, child support paid or received, and any other untaxed income. If available, refer to the W-2 Forms and the Federal Income Tax Return IRS 1040, 1040A, or 1040EZ. o Information about assets, such as savings, certificates of deposit, stock options, bonds, 529 plans and other college savings programs, and investment real estate, business, and farm. o Driver’s license number, if the student has one. o Alien Registration Number, if not a U.S. citizen. o FAFSA on the Web Worksheet – use as an optional “pre-application” checklist What information is needed? Completing the FAFSA

Serves as an electronic signature and provides access to personal records on Federal Student Aid systems Go to PIN is conditional until information is verified with the Social Security Administration (1-3 days) Parents and students need separate PINs to use the FAFSA on the Web New login process to be implemented Spring 2015 Personal Identification Number (PIN) PIN Checklist o Social Security Number o Last Name o First Name o Middle Initial o Date of Birth o Address

Transfers student or parent tax data directly from the IRS to the FAFSA Available in early February  2-3 weeks after filing taxes electronically  8-11 weeks after filing taxes by paper Acceptable method of providing tax data if chosen for FAFSA verification  Other method – obtain Tax Return Transcript from IRS ( Not available for:  Amended tax returns  Tax extensions IRS Data Retrieval Tool

Avoid Common Errors Social Security Number – student and parents Legal name – MUST match name on Social Security card Divorced/married parental information Income earned by parents/stepparents U.S. income taxes paid Household size Number of household members in college Selective Service registration – all males aged

Calculated using data from the FAFSA and a pre-set federal formula Expected Family Contribution What?Why?Where? The amount of money a student and family may reasonably be expected to contribute over the course of an academic year Used to determine a student’s eligibility for most federal and state assistance Shown on the Student Aid Report (SAR), the output document sent to a student after the FAFSA is processed EFC Expected Family Contribution EFC Expected Family Contribution

Tuition & Fees Room & Board Transportation Books & Supplies Miscellaneous Living Expenses Cost of Attendance (COA) + What are the costs? Direct expenses Indirect expenses Direct/Indirect expenses

Cost of Attendance (COA) Cost of Attendance (COA) Expected Family Contribution (EFC) Expected Family Contribution (EFC) Financial Need Financial Need -= How much aid can a student receive? Financial Need

College A Three Examples COA (Cost of Attendance) EFC (Expected Family Contribution) Financial Need $3,000 $5,000 $2,000 $3,000 $25,000 $22, = = $3,000 $50,000 $47,000 - = College B College C

Oregon Opportunity Grant Grant awarded on the basis of financial need Must apply each year using the FAFSA award was $2,000 for full-time, full- year attendance at any eligible Oregon institution Funds are limited so apply early! State of Oregon

Academic Scholarships Other merit-based scholarships (athletic, music, art, leadership, etc.) Endowed scholarships Need-based grants Types of College/Institutional Aid

Office of Student Access and Completion (OSAC) – Feb 15 earlybird deadline – Local community organizations, businesses and churches Employers Internet search Private Sources of Financial Aid Small scholarships add up!

The Financial Aid Process Complete FAFSA (Jan. 1 or after) Receive and review the Student Aid Report Complete verification process (if selected) Receive and review Award Offer Respond to college Complete all pending processes Renew FAFSA every year

Evaluating Financial Aid Packages Biggest is not always best – compare to cost of attendance for each school Renewable vs. non-renewable scholarships Grants vs. loans Terms and conditions of loans Balance work with academic responsibilities What is the out-of-pocket cost?

Helpful Hints Apply early if possible File tax returns early – use the IRS Data Retrieval Tool to download your tax information to the FAFSA You may be asked to submit documentation to the financial aid office for verification purposes Pay attention to deadlines! Supplemental applications or forms may be required Avoid scholarship scams Involve student in the process

Trusted Web Sites fafsa.gov studentaid.ed.gov oregonstudentaid.gov studentloans.gov finaid.org fafsa4caster.ed.gov

Questions?