P OP Q UIZ 1. What schools are you considering? List your top three options. 2. What majors are you considering? (top 3) 3. What careers are you considering? (top 3) 4. How are you planning on paying for your education?

C OLLEGE COSTS ARE ON THE RISE …

F INANCIAL A ID The Economics of College…

W HAT IS FEDERAL F INANCIAL A ID ? The government offers NEEDS based assistance for college You must demonstrate documented financial need. There are private loans and aid available, this only deals with what’s available FEDERALLY

D IFFERENT T YPES Grants Do NOT need paid back Needs based Federal Pell Grant Maximum $5,550 Federal Work Study Part time work program to earn money while in school Loans They DO need paid back, with INTEREST Different types

D IRECT S TAFFORD L OANS The main loan from the government Advantages Lower interest Flexible repayment options For four year school, community college, trade, career, or technical school Borrow from the US Department of Education Two types…Subsidized and Unsubsidized

D IRECT S UBSIDIZED S TAFFORD L OANS Based on need…school decides how much you get Not charged interest while in school at least half time 6 month grace period after you leave school 3.4% interest rate

D IRECT U NSUBSIDIZED S TAFFORD L OANS Do NOT need to demonstrate financial need School decides how much you get Start collecting interest as soon as you get them Pay the interest while in school, its cheaper If you don’t pay the interest, the interest accrued is added to your principal, increasing the amount that you pay 6.8%

P ARENT PLUS Parents have different types of loans. Often, people under a certain age cannot get loans unless parents sign on as guarantors or take out a parent PLUS loan themselves.

M AX S TAFFORD L OAN A MOUNTS … YearDependent Undergraduate Student (except students whose parents are unable to obtain PLUS Loans)PLUS Loans Independent Undergraduate Student (and dependent students whose parents are unable to obtain PLUS Loans)PLUS Loans Graduate and Professional Degree Student First Year $5,500—No more than $3,500 of this amount may be in subsidized loans. $9,500—No more than $3,500 of this amount may be in subsidized loans. $20,500—No more than $8,500 of this amount may be in subsidized loans. Second Year $6,500—No more than $4,500 of this amount may be in subsidized loans. $10,500—No more than $4,500 of this amount may be in subsidized loans. Third and Beyond (each year) $7,500—No more than $5,500 of this amount may be in subsidized loans. $12,500—No more than $5,500 of this amount may be in subsidized loans. Maximum Total Debt from Stafford Loans When You Graduate (aggregate loan limits) $31,000—No more than $23,000 of this amount may be in subsidized loans. $57,500—No more than $23,000 of this amount may be in subsidized loans. $138,500—No more than $65,500 of this amount may be in subsidized loans. The graduate debt limit includes Stafford Loans received for undergraduate study.

R EPAYING YOUR LOANS ! 6 months before you begin repayment Where do I access my loan information? There are many different repayment plans and options

R EPAYMENT P LANS Standard repayment Fixed amount each month Done in ten years Higher monthly payments Extended repayment Fixed annual repayment over up to 25 years. More than $30,000 in Direct loans to be eligible Lower monthly payment, higher overall payment

R EPAYMENT PLANS Graduated Repayment Start payments low, then increase every two years Good if you think your income will grow over time Income Based Repayment (IBR) Based on income and family size If you repay for 25 years and meet requirements, the balance of your loan could be cancelled

R EPAYMENT P LANS Income Contingent Repayment (ICR) Direct loans only Flexibility to make payments without hardship Every year, calculate new monthly payments Your income, plus spouses, family size, and amount of loan After 25 years in this plan, remaining balance is discharged

I NDEPENDENT S TUDENT An independent student is one of the following: at least 24 years old, married, a graduate or professional student, a veteran, a member of the armed forces, an orphan, a ward of the court, or someone with legal dependents other than a spouse.