1 High School Financial Aid Workshop Brad Barnett, MS, AFC Accredited Financial Counselor Senior Associate Director James Madison University Office of Financial Aid & Scholarships November 17, 2009

2 Consult with Appropriate Stakeholders Talk to Those Involved in This Decision If parents are assisting students with paying for college it is important students take the time to sit and discuss details with them Financial aid is a long-term process How much debt are students willing to accumulate How much debt can parents afford

3 Learn More About Schools Understand the costs of schools Examine the types of schools Learn about individual deadlines of schools Try not to let cost be a large deterrent MANY colleges are willing to work with students

4 Options Personal savings Investments (e.g., 529 plans, ESAs, Mutual Funds, etc.) Payment plans Part-time employment Grants (federal and state) Scholarships (institutional and private) Federal Loans (student and parent) Private Loans (student and parent)

5 Packaging and Available Aid

6 Cost of Attendance Tuition & fees Room & board Books, supplies, transportation, & miscellaneous personal expenses, including documented costs for personal computer Loan fees Study abroad costs Dependent care expenses Disability-related expenses Cooperative education program costs

7 EFC = Expected Family Contribution The federal government determines a familys ability to pay for post- secondary expenses (including living expenses) The figure schools use to determine a students eligibility for need-based aid

8 To extent they are able, parents have primary responsibility to pay for dependent childs education Students also have responsibility to contribute to educational costs Families should be evaluated in their present financial condition Familys estimated ability to pay for educational costs must be evaluated in equitable & consistent manner, recognizing that special circumstances may affect familys ability to pay Principles of Need Analysis

9 Definition of Need Cost of attendance (COA) – Expected family contribution (EFC) = Financial need

10 Financial Aid Sources Four primary sources of financial aid are: Federal State Institutional Private

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12 Major Federal Programs Pell Grant Supplemental Educational Opportunity Grant (SEOG) Academic Competitiveness Grant (ACG) National Science and Mathematics Access to Retain Talent Grant (National SMART Grant) Teach Grant Federal Work Study (FWS) Perkins Loan Stafford & Direct Loans (subsidized/unsubsidized) Parent PLUS Loans

13 Federal Perkins Loan (Might be different in ) Eligible students Undergraduate and graduate students Priority to students who show exceptional need, as defined by school Loan amount varies Maximum annual loan $5,500 - undergraduate students $8,000 - graduate & professional students

14 Federal Perkins Loan (Might be different in ) Interest rate: 5% 9-month grace period Repayment period may be up to 10 years Deferment & cancellation provisions available

15 Stafford & Direct Loans (Might be different in ) Available under: Federal Family Education Loan (FFEL) Program with funds provided by lenders (e.g., banks or credit unions) Federal Direct Student Loan (Direct Loan) Program with funds provided directly by federal government via participating schools School determines loan eligibility & delivers loan proceeds to students Subsidized fixed 4.5% interest rate for loans Unsubsidized fixed 6.8% interest rate

16 Stafford & Direct Loans Subsidized: Must demonstrate need Unsubsidized: Need is not considered Base annual loan limits (combined subsidized & unsubsidized): $5,500 for 1st year undergraduates ($3,500 max sub) $6,500 for 2nd year undergraduates ($4,500 max sub) $7,500 for each remaining undergraduate year ($5,500 max sub) $8,500 for each year of graduate/professional study

17 Stafford & Direct Loans Additional unsubsidized loan eligibility for independent undergraduate, graduate, & dependent students whose parents are unable to borrow Parent PLUS: $4,000 per year for first & second years of undergraduate study $5,000 per year for remaining years of undergraduate study $12,000 per year for graduate & professional students

18 Stafford & Direct Loans: Repayment 6-month grace period Maximum repayment period between 10 & 30 years depending on repayment plan chosen Deferment & cancellation provisions available

19 Parent PLUS (Might be different in ) Parent loan program for parents of dependent undergraduate students Annual loan limit: COA minus other aid Fixed interest rate of 8.5% for FFELP Parent PLUS Loan and 7.9% for Direct Loan Parent PLUS

20 Parent PLUS Repayment begins 60 days after loan is fully disbursed; or Parents can request postponement of payment until 6 months after a student ceases to be enrolled at least half-time; interest may be capitalized

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22 Major State Programs Commonwealth Award Virginia Guaranteed Assistance Program Tuition Assistance Grant Program (private only) College Scholarship Assistance Program Two Year College Transfer Grant

23 Public College & Universities Programs –VGAP –Commonwealth Award –CSAP –Transfer Grant (Community College to 4 Year) Amounts vary at each institution based on funding Generally have FAFSA Priority Filing dates

24 Private Colleges & Universities Program - Tuition Assistance Grant Program Award amounts are based on the number of eligible students and the amount of funds appropriated by the General Assembly Maximum Annual Award to be determined: –The undergraduate award is usually around $3,000 –The graduate award is usually less than $2,000 Application deadline is July 31 st ! Talk to a private college or university for more details.

25 Community College to Four Year College Two Year College Transfer Grant Be a first-time entering freshman no earlier than summer 2007 Be a full-time undergraduate in-state student meeting selective service requirements Have received an Associates degree at a Virginia two-year public institution with a cumulative GPA of 3.0 on a scale of 4.0 for the Associates degree Enroll into a Virginia four-year public or Virginia four-year private nonprofit college or university by the fall following completion of Associates degree Have financial need: defined as a federally calculated EFC of 8,000, or less Maximum annual standard award is $1,000 ($500 per term), with an additional $1,000 ($500 per term) for students enrolled into a degree program in: engineering, mathematics, nursing, teaching, or science Limited to three years or 70 credit hours Maintain college GPA of 3.0 on a 4.0 scale and continue to demonstrate financial need (maximum EFC of 8,000)

26 Other State Aid Higher Education Teacher Assistance Program Foster Care Grant (VCCS only) Virginia War Orphan Education Program Virginia Dept. of Rehabilitative Services Virginia Part-time Tuition Assistance Program And many more

27 More information on State Aid

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29 Institutional Aid Types of Institutional Aid Need-based or merit-based grants Scholarships Loans: Student and Parent loans Work-study Application Process: The Financial Aid Office at each institution can explain what type of aid is available and the application procedures

30 Financial aid from private resources can be the most elusive of all aid programs Available From: Local businesses Civic groups Churches Private benefactors National organizations Employment Where to Look: High school counselors Write, call, or visit businesses, civic groups, churches, etc. Public libraries Internet

31 Private Scholarship Search Free Internet scholarship search engines: FinAid.org – The College Board – FastWeb.com – Scholarship Resource Network Express – GoCollege.com: The Collegiate Websource –

32 Private Scholarship Search Local library resources Local businesses & civic organizations Parents employers

33 Avoid Being Scammed To check legitimacy of scholarship search services or individuals, for information about financial aid scams, & tips to avoid being scammed visit these Web sites: Better Business Bureau: U.S. Department of Education: html Federal Trade Commission:

34 Two Types of Financial Aid Award Notices Preliminary Tentative Estimated Official Final (not an accurate description) Non-preliminary Actual

35 Finally Read each document Keep copies of EVERYTHING Be aware of deadlines File taxes early Watch out for verification Respond to all correspondence START LOOKING NOW!

36 Helpful Websites ources/StudentGuide.pdf dents/english/fafsa.jsp?tab=funding ollege/early/edlite-index.html

37 Questions Brad Barnett, MS, AFC Senior Associate Director James Madison University Office of Financial Aid & Scholarships MSC 3519 Harrisonburg, Virginia (540)