1. National Association of Student Financial Aid Administrators Presents … © 2013 NASFAA What You Need to Know About Financial Aid

2. © 2013 NASFAA Slide 2 Topics We Will Discuss Tonight What is financial aid Cost of attendance (COA) Expected Family Contribution (EFC) What is financial need Categories, types, and sources of financial aid Free Application for Federal Student Aid (FAFSA) Special circumstances

3. © 2013 NASFAA Slide 3 What is Financial Aid? Financial aid consists of funds provided to students and families to help pay for postsecondary educational expenses

4. © 2013 NASFAA Slide 4 What is Cost of Attendance (COA) Direct costs Indirect costs Direct and indirect costs combined into cost of attendance Varies widely from college to college

5. © 2013 NASFAA Slide 5 What is the Expected Family Contribution (EFC) Amount family can reasonably be expected to contribute Stays the same regardless of college Two components –Parent contribution –Student contribution Calculated using data from a federal application form and a federal formula

6. © 2013 NASFAA Slide 6 What is Financial Need Cost of Attendance – Expected Family Contribution = Financial Need

7. © 2013 NASFAA Slide 7 Categories of Financial Aid Need-based Non-need-based

8. © 2013 NASFAA Slide 8 Types of Financial Aid Scholarships Grants Loans Employment Gift Aid Self-Help Options

9. © 2013 NASFAA Slide 9 Gift Aid: Scholarships Money that does not have to be paid back Awarded on the basis of merit, skill, or unique characteristic

10. © 2013 NASFAA Slide 10 Gift Aid: Grants Money that does not have to be paid back Usually awarded on the basis of financial need

11. © 2013 NASFAA Slide 11 Self-Help Option: Loans Money students and parents borrow to help pay college expenses Repayment usually begins after education is finished Only borrow what is really needed Look at loans as an investment in the future

12. © 2013 NASFAA Slide 12 Self-Help Option: Employment Allows student to earn money to help pay educational costs A paycheck; or Non-monetary compensation, such as room and board

13. © 2013 NASFAA Slide 13 Sources of Financial Aid Federal government States Private sources Civic organizations and churches Employers

14. © 2013 NASFAA Slide 14 Federal 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)

15. © 2013 NASFAA Slide 15 Common Federal Aid Programs Federal Pell Grant Teacher Education Assistance for College and Higher Education Grant Federal Supplemental Educational Opportunity Grant Federal Perkins Loan Federal Work-Study Subsidized and Unsubsidized Loans PLUS Loans

16. © 2013 NASFAA Slide 16 Federal PELL Grant EFC determines eligibility (EFC must be less than $4,996) Award amount based upon enrollment status and school costs Current minimum award is $602 Current maximum award is $5,550

17. © 2013 NASFAA Slide 17 Federal TEACH Grant Students must be studying to be an elementary or secondary school teacher No financial need is required Maximum grant of $4,000 a year for 4 years of undergraduate work Not every college participates in this program Must sign Agreement to Serve and fulfill service requirements after graduation or grant reverts to an unsubsidized Stafford loan

18. © 2013 NASFAA Slide 18 Federal Loans Federal Stafford Loan (fixed interest rate) -Student is borrower -Subsidized (need based, 6.8%) -Unsubsidized (non-need based, 6.8%) -No credit check or cosigner required -Lender is U.S. Department of Education -Fee is 1% -Loan amount based on grade level Freshman $5,500Sophomore $6,500 Junior/Senior$7,500

19. © 2013 NASFAA Slide 19 Federal Loans Federal PLUS Loan (fixed rate of 7.9%) –For parents of dependent undergraduate students –Repayment is immediate; deferment option available –Non-need based –Must pass credit check –Can borrow COA minus financial aid awarded –Fee of 4% –FAFSA required

20. © 2013 NASFAA Slide 20 Federal Campus Based Aid Federal Work Study Federal Perkins Loan Federal Supplemental Educational Opportunity Grant (SEOG)

21. © 2013 NASFAA Slide 21 States Residency requirements Award aid on the basis of both merit and need Use information from the FAFSA Deadlines vary by state; check paper FAFSA or FAFSA online

22. © 2013 NASFAA Slide 22 PA State Grant Residency requirements (Pennsylvania – 1 year prior to filing date of FAFSA) Pennsylvania Higher Education Assistance Agency (PHEAA) manages PA’s state grant program; www.pheaa.orgwww.pheaa.org Grants awarded on the basis of financial need using information from the FAFSA PA state grant deadline for the FAFSA is May 1 State Grant Form required in addition to FAFSA Maximum of 8 semesters of eligibility; grant amount affected by level of enrollment and cost of school

23. © 2013 NASFAA Slide 23 Private Sources Foundations, businesses, charitable organizations Deadlines and application procedures vary widely Begin researching private aid sources early –www.finaid.orgwww.collegeboard.orgwww.finaid.orgwww.collegeboard.org –www.fastweb.comwww.fastweb.com

24. © 2013 NASFAA Slide 24 Civic Organizations and Churches Research what is available in community To what organizations and churches do student and family belong? Application process usually spring of senior year Small scholarships add up!

25. © 2013 NASFAA Slide 25 Employers Companies may have scholarships available to the children of employees Companies may have educational benefits for their employees

26. © 2013 NASFAA Slide 26 College/University Merit Scholarships Grants Work Programs Complete all forms schools require for financial aid by posted deadlines In addition to FAFSA, CSS Profile or institutional financial aid form may be required

27. © 2013 NASFAA Slide 27 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 form –Available in English and Spanish

28. © 2013 NASFAA Slide 28 FAFSA Information used to calculate the Expected Family Contribution or EFC –The amount of money a student and his or her family may reasonably be expected to contribute towards the cost of the student’s education for an academic year Colleges use EFC to award financial aid

29. © 2013 NASFAA Slide 29 FAFSA May be filed at any time during an academic year, but no earlier than the January 1 st prior to the academic year for which the student requests aid For the 2013–14 academic year, the FAFSA may be filed beginning January 1, 2013 Colleges may set FAFSA filing deadlines

30. © 2013 NASFAA Slide 30 FAFSA on the Web Website: www.fafsa.gov 2013–14 FAFSA on the Web available on January 1, 2013 FAFSA on the Web Worksheet: –Used as “pre-application” worksheet –Questions follow order of FAFSA on the Web

31. © 2013 NASFAA Slide 31 FAFSA on the Web Good reasons to file electronically: Built-in edits to prevent costly errors Skip logic allows student and/or parent to skip unnecessary questions Option to use Internal Revenue Service (IRS) Data Retrieval Tool

32. © 2013 NASFAA Slide 32 FAFSA on the Web Good reasons to file electronically: More timely submission of original application and any necessary corrections More detailed instructions and “help” for common questions Ability to check application status online Simplified application process in the future

33. © 2013 NASFAA Slide 33 IRS Data Retrieval Tool While completing FOTW, applicant may submit real-time request to IRS for tax data IRS will authenticate taxpayer’s identity If match found, IRS sends real-time results to applicant in new window Applicant chooses whether or not to transfer data to FOTW

34. © 2013 NASFAA Slide 34 IRS Data Retrieval Tool Available early February 2013 for 2013–14 processing cycle Participation is voluntary Reduces documents requested by financial aid office

35. © 2013 NASFAA Slide 35 IRS Data Retrieval Tool Some will be unable to use IRS DRT Examples include: –Filed an amended tax return –No SSN was entered –Student or parent married but filed separately

36. © 2013 NASFAA Slide 36 Federal Student Aid Personal Identification Number (FSA PIN) Website: www.pin.ed.gov Sign FAFSA electronically Not required, but speeds processing May be used by students and parents throughout aid process, including subsequent school years

37. © 2013 NASFAA Slide 37 FAFSA on the Web Worksheet 2013–14 FAFSA on the Web Worksheet contains: Instructions Questions that gather basic information on student and parent, if applicable

38. © 2013 NASFAA Slide 38 General Student Information Social Security Number Citizenship status Drug convictions Selective Service registration High School Completion

39. © 2013 NASFAA Slide 39 Student Dependency Status FAFSA asks questions to determine status: If all “No” responses, student is dependent If “Yes” to any question, student is independent

40. © 2013 NASFAA Slide 40 Information About the Parents of Dependent Students Tax, income, and other financial information Dislocated worker status Assets

41. © 2013 NASFAA Slide 41 Information About the Student (and Spouse) Tax, income, and other financial information Dislocated worker status Assets

42. © 2013 NASFAA Slide 42 Additional Information College and housing information

43. © 2013 NASFAA Slide 43 Signatures Required –Student –One parent (dependent students) Format –Electronic using PIN –Signature page –Paper FAFSA

44. © 2013 NASFAA Slide 44 Frequent FAFSA Errors Social Security Numbers Divorced/remarried parental information Income earned by parents/stepparents Untaxed income U.S. income taxes paid Household size Number of household members in college Real estate and investment net worth

45. © 2013 NASFAA Slide 45 FAFSA Processing Results Central Processing System (CPS) notifies student of FAFSA processing results by: Paper Student Aid Report (SAR) if paper FAFSA was filed and student’s email address was not provided SAR Acknowledgement if filed FAFSA on the Web and student’s email address was not provided

46. © 2013 NASFAA Slide 46 FAFSA Processing Results CPS notifies student of FAFSA processing results by: –Email notification containing a direct link to student’s online SAR if student’s email was provided on paper or electronic FAFSA Student with PIN may view SAR online at www.fafsa.gov

47. © 2013 NASFAA Slide 47 FAFSA Processing Results Institutional Student Information Record (ISIR) sent to colleges listed on FAFSA approximately 10 to 14 days after FAFSA submitted College reviews ISIR –May request additional documentation, such as proof that a sibling is enrolled in college

48. © 2013 NASFAA Slide 48 Student Aid Report Review data for accuracy Update estimated information when actual figures are available

49. © 2013 NASFAA Slide 49 Making Corrections If necessary, corrections to FAFSA data may be made by: Using FAFSA on the Web (www.fafsa.gov) if student has a PIN; Updating paper SAR (SAR Information Acknowledgement cannot be used to make corrections); or Submitting documentation to college’s financial aid office

50. © 2013 NASFAA Slide 50 What Next? Students accepted for admission with a FAFSA on file will receive a financial aid award letter from each school Compare award letters paying attention to gift and self-help aid totals Pay attention to the academic year costs listed on the award letter Be sure you are considering the cost of four years of school and not just one when deciding what is affordable Pay attention to what aid is renewable each year and the criteria required Ask what happens when the GPA requirement to renew a merit scholarship is not met Find out the average tuition increase for each school

51. © 2013 NASFAA Slide 51 Special Circumstances Cannot report on FAFSA Send written explanation to financial aid office at each college

52. © 2013 NASFAA Slide 52 Special Circumstances Change in employment status Medical expenses not covered by insurance Change in parent marital status Unusual dependent care expenses Student cannot obtain parent information

53. © 2013 NASFAA Slide 53 Payment Options Tuition payment plans Parent/student income and savings Prepaid tuition or college savings plans Outside scholarships Military benefits PLUS loans (parent is borrower) Private loans (last resort; student is borrower with credit worthy cosigner; lender is a bank)

54. © 2013 NASFAA Slide 54 Questions?? Presented by: Charlene Bedillion Assistant Director of Financial Aid Washington & Jefferson College

55. © 2013 NASFAA Slide 55