1. Paying for Postsecondary Education

2. Your Presenter Jayeann Harr Higher Education Access Partner PHEAA (Fayette, Greene, Washington and Westmoreland) jharr@pheaa.org

3. What will we discuss?  What is financial Aid  Free Application for Federal Student Aid (FAFSA)  Expected Family Contribution  Types of financial aid  Smart Borrowing

4. Financial Aid 4 2 types of financial aid »Gift Aid »Self help aid 2 ways to award aid »Merit »Need

5. Where Does the $$ Come From?  Federal/ State Government  School/Colleges  Private Scholarship Sources: HS Counselors Clubs and organizations Employers Internet scholarship searches

6. The Free Application for Federal Student Aid (FAFSA) Used to determine student eligibility for: Federal programs State programs School programs 6

7. FAFSA Completion Workshop Date: February 26, 2015 Time: 4:00 PM – 5:00 PM 5:00 PM - 6:00 PM 6:00 PM - 7:00 PM Date: February 26, 2015 Time: 4:00 PM – 5:00 PM 5:00 PM - 6:00 PM 6:00 PM - 7:00 PM

8. When do I complete the FAFSA? Complete the FAFSA as soon as possible after January 1 of the year for which the student is seeking financial aid. Remember to file the FAFSA every year.

10. Know Your Deadlines! Know all of your state and school/college deadlines and file the FAFSA by the earliest deadline.  PA State Grant deadlines – ◦ May 1, 2015 - First Time and Renewal Applicants that plan to enroll in a degree program or a college transferable program at a junior college or other college or university ◦ August 1, 2015 - First Time applicants that plan to enroll in a community college; a business, trade, or technical school; a hospital school of nursing; or a 2-year program that is not transferable to another institution  Know School Deadlines

11. IRS Data Retrieval Tool (DRT) The IRS Data Retrieval Tool allows students and parents to access IRS tax return information needed to complete the FAFSA. Students and parents may transfer the data directly into their FAFSA. IRS Data is available: »After 2 weeks of electronically filing federal tax return »After 8 weeks of filing a paper federal tax return If use estimated income to complete FAFSA, can go back once taxes are filed and use IRS Data Retrieval Tool.

12. Whose Information Goes on the FAFSA?  Biological Parents  Adoptive Parents  Divorced or separated parents (the parent the student lived with the most over the past 12 months. If equal, then the parent who provided more than 50% of student’s support)  Foster parents - no  Legal guardians - no  Anyone else the student is living with - no

13. Information you Need to Complete the FAFSA  Social security numbers  Federal income tax return (1040, 1040A or 1040EZ)  W-2 forms from all employers  Current bank statements (checking and savings)  Current business and farm records  Records of any stocks, bonds and other investments, including 529 accounts  Additional untaxed income tax records may be needed such as: Veteran’s non educational benefits, child support paid/received and workers compensation.  Alien registration or permanent resident card (if not a US citizen)  The FAFSA does not ask about personal debt – credit card debt, car loans, etc. 13

14. Signing the FAFSA 14 Sign with your PIN: (www.pin.ed.gov) Student and Parent

15. FAFSA Confirmation Page Apply for your State Grant From the FAFSA Completion/Confirmation Page Start your state application to apply for Pennsylvania state based financial aid 15

16. Where does my FAFSA go?  The information on your FAFSA and your resulting EFC are sent to the schools/colleges that you listed on the FAFSA and to PHEAA.  You will also receive notification that it has been processed and the your Student Aid Report (SAR) is available.  REMEMBER TO WATCH AND TO RESPOND TO ANY E-MAILS YOU RECEIVE! 16

17. What forms does the school require?  Free Application for Federal Student Aid (FAFSA)  PA State Grant Form (SGF)  CSS PROFILE Form https://profileonline.collegeboard.org  Institutional Application 17

18. Expected Family Contribution (EFC) Expected Family Contribution (EFC) is determined based on your FAFSA information including: - Parent income and assets - Student income and assets - Family size - Number of children in college - Age of the older parent Schools use this number to determine eligibility for financial aid. 18

19. How is the EFC calculated?  Parent contribution + student contribution = EFC  Bulk of EFC comes from income  Asset protection allowance (based on age of older parent, or the parent if single parent household)  Parent asset contribution = roughly 6%  Student income contribution = 50% of amount over $6,310  Student asset contribution = 20% of assets  Parent contribution divided by number of children in college at the same time 19

20. Financial Aid Award Letter  Official notification from school about financial aid, terms, and conditions.  Lists the type and amount of each award to be received  Describes what must be done to accept or reject any award.  Discloses students rights, responsibilities, and academic requirements.

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24. Financial Aid at Three Schools 24 School ASchool BSchool C Cost$15,000$25,000$45,000 EFC$ 3,000 Need$12,000$22,000$42,000 Free Money$ 6,000$ 8,000$18,000 Loans$ 5,500 Work$ 0$ 2,000$ 3,000 Total Aid$11,500$15,500$26,500 Remaining Costs$ 3,500$ 9,500$18,500 Actual Costs$ 9,000$17,000$27,000

25. Financial Aid Programs Federal, State, and School- based

26. Federal Programs Pell Grant ………. Up to $5,730 (2014-15) Campus-based aid – amounts determined by FAO  FSEOG………………… up to $4000  Perkins loan….……….. up to $5500  Federal work-study…… FAO determines For most programs, student must be enrolled at least half-time.

27. PA State Grant  PA State Grant* Full-time, in PA…...….up to $4,011 Part time, in PA………1/2 of the FT award  Out of state: Up to $600 in DC, DE, MA, OH, RI, VT, WV  Amount determined in part by the cost of the school * Must be at least half-time to be eligible

28. Pennsylvania State Grant (PHEAA)  A Pennsylvania State Grant is based on financial need and other requirements  The maximum amount of the grant is determined, in part, by the cost of attendance at the school: Community College $2,134 State University $3,414 State Related $3,670 Private Institution $4,011 28

29. Ready To Succeed Scholarship  Provides scholarships to high achieving students whose annual family income does not exceed $110,000.  Recipients must attend a participating school in Pennsylvania, have at least a 3.25 QPA, and have earned the equivalent of 24 credits.  Maximum award is $2,000 and limited funds are available. 29

30. Other State Programs  State Work-Study - job related to major  Educational Assistance Grant (EAP) – National Guard  Chafee Education and Training Grant – administered by the Department of Public Welfare  Blind or Deaf Beneficiary Grant Postsecondary Educational Gratuity Program (PEGP) Partnerships for Access to Higher Education (PATH) Pennsylvania Targeted Industry Program (PA –TIP) For details, see the PA Student Aid Guide page 20, or visit www.pheaa.org 30

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32. Scholarships  Scholarships are FREE MONEY  Scholarships are awarded by foundations, philanthropists, non-profit organizations, businesses and colleges to help students pay for college  Check with your School Counselor for Local Scholarships!  Fastweb.com is the largest, most accurate and most frequently updated scholarship database. www.fastweb.com  Scholarships are FREE MONEY  Scholarships are awarded by foundations, philanthropists, non-profit organizations, businesses and colleges to help students pay for college  Check with your School Counselor for Local Scholarships!  Fastweb.com is the largest, most accurate and most frequently updated scholarship database. www.fastweb.com 32

33. Determining Affordability  Approach this as though you are buying an EDUCATION and not a school.  Understand that in higher education there is no direct correlation between cost and quality.  Be open minded and diverse in college searches.  Determine how much you, as a family, can afford.

34. Estimate Costs 34

35. Reduce Your Costs  Earn college credits while in high school through AP courses and dual enrollment  Consider options for cutting costs (commute, take summer classes, buy used books, make smart meal plan choices)  2 + 2 Strategy (2 years at a Community College then transfer credits to a 4 year school)  Earn college credits while in high school through AP courses and dual enrollment  Consider options for cutting costs (commute, take summer classes, buy used books, make smart meal plan choices)  2 + 2 Strategy (2 years at a Community College then transfer credits to a 4 year school) 35

36. Federal Loans If you need to borrow… Go with federal loans first!

37. Types of Federal Direct Loans Undergraduate Students  Subsidized  Unsubsidized Graduate students  Unsubsidized  PLUS Loan Parents  PLUS Loan

38. Interest Rates – Student Loans Undergraduate – Subsidized and Unsubsidized:  4.66% for 2014-15  Capped at 8.25% Graduate – Unsubsidized Only:  6.21% for 2014-15  Capped 9.50%

39. Direct Loan Borrowing Limits

40. Additional Eligibility

41. Parent Loan for Undergraduate Students (PLUS) PLUS Loans – Parent & GradPLUS ◦ 7.21% for 2014-15 ◦ Capped at 10.50 % ◦ Up-front fee of 4.204% deducted at disbursement  May borrow up to full cost of education minus financial aid  Credit check is required on this loan  Repayment begins immediately – can defer repayment but are encouraged to pay interest!

42. www.studentloans.gov 42

43. Alternative/Private Education Loans  Nonfederal loans, made by a lender such as a bank, credit union, state agency, or a school.  Student borrows in his or her own name  Based on credit scoring and debt-to-income ratio  Repayment may be deferred until education completed  Fees, interest rates, loan amounts, and repayment provisions vary by lender and are generally higher than federal student loans  Co-signers usually required. Some loan products have a co-signer release option  Compare loans before making choice and read the fine print!

44. MySmartBorrowing.org This interactive tool gives you information you can use to make smart decisions about career choices and paying for college. MySmartBorrowing.org

45. Be A Smart Borrower  Consider every potential free financial aid option before borrowing.  Think about how you’ll repay your debt before you borrow.  Research job availability in your chosen field, before selecting your major.  Research your expected salary in your future career, find an affordable school, and borrow realistically.  Attend a school that is affordable.  If you must borrow, only borrow what you need.

46. Final Thoughts Before we call it a wrap!

47. Key Reminders  Research Careers  Discuss Affordability as a Family  Apply for Scholarships  Use Net Price Calculators  Apply for PIN  File the FAFSA  Meet Deadlines  Follow up 47

48. Resources  pheaa.org  EducationPlanner.org & MySmartBorrowing.org  Youcandealwithit.com  Myfedloan.org  PHEAA toll free: 1-800-692-7392  Federal Student Aid Info Center – 1-800-433-3243  www.fafsa.gov  www.studentaid.gov – general financial aid info  www.studentloans.gov – information on federal loans

49. 49 Questions?