1. A College Education Is Affordable

2. Overview  Need-based financial aid  Merit-based scholarships  Alternative financing  An insider’s list of consumer tips

3.  Primary responsibility to pay falls to the family  Families contribute to the extent they’re able  Income and assets reflect financial strength  Similar treatment for similar circumstances  Expect more from those with greater resources  Unusual family circumstances considered

4.  Make education equally accessible to students  Enable student to apply to first-choice college  Attend college based on best fit

5. How do students apply for need- based financial aid?  Federal formula ◦ FAFSA (Free Application for Federal Student Aid)  Institutional formula ◦ CSS/Financial Aid PROFILE  At school’s discretion: ◦ Noncustodial Parent PROFILE ◦ Tax returns and W-2 forms ◦ Institutional Application  IRS Data Retrieval Families must reapply annually

6.  The ability to move federal income tax data from the IRS database to the FAFSA  Can move the data at initial application or as an update/correction after FAFSA filed  Can move parent, student or both sets of tax data  Last completed tax year’s return(s) must be on file for IRS to retrieve data  Some tax filing situations cause Data Retrieval to not be usable

7.  New Federal definition: ◦ “Beginning with the 2014-15 FAFSA, dependent students will be required to include on the FAFSA income and other information from the dependent student’s legal parents (biological or adoptive) regardless of the parents’ marital status or gender, if those parents live together.”

8. COST OF EDUCATION - Family contribution - Estimated financial assistance from outside resources. = STUDENT’S FINANCIAL NEED

9.  Tuition and fees  Room and board  Books and supplies  Transportation  Miscellaneous personal expenses

10.  Health insurance  Computer  Special needs  Child care expenses

11.  Students can be self-supporting IF: ◦ They’re 24 years of age ◦ They’re married ◦ They’re pursuing a graduate degree ◦ They’re in the Armed Forces or are a veteran ◦ They have a child and provide more than 50% support ◦ They’re orphaned or are/have been a foster child ◦ They’ve been emancipated by a state court ◦ They have a court-appointed legal guardian ◦ They’re homeless or at risk of being homeless

12.  Parent contribution from income  Parent contribution from assets  Student contribution from income and assets

13. Taxed Income ? Total Income Available Income Portions of income removed from calculation Allowances _ =

14. Savings, Investments, Real Estate, Business value, Home Equity ? Assets Assessment rate Available Assets Portions of Assets Removed from calcualtion Allowances _ x= 3% to 12% ()

15. Available Income Assessment Rate Total Parent Contribution Available Assets + = 22 – 47% () x

16. # in college adjustment 1-? ÷ Total Parent Contribution Parent Contribution per Student =

17. Total income minus any allowances Portion of Student Income Student Contribution Portion of Student Assets +=

18. Parent Contribution Per Student Family Contribution (EFC) Student Contribution +=

19.  Three real Davidson families: ◦ Family A’s income=$135,000 ◦ Family B’s income =$87,000 ◦ Family C’s income = $61,000  All have roughly a $10,000 EFC  How might this occur? ◦ Hint: Remember the EFC formula variables we have just discussed

20.  Funds from sources other than the college/university ◦ Clubs and civic organizations ◦ Churches ◦ Employers ◦ Foundations  Certain types of benefits(military)  Private gift s

21.  Can… ◦ Meet unmet need ◦ Replace loans ◦ Replace student employment  Can’t… ◦ Replace EFC in need-based award

22. Tuition Parent Contribution Costs (variable) EFC Need (variable) Books and Supplies Transportation Room and Board Student Contribution Estimated Financial Assistance from Outside Resources EFA _ _ =

23.  Gift aid  Grants  Scholarships  Self-help aid  Employment  Student loans

24. DavidsonPrivate #1Private #2Public U. Total Cost $57,608$60,500$42,000$25,000 Family Contribution (EFC) $10,000 Financial need $47,608$50,500$32,000$15,000 Merit aid $0 $12,000$0 Need-based grant $45,508$44,500$10,000 Student loan $0$4,000$5,500$3,500 Work Study $2,100$2,000 $1,500 Total aid $47,608$50,500$29,500$15,000 Unmet need $0 $2,500$0 Total paid $10,000 $10,000+loan +interest $12,500+loan +interest $10,000+loan +interest

25.  Institutional merit-based aid  Need not considered  Procedures for being considered vary ◦ Nomination ◦ Scholarship application ◦ Admission application

26.  Awards made by athletics department  Annually renewable  Can be full scholarships ◦ Tuition, fees, room, board, books  Can be partial scholarships ◦ Any amount less than full

27.  Is the scholarship renewable?  If so, what are the requirements for renewal?  Will the scholarship affect need-based aid eligibility?

28.  Post 9/11 GI Bill benefits – transferable to the student  Employer benefits  School awards

29.  Pell Grant  Supplemental Educational Opportunity Grant (SEOG)  Iraq and Afghanistan Service Grant  Teacher Education Assistance for College and Higher Education (TEACH)

30.  Federal Direct Stafford Loans  Federal Direct PLUS Loans  Federal Perkins Loans (at some institutions)  Private education loans  Other

31.  Summer/academic year student employment  529 savings plans, other savings plans  Payment plans

32.  Need-blind vs. need-sensitive  Early Decision/Early Action  Differential/preferential packaging  Deadlines are important  May 1: National Candidate’s Reply Date

33.  Net Price Calculator ◦ Found on individual college websites ◦ Federally mandated ◦ Family enters income and asset data ◦ Net price based on one-year ◦ Calculators differ by institution

34.  Avoid scholarship programs and search services that charge fees  Financial aid consultants?  Bargaining/negotiating?  Know your loan types and terms

35.  Appeal processes  Institutions may choose to consider individual family circumstances at different times throughout year  Might affect a family’s funding options  Might not affect EFC

36.  Income driven process  Net Price Calculator  Components of aid packages  Cost Difference  Reapply annually  Best fit for the student

37.  www.davidson.edu www.davidson.edu  School Web sites  Federal government www.fafsa.ed.gov  The College Board www.collegeboard.org  College Foundation of North Carolina www.CFNC.org  SmartStudent Guide to Financial Aid www.finaid.org  Scholarship Web sites

38. Questions ???

39. Financial Aid 101 A College Education Is Affordable