Financing Higher Education

Financing Higher EducationAshley Bianchi

Director of Financial Aid

Types of Financial Aid

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Scholarships & Grants

funds do not have to be repaid

Loans

funds have to be repaid with interest

Work-Study

funds are earned on an hourly basis and the paycheck goes to the student

Need-based Financial Aid

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Responsibility Parents and students

Financing from Savings, Current Income, Borrowing

Determines Expected Family Contribution (EFC) as determined by the

Free Application for Federal Student Aid (FAFSA)

CSS PROFILE (for institutional grant aid at selective colleges)

Cost of attending college less the EFC = eligibility for grants, loan, work study

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CSS Profile Register for and complete the CSS Profile

online at

https://profileonline.collegeboard.com

Not every college or university will require CSS Profile

Rhodes, Vandy, Emory, Wash. U., W & L, etc.

Check with each college or university to learn deadlines

Some schools will require information from non-custodial parent, via the CSS Profile

Steps to applying for need-based financial aid

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Free Application for Federal Student Aid (FAFSA) Apply between January 1 and March 1

Check deadlines for states and colleges

Preferably after taxes are completed

Apply online at www.fafsa.ed.gov

Get a PIN number (students and parents) from FAFSA web site

Steps to applying for need-based financial aid

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Cost of Attendance (COA)

Tuition, fees, room, board, books, living, and transportation

Less Expected Family Contribution (EFC)

The minimum amount the family is expected to contribute toward the student’s education for that year

Results in the maximum eligibility for aid or “demonstrated need.”

Eligibility Formula

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COA: $46,000

- EFC: $16,000

Max. Aid Eligibility: $30,000

(demonstrated need)

Eligibility Formula Example

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COA: $46,000

EFC: $16,000

Max. Aid Eligibility: $30,000

(demonstrated need)

Scholarships & Grants: $22,500

Work-study: $ 1,600

Perkins Loan: $ 2,000

Subsidized Stafford Loan: $ 3,500

TOTAL: $29,600

Sample Financial Aid Package

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FAFSA must be completed as the application for the lottery scholarship

TN Hope Scholarship - $4,000

TN Lottery Merit Scholarship - $1,000

TN “Aspire” Award (need-based) - $1,500

www.collegepaystn.com

Tennessee Lottery Scholarships

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www.collegeboard.com/student/pay/index.html

www.finaid.org

Helpful Websites

Common Misconceptions

• We make too much money to get financial aid:– There is no income cut-off to qualify for federal student aid.

Many factors besides income—from the size of your family to the age of your older parent—are taken into account. Your eligibility is determined by a complicated mathematical formula, not by your parents’ income alone.

– And remember: when you fill out the Free Application for Federal Student Aid (FAFSA), you’re also automatically applying for funds from your state, and possibly from your school as well. Don’t make assumptions about what you’ll get—fill out the application and find out.

Common Misconceptions

• The FAFSA is too hard to complete, I just don’t understand it: – The FAFSA is easier than ever, especially if you fill it out

online at www.fafsa.ed.gov. There are detailed instructions for every question, and the form walks you through step by step, asking only the questions that apply to you. If you need help, there are many options. There are worksheets available so that you can prepare your documents ahead of time and then it is as simple as filling in the blanks on the electronic form. You may also call the Central Processor’s office toll-free at:1-800-4-FED-AID. And remember, the FAFSA and all these sources of advice are FREE.

Common Misconceptions

• We can afford our state school, but we know that private education is out of reach for us: – Although the sticker price on a private school

might be higher, don’t rule it out just yet. Private colleges often offer more financial aid to attract students from every income level. Higher college expenses also mean a better chance of demonstrating financial need. You may find that you qualify for more financial aid putting public and private schools on a more equal playing field.

Common Misconceptions

• You want me to sell everything I own in order to pay for my child’s education: – A family's share of college costs is calculated

based mostly on income, not assets such as savings or home equity. Although some colleges will consider home equity in calculating for institutional grants, no financial aid office expects parents to sell their home and clean out their retirement for their child’s education.