Most questions I get from readers this time of year refer to financial aid. Once students have completed their admissions applications, families are stunned by the harsh reality: College is expensive. Public colleges range from several thousand to more than $20,000 a year, and private colleges are usually about double the cost of public schools. Most families have not saved enough for four years of college, and many have not saved at all.
Applying for college financial aid is complicated, so I won't even attempt to cover everything in this column. However, with some help from Esther Lopez, associate director of admissions at St. Mary's College of California, I'll provide a primer or dictionary of basic jargon that should help families navigate the maze of applying for aid.
Before you begin, it's important that you read the financial aid page of every college to which your student has applied. Each college requires different aid forms and has specific deadlines. I also recommend that you call the financial aid office if you have any questions.
Here are some terms that you'll see on college financial aid Web sites:
Financial aid: A general term used to refer to all types of money awarded to a student based on financial need. Financial aid can include, grants, loans, work-study and scholarships. Financial aid can be used only to pay for college-related expenses such as tuition, fees, room and board, books and supplies.
FAFSA: Free Application for Federal Student Aid. Completing the online (or paper) FAFSA is the first step toward applying for federal financial aid at any college, public or private. You can begin completing the FAFSA now, even if you haven't filed your 2006 taxes yet. As with all financial aid applications, the sooner you submit them, the better; at many schools money is awarded first come, first served. Note the word "free" in FAFSA. You should never pay for the FAFSA.
CSS profile: In addition to the FAFSA, this application is used by many, but not all, private colleges and universities that award non-federal funds. It is administered by the College Scholarship Service, a division of the College Board. You can complete and submit this application online any time now. Families pay a $5 registration fee and $18 per college to have the information from the application sent to colleges. Fee waivers are available for low-income families.
SAR: Student Aid Report. The Department of Education will send a SAR to the applicant and the colleges the applicant has selected a few weeks after receiving the FAFSA. The SAR will contain a dollar amount (the EFC; see below) that the family is expected to contribute to college expenses each year.
EFC: Expected Family Contribution. This amount is used to determine the student's eligibility for federal financial aid.
Demonstrated need: The difference between the EFC and the real cost of attending college. Some colleges make a commitment to fill the gap between the EFC and demonstrated need; others do not.
Grants and scholarships: The federal government and the individual states have a system of granting or "giving" money to students with financial need, and usually it can be used at either public or private colleges. Scholarships can also be awarded by colleges or outside sources, such as an employer, and can be awarded for achievement, for special talents or based on need. These do not need to be repaid.
Loans: Loans require repayment with interest. Federally funded loans can be made to students or parents and have varied repayment and interest programs. Colleges or private institutions, such as banks, can also make student loans.
Merit aid: Merit scholarships are awarded to students based on academic or other achievement and are designed to entice students to attend the college that awards them. They do not have to be repaid.
Work-study: The federal work-study program is a way for students to earn money to help pay for college expenses. Jobs can be on or off campus, though off-campus jobs are usually related to community service.
For further reading
INTERNET:
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© Joanne Levy-Prewitt
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