1 financial aid for college. financial aid presentation project, ncasfaa/ncseaa 2 scope of this...

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Financial Aid for College

Financial Aid Presentation Project,

NCASFAA/NCSEAA 2

Scope of this Workshop

• What is financial aid

• College costs

• How to apply

• Determination of eligibility

• Need-based programs

• Alternatives


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Types of Student Financial Aid

• Grants

• Scholarships

• Loans

• Employment


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Student Financial Aid

• Merit-based academics talent athletic others

• Need-based financial

considerations


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Student Financial Aid

Need-based aid …….

• Family is responsible for costs to the extent of its ability to pay college costs

• Provides access and choice

• Annual determination of eligibility


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College Costs

• Direct

• Indirect

• Vary widely from college to college


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Direct College Costs

• Tuition

• Required fees

• Room

• Meals

• Books and Supplies


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Indirect College Costs

• Transportation and miscellaneous personal expenses, including documented costs for a personal computer

• Loan fees


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Indirect College Costs

• Study abroad costs

• Dependent care expenses

• Disability-related expenses

• Cooperative education program costs


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Applying for Federal Financial Aid

• Free Application for Federal Student Aid (FAFSA) Required for all types of federal aid

Use the worksheets available from high schools & financial aid offices to complete the online form.

96% of forms are filed online!

Paper forms can be obtained by calling 1-800-4-FED-AID (1-800-433-3243)

Complete on the Web at www.fafsa.ed.gov after January 1st, preceding the academic year

Results sent electronically to institutions listed by student on FAFSA and to the student (if you provide your email address)


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Applying for State Financial Aid

• The FAFSA is the application for most major state programs: NC Education Lottery Scholarship UNC Need-Based Scholarship NC Community College

Scholarship NC Student Incentive Grant EARN (new for 2008-2009) And others

• Other state programs require additional forms. See CFNC.org for details by program.


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Applying for Financial Aid

• Other forms ??? Institutional application

College Scholarship Service PROFILE

State applications

Outside scholarship applications


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Need Help?FAFSA Day 2008

• Saturday, February 9, 2008 Any time between 9 a.m. and noon

at all locations except Charlotte

• Get FREE help completing your FAFSA online from college financial aid officers.

• Check CFNC.org/fafsaday or school counselor for closest location.

• Register toll-free, 866-866-CFNC or online at CFNC.org/fafsaday

• Sponsored by College Foundation of North Carolina and the North Carolina Association of Student Financial Aid Administrators.


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Offers to help find aid are everywhere:

• In the mail

• Over the Internet

• In newspapers

• In magazines

• Over the phone


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Offers may be:

• Legitimate offers of information and assistance Example: CFNC.org and FAFSA

Day

• Misleading offers from individuals or companies trying to make money off of unsuspecting parents and students


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How do you identify offers that should be avoided?

• Organizations that say they can help you locate more aid and then charge you a fee

• Anyone who charges you a fee for information about financial aid

• If they charge you a fee to apply for federal financial aid (FAFSA)

• If they charge a fee to receive financial aid


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Potential “Scams”

• “The scholarship is guaranteed or your money back.”

No one can guarantee your scholarship

before it is awarded.

• “You can’t get this information anywhere else.”

Everyone has access to the same information.


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Other Misleading Offers

• “The scholarship requires a small fee.” Never pay a fee to get a scholarship.

• “You are a finalist” for an award you never applied for.

If you did not apply, it is not alegitimate offer.

• “Come to our free seminar and we’ll show you how to get more financial aid.”

This is a sales pitch. Don’t pay for information that you can get

elsewhere for free.


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Where can you find free information about financial aid?

• Contact College Foundation of North Carolina at CFNC.org or toll free at 866-866-CFNC Service of the State of North Carolina

• Talk to the financial aid administrator at the college of choice

• Ask your high school counselor or visit the local library

• Apply for federal financial aid at FAFSA.ed.gov


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Remember!

You should never have to pay:

• For information about college financial aid

• To apply for federal financial aid (FAFSA)

• To receive financial aid for college


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• Meet earliest deadline of colleges in which you are interested

• Complete all questions accurately

• Estimate if necessary to meet early deadlines

• Don’t wait until you are admitted to file the FAFSA

• Keep a photocopy of all documents for your records


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• Additional documentation may be required… for VERIFICATION of information Tax returns

Untaxed income (Social Security, Child support, Income reported on FAFSA worksheets, other)

Family size

Family members attending college

Other...


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Determination of Expected Family Contribution

Parents’ Contribution

+ Student’s Contribution_________________________

= Expected Family Contribution (EFC)


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Determination of Parents’ Contribution

Parents’ total income for calendar year (Taxable + Non-taxable)

- Federal Tax Paid (not withheld)

- State Tax Paid - Social Security Withholding - Living Allowance - Child Support paid by

parents - Employment allowance___________________________________ = Available Parent Income


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Total net assets (excluding home equity)

- Protection allowance (varies by age of parent)

___________________________

= Net Worth X 12%____________________ = Amount of assets used in

determining EFC


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Available Income

+ Asset Contribution___________________= Adjusted Available IncomeX Percentage___________________= Parent Contribution

Parent contribution will be divided by the number of family members in college, not including parents.


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Determination of Student’s Contribution

Student’s total income for calendar year (taxable and non-taxable)

- Federal tax paid (not amount withheld)

- State tax paid - Social Security withholding - Income protection allowance ($3,080)__________________________________= Student’s Available IncomeX 50%__________________________________= Student’s Contribution from Income


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Total net assets

X 20%________________

= Student’s Contribution from assets


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Student contribution from income

+ Student contribution from assets__________________________

= Total Student Contribution


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Determination of EFC

Parents’ contribution+ Student’s

contribution______________________= Expected Family

Contribution


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Basic Formula for Aid

Cost of Attendance

– Expected Family Contribution

__________________________ = Eligibility for Need-Based

Funds


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Potential Institutional Adjustments to EFC for Institutional Funds

• Establishment of a minimum level of student contribution

• Use of home equity in determination of net assets

• Adjustments for medical/dental expenses

• Adjustments in the losses/depreciation claimed for business/farm operations


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Special Circumstances

• Significant change in your family… Unemployment of a parent

Death in the family

Change in parents’ marital status

Notify the financial aid office at your college of these special circumstances. Be prepared to provide documentation of any change, including the financial impact of the change.


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Sources of Financial Aid

• Federal Government

• State Programs

• Institutional funds

• Outside agencies


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Types of Financial Aid

• Gift

Scholarships

Grants

• Self-help

Loans

Employment


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Federal Aid Programs

• Federal Pell Grant

• Academic Competitiveness Grant

• National SMART Grant

• Federal Supplemental Grant

• Federal Work-Study

• Federal Perkins Loan

• Federal Stafford Loan

• Federal Ford Direct Loan


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North Carolina Aid Programs (partial listing)

• NC Student Incentive Grant

• NC Legislative Tuition Grant

• NC State Contractual Scholarship

• NC Community College Grants

• NC Education Lottery Scholarship

• Education Access Rewards NC Scholars Fund (EARN) (new ‘08-’09)

• UNC Need-Based Grants

• Nurse Scholarships and Loans

• Teacher Scholarships and Loans


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Institutional and Outside Aid

• Institutional Aid

Grants & Scholarships

Loan Programs

Student Employment

• Outside Agencies Local

organizations Churches Civic Groups Parents’

employers Veterans

Administration Vocational

Rehabilitation Services


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Is that all there is?

• Federal Unsubsidized Loans(Stafford or Direct)

• Federal PLUS Loans for parents of dependent students and for graduate or professional students


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Is that all there is?

• Private Alternative Loans for students or parents

Last resort--Always apply for federal loans first!

• College Payment Plans

• Outside Scholarships

• Tax credits--Hope and

Lifetime Learning


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Tax Credits--Hope Tax Credit

Available for the first two years of college Applies to tuition and required fees only. Can claim up to $1650 tax credit---better

than a deduction since it comes directly off taxes owed.─ Can claim 100% of first $1100 expenses and

50% of the next $1100. Examples:

─ If you paid tuition of $5000 in 2007, you will be able to claim $1650 on the tax return completed in early 2008.

─ If you paid tuition of $1100, you will be able to claim only $1100.

─ If you paid tuition of $1800, you can claim $1450 (all of the first $1100, and 1/2 of the remaining $700…which is $350).


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Tax Credits--Lifetime Learning

• Available for all years• Can claim for professional

development type classes as well as remaining undergraduate years and graduate years of college.

• Can claim credit for 20% of tuition & fees, up to maximum of $2,000.

• There are income restrictions on who can claim Lifetime and Hope Tax Credits….consult with your tax advisor!


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IRS Deductions and Credits for 2007

• Certain taxpayers will qualify to take a tax deduction for tuition and fees (even if they don’t itemize).

• Deductions range up to $4000/year.

• Families with adjusted gross incomes up to $80,000 (single filers) & $160,000 (joint filers) can claim credit.

• Cannot claim Hope or Lifetime Learning credit in the same year for same student.

• Check with tax preparer to see if you qualify!


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Additional Information

• College Foundation of North Carolina http://www.cfnc.org

• The Student Guide Published by US Department of

Education http://www.ed.gov/prog_info/SFA/StudentGuide

• Student Financial Aid for North Carolinians At the CFNC Web site, click on paying

for college and then publications.

• http://www.finaid.org

• Publications in local libraries


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Summary

• Lots of aid available from federal and state governments

• Get a PIN now! www.pin.ed.gov

• Student and parent must each have a PIN

• Complete forms by deadlines• Use www.fafsa.ed.gov to

complete, sign and submit application.

http://www.pin.ed.gov/

http://www.fafsa.ed.gov/


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Summary

• Respond promptly to colleges if additional information requested Tax returns or other

information

• College will notify via email, Web or mail of aid eligibility

• Student should follow the colleges’ instructions to accept or decline aid offered.

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Questions?

1 financial aid for college. financial aid presentation project, ncasfaa/ncseaa 2 scope of this...

Documents

financial aid college

state financial aid

college financial aid

college slide

financial considerations

types of federal aid

federal student aid

supplies slide