Financial Aid Basics. Leslie Limper Director of Financial Aid Reed College

Transcription

1 Financial Aid Basics Leslie Limper Director of Financial Aid Reed College

2 Tonight s Agenda Overview of The Financial Aid Process How do I apply? What is financial need? Cost of Attendance (COA) The Expected Family Contribution (EFC) Types and Sources of Financial Aid Next Steps Questions and Discussion

3 The Financial Aid Process Application for admission Application for financial aid (FAFSA) Supplemental applications (CSS Profile, institutional and scholarship applications) Determination of eligibility Notification of award Acceptance of award Disbursement of funds

4 Initial Considerations Merit vs. Need Need Blind vs. Need Aware Meeting Need vs. Gapping Early Decision vs. Early Action vs. Regular Decision Level of Parental Involvement Beyond the Freshman Year

5 FAFSA: Free Application for Federal Student Aid For the academic year, the FAFSA may be filed beginning January 1, 2015 Colleges may set FAFSA filing deadlines Collects financial information used to calculate the family s expected family contribution May be filed electronically, or paper version may be obtained by calling FEDAID

6 FAFSA on the Web Home Page

7 Don t Go There!

8 Student Financial Aid (SFA) PIN Web site: Sign FAFSA electronically Can request PIN before January 1, 2015 Not required, but speeds processing In April 2015, PIN process will transition to usernames and passwords

9 FAFSA Completion Challenges Correct Social Security Numbers Correct Birthdates Definition of a parent Assets

10 Unmarried and Married: Who are The Parents? Never married, living separately: Include the legal custodial parent only Never married, living together: Include both legal parents (note: do not include partners who are not the student s parent) Same sex couples in a state-recognized marriage: Include both parents or legal parent and stepparent

11 Separated, Divorced, Remarried: Who is The Parent? 1. Who did the student live with more during the past 12 months? NONE/EQUAL, then 2. Who provided the most support in the past 12 months? NONE/EQUAL, then 3. Who provided the most support during the most recent year that student actually received support? WHO LAST CLAIMED STUDENT? Remember, include information for stepparent if currently married to The Parent.

12 Assets Assets include: Current cash, savings, and checking balances Investments (including stocks, bonds, trust funds, 529 plans) Rental properties and second homes Assets do not include: Primary residences Family owned businesses (under 100 employees) Family owned farms Retirement accounts

13 Supplemental Financial Aid Applications College Scholarship Service PROFILE (CSS PROFILE) Non-Custodial PROFILE (NCP) Institutional supplemental forms

14 College Scholarship Service (CSS) PROFILE Available in the fall of a student s senior year (useful for ED and EA admission programs) Used by private, usually selective colleges to determine eligibility for need based institutional grant funds Allows families to more completely describe their financial commitments (medical, private elementary and secondary school expenses) Fee-based ($25 for first report, $16 for additional reports)

15 CSS Profile (IM) vs. FAFSA (FM) Includes home equity as an asset Does not allow losses to offset earned income Non Custodial Parent Profile (NCP) calculates a contribution from the non-custodial parent based on financial information submitted by that parent

16 Special Circumstances Cannot report on FAFSA Send explanation to financial aid office at each college College will review special circumstances Request additional documentation Decisions are final and cannot be appealed to U.S. Department of Education

17 Special Circumstances Change in employment status Medical expenses not covered by insurance Change in parent marital status Unusual dependent care expenses Student cannot obtain parent information

18 What is Financial Need? Cost of Attendance (COA) Expected Family Contribution (EFC) = Financial Need

19 What is Cost of Attendance Direct costs Indirect costs Direct and indirect costs are combined into a standardized Cost of Attendance Varies widely from college to college

20 What is the Expected Family Contribution (EFC)? Amount family can be expected to contribute for one year of educational expenses Federal EFC stays the same regardless of college, although colleges may use a different analysis for their institutional funding Two components Parent contribution Student contribution Calculated using FAFSA data and a federal formula

21 What is the Expected Family Contribution (EFC)? Considers parent and student income Considers parent and student assets Considers number of family members Considers number of children in college (excludes parents in college) Does NOT consider an individual family s monthly financial commitments, such as mortgage, living expenses, consumer debt, etc.

22 Types of Financial Aid ( Financial Aid Package ) Scholarships (Merit) Grants (Need) Loans Employment Student can accept all, none, or a portion of any aid offered

23 Student Loans Federal: Fixed interest, may be subsidized by federal government depending on need, no credit test for student Private, alternative: Offered by private lenders, interest/fees based on credit score, often require credit worthy co-signer

24 Parent Loans Federal PLUS: Parents can borrow for dependent student Non custodial parent can borrow for dependent student Step parent can borrow if step-parent s financial information is reported on FAFSA Parents can borrow up to cost of attendance, less any other financial aid

25 Sources of Financial Aid Federal government State (Oregon Student Assistance Commission) Colleges and universities Private sources, civic organizations, and churches

26 The Perfect World An ideal financial aid package would ensure that financial aid applicants are not deterred by cost of attendance at their first choice college

27 The Real World A student s financial aid package is influenced positively or negatively by the availability of funds, annual award amounts and limits, as well as institutional priorities, such as: Enrollment goals Academic profile Diversity (economic, ethnic) Extracurricular activities (sports, music, theatre, etc.) Legacy

28 Award Notification A financial aid package will be sent to the student by the school(s) in paper or electronic format May require written acceptance May include loan information Requires careful scrutiny since content and format vary Financial Aid Shopping Sheet may help standardize format

29 Additional Considerations Need is a federally defined concept and may not reflect a family s actual financial situation Schools may not be able to meet all of a family s federally defined need with financial aid Future indebtedness should be carefully considered when accepting loans Families should report to the school any special circumstances that will affect their ability to pay for college

30 Net Price Calculators Mandated by federal law Net Price is the total Cost of Attendance minus all grant aid Some schools will also include information on loans and work

31 Net Price Calculators Accuracy of net price result is only as good as the accuracy of the information you enter Results will vary from college to college Use caution when providing personally identifiable information such as name, date of birth, or address Comparative net price information can be found at:

32 What Can I Do Now? Apply for a PIN for student AND parent Use Net Price Calculators on college web sites to get an estimate of your expected family contribution (EFC) and eligibility for financial aid OR visit Make a spreadsheet of all admission and financial aid application requirements and deadlines. Visit and start your OSAC scholarship application.

33 Questions?