Education Lights the Way at

Education Lights the Way at UC Irvine

Today s Topics Sources of Financial Aid General Eligibility Criteria Cost of Education Application Process Needs Analysis Types of Financial Aid Comparing Aid Offers 2

Goals of Financial Aid The primary goal is to assist you in paying for college by Evaluating your family s ability to pay for educational costs by assessing the financial strength via the FAFSA. Distributing limited resources in an equitable manner based on the student s financial need. Providing a balance of gift aid and self-help aid to cover the educational costs in an academic year. 3

Sources of Financial Aid Federal Government State Government Colleges/Universities Banks/Credit Unions & Corporations 4

General Eligibility Criteria Must be enrolled or accepted for enrollment in an eligible program of study Must be pursuing a degree, certificate or other recognized credential Must be U.S. Citizen or eligible non-citizen Males must be registered with Selective Service Other, less common, criteria also apply 5

Cost of Education - Varies depending on Institution - $60,000 $50,000 $40,000 $30,000 $20,000 $10,000 $0 CCC CSU UC Private CCC: Cost estimated for living at home CSU, UC, Private: Cost estimated for living on campus 6

UC Irvine Costs* (2013-14) Commuter On Campus Off Campus Tuition & Fees $14,508 $14,508 $14,508 Room & Board $4,470 $12,073 $9,737 Books & Supplies $1,583 $1,583 $1,583 Transportation $1,814 $974 $1,997 Personal Costs $1,703 $1,366 $1,723 Total Costs $24,078 $30,504 $29,548 You have some control over costs. Be cautious and budget. *The tuition, fees, and charges posted here are estimates based on currently approved amounts. These figures may not be final. Actual tuition, fees, and charges are subject to change by the Regents of the University of California. 7

Tips on Reducing Costs Set a budget and stick to it Save on housing costs by doubling up and sharing a room Opt for used books first, and resell at the end of the term Buy supplies from discounters instead of the campus bookstore Choose the right meal plan If the school requires health insurance consider waiving out Leave the car at home (gas, maintenance, insurance and parking) Take advantage of on-campus subsidized activities, such as athletic events, which are often free with a student ID card Take advantage of discounts exclusively for college students, such as cell phone service and computer discounts 8 8

Types of Financial Aid Applications FAFSA Cal Grant GPA Verification Form Other applications/forms as required by the college, such as: -CSS/Financial Aid PROFILE -Institutional Scholarship and/or Financial Aid Application *If you meet AB540 criteria and you are not eligible to file a FAFSA, complete a California Dream Application instead: www.csac.ca.gov/dream_act.asp 9

FAFSA on the Web Web application used to complete electronic FAFSA at: www.fafsa.gov Sophisticated on-line edits and skip logic so that errors are less likely. On-line help is available for each question. Student and one custodial parent should get a federal PIN at: www.pin.ed.gov 10

FAFSA on the Web Worksheet 11

Getting Ready to Complete the FAFSA Before starting the FAFSA, gather: Student driver s license Student Alien Registration Card Student and Parent: Social Security cards 2013 W-2 Forms and records of money earned and other taxable benefits 2013 federal income tax form (even if not yet completed) Records of untaxed income Current bank statements Business, farm, and other real estate records Records of stocks, bonds, and other investments Create a file for copies of all financial aid documents submitted. 12

Federal PIN PIN (Personal Identification Number) serves as the electronic signature on ED documents. Both student and one parent need PINs to sign the FAFSA electronically. May be used to: Check on FAFSA status Verify and correct FAFSA data Add additional schools to receive FAFSA data Change home and e-mail addresses If an e-mail address is provided, PIN will be e-mailed to the PIN applicant within minutes. Apply for student and parent PINs at: www.pin.ed.gov 13

Parental Information Who is a parent??? Biological or adoptive parent(s) In case of divorce or separation, it s the parent and/or stepparent the student lived with more in the last 12 months. Stepparent (regardless of any prenuptial agreements) 14

Using the IRS Data Retrieval Tool (DRT) 1) Enter your PIN* and click Link To IRS. *(You will not be asked to enter your PIN if you entered a PIN to begin your FAFSA) 2) Your FAFSA will be saved and you will be transferred to the IRS Web site. 3) On the IRS Web site, enter the requested information. 4) Once the IRS has validated your identification, your IRS tax information will display. You can either transfer your information from the IRS, or choose to return to FAFSA on the Web from the IRS Web site. 5) If you transfer your IRS tax information, questions that are populated with tax information will be marked with Transferred from the IRS. 15

Parent Cash, Savings, and Checking Most parents will be asked to report the current balances of their cash, savings, and checking net value of their investments such as real estate, rental property, money market and mutual funds, stocks, bonds and other securities net value of their businesses, partnerships and investment farms Do not report the home in which you live, the value of life insurance and retirement plans, or the value of a family-owned and controlled small business (less than 100 employees) 16

How do I report investments? 17

Impact of Section 529 Plans on Financial Aid Eligibility 529 College Savings Plans are tax-exempt college savings vehicles with a low impact on need-based financial aid eligibility. They are treated as an asset of the owner Redemptions are also exempt from federal income tax if used to pay for qualified higher education expenses such as tuition, room and board, fees, books, supplies and equipment Value is reported as an asset of the owner on the FAFSA Redemptions not owned by the student or parent are reported as other untaxed income on the FAFSA California s plan is the Golden State Scholarshare Trust managed by Fidelity 18

Application Filing Tips FAFSA on the Web Gather necessary documents ahead of time Complete a FAFSA on the Web Worksheet available at: www.fafsa.gov Allow ample time to complete the online FOTW application for submission by the deadline Check the FAFSA on the Web for accuracy prior to submission. If you find a mistake, log back in and correct it Save all work periodically If taxes aren t filed yet, estimate your income and update after filing File your taxes on time Sign the application using student s and one custodial parent s PINs Keep a printed copy of the FAFSA and Submission Confirmation Page. Don t be afraid to ask for help! 19

Pitfalls to Avoid Missing deadlines Filing a tax extension Misreporting information Failing to re-apply for financial aid each year Ignoring financial aid emails Paying for assistance 20

Needs Analysis Information reported on the FAFSA is analyzed to determine how much the family can pay toward college expenses. Key factors: -Student s income* -Parents income* -Student s assets** -Parents assets** -How many people are in the family household -How many of those people are in college * Students are generally expected to contribute 50% of their available income, after allowances. Parents are generally expected to contribute between 22% and 47% of available income, after allowances. ** Student are generally expected to contribute 20% of the net-worth of their assets in support of their family contribution. Parent generally expected to contribute a sliding scale percentage of the the network from assets with the maximum of 12%. Parent assets are also partially sheltered by an asset protection allowance based on the age of the older parent (around $45,000 for most parents of collegeage children). The result is the Expected Family Contribution (EFC). The formula is set by Congress and it is not perfect! 21

Needs Analysis Your EFC is the figure used by your school to calculate the amount of need-based student aid you are eligible to receive. Your EFC is not the amount of money your family will have to pay for college nor is it the amount of federal student aid you will receive NEED = COST OF ATTENDANCE - EFC Cost of Attendance $30,504 - Estimated Family Contribution - 2,500 = Need $28,004 22

Types of Financial Aid Gift Aid - Grants or scholarships that do not need to be repaid Work - Money earned by the student as payment for a job on or off campus Loans* - Borrowed money to be paid back, usually with interest *Federal student loans are available to most students regardless of income and provide a range of repayment options including income-based repayment plans and loan forgiveness benefits, which other education loans are not required to provide. 23

Types of Aid: Gift Aid Scholarships: Awarded on the basis of academic performance, special talents, and other factors Generally replace loans UC Admissions application also for scholarships Alert! Utilize reputable private scholarship search tools scams: www.finaid.org/scholarships/scams.phtml Grants: Awarded on the basis of demonstrated financial need Do not have to be repaid (Federal, State and University) 24

Types of Aid: Scholarships University Scholarships: Such as campus-wide, departmental, athletic and restricted scholarships Application processes and deadlines vary Private Agency Scholarships: From foundations, clubs & organizations, banks, employers, high schools, etc. Typically apply directly to the organization Scholarship Search Engines: Collegeboard.org Collegenet.com Fastweb.com Finaid.org Collegetoolkit.com 25

Federal Grants Types of Aid: Grants Pell Grant (maximum of $5,645 for 2013-14) SEOG (Supplemental Educational Opportunity Grant) State Grant Cal Grant A (2013-14 $12,192 UC, $5,472 CSU, $9,223 privates) University Grant 26

Cal Grant Application Requirements By March 2*, 2014, complete and submit: *(or the next business day if March 2nd falls on a weekend) Free Application for Federal Student Aid (FAFSA) + Cal Grant GPA Verification Form -Note: If you meet AB540 criteria and you are not eligible to file a FAFSA, complete a California Dream Application instead of a FAFSA -Check with your high school or college counselor for more details on how to file the Cal Grant GPA Verification Form 27

Types of Aid: Loans and Work Loans: Require repayment Offered to most students Offset by scholarships Available from federal government, institutions and banks/credit unions Work-Study: Provides opportunity for employment while enrolled Work study not required to work on campus Note: Many on-campus jobs are available without work-study 28

Types of Aid: Federal Stafford Loans No credit check required Subsidized Direct Loans: The government pays the interest while a student is enrolled at least half-time. Students must demonstrate $200+ of financial need. Interest Rate is 3.86% for 2013-14 Origination fee of 1.072% Unsubsidized Direct Loans: Students are responsible for paying the interest during enrollment. Interest Rate is 3.86% for 2013-14 Origination fee of 1.072% Annual Limits Subsidized Additional Unsub* Combined Sub & Unsub Dependent Students Independent Students Dependent Students Independent Students Freshman $3,500 $2,000 $6,000 $5,500 $9,500 Sophomore $4,500 $2,000 $6,000 $6,500 $10,500 Junior/Senior $5,500 $2,000 $7,000 $7,500 $12,500 * In addition to any unused subsidized eligibility 29

Types of Aid: Federal Stafford Loans SAMPLE REPAYMENT The average loan indebtedness for an undergraduate receiving a bachelor's degree from UC Irvine in 2012 was $18,132. The table below reflects the amounts repaid based on the three repayment options: Repayment Plan Term (in months) Initial Monthly Payment Amount Total Payments (principal + interest) Standard Plan 10 years (120 months) $208.66 $25,039.64 Extended Plan* N/A N/A Graduated Plan 10 years (120 months) $120.36 $26,943.84 * Extended Repayment Plan is only available for loan balances greater than $30,000. 30

Types of Aid: PLUS Loan Federal Direct Parent Loan for Undergraduate Students (PLUS) The PLUS program is designed to assist parents of dependent undergraduate students who are unable to meet their expected parental contribution or have additional financial need that is not met with other financial aid resources. Parents may borrow up to the annual cost of attendance minus any other financial aid. Parents must have a positive credit check. 6.41% interest rate for 2013-14 PLUS borrowers will be charged a 4.288% origination fee. Must file the FAFSA each year to receive the loan Repayment begins 60 days after the final disbursement in the same academic year. 31

Differences Between Federal and Private Student Loans Unlike private loans, federal student loans are required flexible repayment options such as income-based and income-contingent repayment plans. Unlike private loans, federal student loans are required by law to provide loan forgiveness benefits. Federal direct loans are available to most students regardless of income (other qualification criteria do apply). Private student loan lenders can offer both fixed and variable interest rates that can change, rates on federal loans are set annually. The interest rate on a private loan may depend on the borrower's and/or co-signer's credit rating. 32

Comparing Aid Offers - Shopping Sheet 33

Comparing Aid Offers Determine Your Net Costs for University A and University B and then Compare Them: Cost of Attendance - Grants & Scholarships = Net Cost UNIVERSITY A UNIVERSITY B Cost of Attendance $50,000 Cost of Attendance $32,500 - State Grant $9,223 - Federal Grant $4,000 - University Grant $20,000 NET COST = $16,777 - State Grant $12,192 - Federal Grant $4,000 - University Grant $5,500 NET COST = $10,808 38

Net Price Calculators By answering questions on a Net Price Calculator, you will receive a personalized estimate of the cost of attendance and financial aid that may be available to you at a college/university. Note: you are NOT applying for financial aid by completing a Net Price Calculator. Department of Education Net Price Calculator Center: collegecost.ed.gov/netpricecenter.aspx UCI Net Price Calculator: www.ofas.uci.edu 39

Use the shopping sheet Comparing Aid Offers Compare net cost rather than cost of attendance Use the net price calculator If you re considering an out-of-state school, factor in moving and travel expenses (holidays as well as between terms and summer) If you re considering a school in a cold climate, consider additional wardrobe costs Make sure you understand the renewal terms and conditions for scholarships and grants you ve been offered 40

Sample UC Aid Awards for Different Families Assumes 4 in the family 1 in college Minimal investments and assets Amy Leonard Sheldon Penny Howard Raj Family Income $ 20,000 $ 40,000 $ 60,000 $ 100,000 $ 130,000 $ 150,000 Cost of attendance $ 30,500 $ 30,500 $ 30,500 $ 30,500 $ 30,500 $ 30,500 Gift aid $ 21,500 $ 21,500 $ 18,500 $ 5,000 $ - $ - Loans $ 9,000 $ 9,000 $ 12,000 $ 25,500 $ 30,500 $ 30,500 "Net Cost" $ 9,000 $ 9,000 $ 12,000 $ 25,500 $ 30,500 $ 30,500 Disclaimer: These examples are in no way meant as a guarantee of aid eligibility. Actual financial aid awarded is dependent on many factors. Check with your local financial aid office regarding the specifics of your financial aid eligibility. 41

Covered 2013-14 system-wide fees ($12,192) for California residents whose families earned less than $80,000 a year and student qualified for financial aid. Qualified students must be in their first four years of attendance (first two years for transfer students). Complete information available at www.universityofcalifornia.edu/blueandgold/ 42

New program beginning in the 2014-15 academic year For families making up to $150,000/yr Once fully phased in will cover up to 40% of system-wide fees at UC and CSU campuses ($4,976 at UC based on 2013-14 fees) 2014-15 at 14%, 2015-16 at 20%, 2016-17 at 30%, and 2017-18 at 40% Must be a California resident Must complete a 2014-15 Free Application for Federal Student Aid (FAFSA) or the California Dream Act Application by March 2 nd Families earning between $100,001 and $150,000 will have their eligibility reduced on a sliding scale 43

Helpful Resources Federal Pin for Electronic FAFSA: www.pin.ed.gov Electronic FAFSA : www.fafsa.gov General Questions to U.S. Dept. of Ed. and FAFSA Processing Issues: 1-800-433-3243 www.ed.gov California Student Aid Commission (CSAC): www.csac.ca.gov Cal Grant Information 1-888-224-7268 44

Questions and Answers UCI faculty study dark matter and its importance to humanity. 45