The Path to Paying for College - It's not too early to start planning!
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The Path to Paying for College It’s not too early to start planning!
Presenter Information Fran C. McKeown Higher Education Access Partner Southeast Region Pennsylvania Higher Education Assistance Agency (PHEAA) fmckeown@pheaa.org
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THE BASICS
What Is Financial Aid? Financial aid consists of funds provided to students and families to help pay for postsecondary educational expenses
Basic Principles • Paying is the joint responsibility of the student and parent(s), to the extent possible. • Need-based financial aid is subject to a federal formula to determine financial need. • Not all families qualify for need-based aid. There is no guarantee that you will get any free money to pay for higher education
Financial Aid Application Process
Know what financial aid forms each school requires
ALL Schools Require: • SOME Schools Require:
• FAFSA (Free Application for Federal • CSS Profile required by
Student Aid) some postsecondary schools
and scholarship
» Required by all schools, PHEAA, and
organizations
some scholarship organizations
• Institutional financial aid
• STATE GRANT FORM (SGF) forms
through PHEAA • Internal school forms
» Required for first-year students (and
may be requested for subsequent
years) - after FAFSA is completed
Financial Aid Forms
ALL Schools Require:
• FAFSA (Free Application for
Federal Student Aid)
» Required by all schools, PHEAA,
and some scholarship
organizations
• May need to file other forms in addition to the FAFSA
for state aid and aid offered by the schools.
Know what forms are Required!
Where Does the Money Come From?
• Federal Government
• State Government
• School/Colleges
• Private Scholarship Sources:
» HS counselors
» Clubs and organizations
» Employers
» Internet scholarship searches
Types of Financial Aid
• Merit Scholarships (free money) scholarships usually
based on:
- academic ability, special talent or achievement,
program of study, family or ethnic background
• Gift Aid (Need Based Grants/Scholarships - free money)
-Need-Based Aid (usually based on - income, assets, other
factors)
• Self-Help (Loans, Work-Study, Savings, etc.)
FAFSA4caster
•FAFSA is the primary federal form for financial
assistance to attend postsecondary school
•It determines:
Expected family contribution, need
Eligibility for most aid programs
•Must file a FAFSA to be eligible for these
programs each year a student attends school
•File online – Fast, Secure, SKIP LOGIC and
Built-in Edits
•Want practice? Visit FAFSA4CASTER*
*Access via link on FAFSA.govFederal Student Aid (EFC) • 2019-2020 Expected Family Contribution (EFC) Formula Guide Link https://ifap.ed.gov/efcformulaguide/attachments/1920EFCFormulaGuide.pdf
What School Costs are Considered?
• School costs include:
Tuition and fees You can receive
Room and board financial aid up to
Books and supplies the total of the
school regardless
Transportation of your EFC!
Miscellaneous living
expenses
Child care, if necessaryCollege Costs - Last 6 Years*
Public 4 Yr. Institution Private 4 Yr. Institution
• 2013-14 $19,830 $44,190
• 2014-15 $20,020 $44,000
• 2015-16 $20,660 $46,330
• 2016-17 $21,100 $47,490
• 2017-18 $21,400 $48,380
• 2018-19 $21,370 $48,510
*For the academic year, estimated undergraduate prices for tuition, fees room and board in 2018 dollars
SOURCE: The College Board, Trends in College PricingAverage Estimated Full-Time Undergraduate Budgets (Enrollment- Weighted) by Sector, 2018-19 SOURCE: The College Board, Trends in College Pricing 2018, Figure 1
Creating a College Plan Salliemae.com/HowAmericaPaysforCollege
Determining Need-Based Eligibility
Calculating Financial Need
School
cost $26,000
EFC –$3,000
Financial
Need $23,000Special Circumstances
Recent death or
disability Contact the
Reduced income school and ask
for a special
Recent separation consideration
or divorce AND contact
Unemployment State Grant
Division at
PHEAAThe Process Continues
Department of Education’s Central Processing System uses the
information from the FAFSA to calculate and create your Need
Analysis
• EFC is calculated
• Student Aid Report or Acknowledgment sent to student
• Information is sent to PHEAA. Student must complete State Grant
Form (SGF). Can link to this directly from the FAFSA.
• Account Access (PHEAA) - Create an account at PHEAA.org to view
PA State Grant
• Information is sent to schools/colleges listed on the FAFSA
• Once accepted - schools produce Award Letters (aid packages)
• You compare Award Letters
• Determine true costs of school and make choicesGood Rule of Thumb- One-Third Rule • Save 1/3 of the expected college costs • Pay 1/3 from current income & financial aid during the college years • Borrow 1/3 using a combination of parent & student loans Source: www.finaid.org
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Plan AheadIt’s never too early to find free money opportunities!
• Start early and keep looking
• Check with school counselor about local opportunities
• Google your interests (Google “unusual scholarship”)
• Activities, Athletics, Family, Hobbies, Participation,
Attributes – Do your research!
• Don’t miss deadlines!Financial Literacy Tools
https://collegecost.ed.gov
• Net Price Calculator
Center
• College Navigator
• College Scorecard
• College Affordability
& Transparency ListNet Price Calculator (NPC) What is a Net Price Calculator? What does Net Price mean? https://collegecost.ed.gov/netpricecenter.aspx
College Navigator What is College Navigator? Here you can search for and compare colleges on all sorts of criteria including costs, majors offered, size of school, campus safety, and graduation rates. https://nces.ed.gov/collegenavigator/
Institutional Detailed information
Institutional Detailed information cont….
College Scorecard
Search Schools by:
Program Degree, Location,
Size, Name, Type, Mission,
etc. and compare
Focus on Five Key Items
1. Cost
2. Graduation rate
3. Loan default rate
4. Employment
5. Average amount
borrowed
https://collegescorecard.ed.govCollege Affordability & Transparency Center Research Schools with the Highest & Lowest Tuition & Net Prices
MySmartBorrowing.org Interactive online tool to assist students with making informed choices about postsecondary education.
How It Works
MySmartBorrowing guides students and families through four
easy sections:
Select a Career Factor in Savings
Select a School Get ResultsCollege Cost Projector Calculate Future College Costs Source: www.finaid.org/calculators
College Cost Projector cont… College Costs Results Source: www.finaid.org/calculators
College Cost Projector Example cont… Result: First Year Projected Costs: $29,849.09 Second Year Projected Costs: $31,341.54 Third Year Projected Costs: $32,908.62 Fourth Year Projected Costs: $34,554.05 Total Projected Costs: $128,653.29 Source: www.finaid.org/calculators
Loan Calculator Example – Year One
Loan Calculator Result – Year One
Loan Calculator Example – Year Two
Loan Calculator Result – Year Two Result – Year Two:
Online Resources • PHEAA.org • EducationPlanner.org • MyNextMove.org • MySmartBorrowing.org • YouCanDealWithIt.com • MyFedLoan.org • https://CollegeCost.ed.gov • https://Bigfuture.Collegeboard.org/college search
Thanks & Best Wishes! Questions?
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