College Financing Tips

Whatever type of school beyond high school you attend—whether it's university, trade school or community college—you have to be thinking about how you're going to pay for it. The cost of education continues to rise. But if you're determined to achieve the success that education beyond high school can bring, the investment is worth it. But that doesn't mean managing these costs isn't a challenge.

What is federal student aid?

Federal student aid is financial assistance through the U.S. Department of Education available to eligible students enrolled in an eligible programs as regular students at schools participating in our federal student aid programs. Federal student aid covers school expenses such as tuition and fees, room and board, books and supplies and transportation. This aid can also help you pay for a computer and dependent child-care expenses.

Most student financial aid comes from federal government programs. The U.S. Department of Education's office of Federal Student Aid administers these programs. Applying for federal student aid is FREE; that's why our application is called the Free Application for Federal Student Aid.

(FAFSA). If you need help completing the FAFSA, that help is free too. You don't have to pay anyone for help and you should be aware of scams and services that will search for financial aid for you for a fee. The College Scholarship Fraud Protection Act protects you from this type of fraud.

Who gets federal student aid?

Eligibility for most federal student aid programs is based on financial need and several other factors. Your eligibility is determined by the information you provide on the FAFSA.

Basic eligibility requirements:

• Demonstrate financial need
• Be a U.S. citizen or eligible noncitizen* (for most programs) with a valid Social Security number.
• Be working toward a degree or certificate in an eligible program.
• Show, by one of the following means, that you're qualified to obtain a postsecondary education:
  • Have a high school diploma or a General Educational Development (GED) certificate.
  • Pass an approved ability-to-benefit (ATB) test (if you don't have a diploma or GED, a school can administer a test to determine whether you can benefit from the education offered at that school).
  • Meet other standards that your state establishes and that we have approved.
  • Complete a high school education in a home school setting approved under state law.
• Register (if you haven't already) with the Selective Service, if you're a male between the ages of 18 and 25.
• Maintain satisfactory academic progress* once in school.

FAFSA4caster

If you're not attending college this fall, but would like to find out how much federal student aid you might be eligible for, the FAFSA4caster is for you. This new product is for those who want to get an early start on the financial aid process. You can access FAFSA4caster at www.FederalStudentAid.ed.gov.

What type of federal student aid might I get?

There are three types of federal student aid:

• Grants—financial aid that doesn't have to be repaid (unless, for example, you withdraw from school and owe a refund).
• Work-Study—allows you to earn money for your education.
• Loans—allow you to borrow money for your education. You must repay your loans, with interest.

How do I apply for federal student aid?

STEP 1:

Get free information and help from your school counselor, the financial aid office at the college or career school you plan to attend, or the U.S. Department of Education, Federal Student Aid at www.FederalStudentAid.ed.gov or 1-800-4-FED-AID (1-800-433-3243). Free help is available any time during the application process. You should never have to pay for help.

STEP 2:

Get a Federal Student Aid PIN, a personal identification number. A PIN lets you apply, "sign” your online Free Applicationfor Federal Student Aid (FAFSA), make corrections to your application information, and more—all online. Apply for a PIN at www.pin.ed.gov.

STEP 3:

Collect the documents needed to apply, including income tax returns and W-2 forms (and other records of income). A full list of what you need is at www.fafsa.ed.gov. Tax return not completed at the time you apply? Estimate the tax information, apply, and correct information later.

STEP 4:

Complete the FAFSA between Jan.1, 2008 and June 30, 2009 (no exceptions to either date!). BUT, apply as soon as possible on or after Jan.1 to meet school and state aid deadlines (see note at bottom of page). Apply online (the faster and easier way) by going to www.fafsa.ed.gov.

STEP 5:

Federal Student Aid will send you a Student Aid Report (SAR)—which is a summary of the information from your FAFSA. Review your SAR, and if necessary, make changes or corrections and submit your SAR for reprocessing. Your complete, correct SAR will contain your Expected Family Contribution (EFC)—the number used to determine your federal student aid eligibility.

STEP 6:

If you are selected for verification, your school's financial aid office will ask you to submit tax returns and other documents, as appropriate. Be sure to meet the school's deadlines, or you will not receive federal student aid.

STEP 7:

Whether you're selected for verification or not, make sure the financial aid office at the school has all the information needed to determine your eligibility.

STEP 8:

All students: Contact the financial aid office if you have any questions about the aid being offered.

First-time applicants: Review award letters from schools and compare the aid being offered. Decide which school to attend based on a combination of:

1. How well the school suits your needs (programs of study and academics).
2. Its affordability after all aid is taken into account.

Education beyond high school is a big investment of time, money and effort. You'll need to figure out how to pay for your education but all the effort you put into it will be worth it. Over a working life, a person with a bachelor's degree will earn almost twice as much as someone with just a high school diploma. More education equates to higher earnings. This is most noticeable at higher education levels. The more education you have, the more you earn. So invest in your education; the payoff lasts a lifetime.

The information within this article is excerpted from Funding Education Beyond High School: The Guide to Federal Student Aid, a publication of the U.S. Department of Education's office of Federal Student Aid. For more information on applying for federal student aid, please visit www.FederalStudentAid.ed.gov.