Understanding Financial Aid

The biggest dilemma for most when it comes to college is “How can I afford it”. College is very expensive & the price of tuition goes up every year. But with financial aid it can be affordable. In early January, all students should apply for FAFSA (Free Application for Federal Student Aid). It’s free & all students should reply regardless of your parents’ income.

FAFSA is a series of questions where your answers will determine two things: how much money/asset your family have & your EFC (expected family contribution). Your EFC is you’re out of pocket cost for college. For example if your EFC is 000000 it means your expected out of college cost is zero dollars, but if your EFC is 008000, then you are expected to pay $8000 out of pocket for college. After applying for FAFSA & determining your EFC, some schools might need additional information to process your financial aid, so be sure to check the mail & respond.

Now let’s break down the financial aid package to see how affordable college is for you. It’s crucial to understand your financial package especially the loans & the expected out of pocket cost.

Federal Grants: Grants are money given to you from the government in which you do not have to pay it back. Think of it as free money.

  • Federal Pell Grant
  • Mass Grant
  • Federal Supplemental Educational Opportunity Grant (FSEOG)

Federal Work Study: This is when a school allows you a work study job to help pay for your school expenses. You are only awarded the money once you find a work study job. For example, if you are awarded $1500 in work study for the spring semester, it’s your responsibility to find a job & apply the money towards the bill. If you choose to pocket the money, you will still be responsible for the $1500 you owe.

School scholarships: Schools can award you scholarships in many different field such as academics, sports, civil engagement, & etc. Think of this as an investment on you from the school. Keep in mind with these scholarships, you must to maintain the agreement & criteria to keep the scholarship. For example, if you are getting a free ride to play basketball & for some reason you can’t play anymore, your athletic scholarship will be revoke & you become responsible for that portion.

Federal Loans:

  • Federal Perkin Loan Programs: A school based loan where the school is the lender & it is determined by your financial eligibility
  • William D. Ford Federal Direct Loan: Students are the lender of these loans which have low and fixed interest rate that can be subsidized and/or unsubsidized.

*As an undergraduate you are allowed to borrow a maximum of $50,000 in federal loans*

Avoid these not so great loans:

  • Direct Plus Loans: Parents are the borrower and interest rates aren’t as low.
  • Private or Bank Loans: Such as Sally Mae or Wells Fargo where interest rates are high

Outside scholarships: There are hundreds of scholarships but you just have to search and apply for them. Try Fastweb.com. Look online and ask friends/family to see if their job offer scholarships or if they know of any. Look into your community such as churches, stores, and organizations such as the Boys and Girls Club for scholarships.

When looking at your financial aid package make sure to look at how much each school is giving you and the schools that offer you the most money and least out of pocket cost. Money becomes a huge factor when deciding for school because you want to make sure you can afford college. You do not want to come out with a $200,000 debt where today college students are expected to graduate with an average of $40,000 debt. Review the package and remember it is okay to deny loans if needed. Just call the financial office and see if they can repackage your aid. The cost of college can be stressful, but make sure to take your time, review the aid packages, talk to your parents, & good luck deciding which college you can afford.


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