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The Financial Aid Process . Albina Grignon Grignon Educational Consultants 692-8376. Introduction. How and When to Apply Types of Aid Programs Available Additional Financing Options Outside Scholarships/Aid Renewal/Special Circumstances. How and When to Apply .
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The Financial Aid Process Albina Grignon Grignon Educational Consultants 692-8376
Introduction • How and When to Apply • Types of Aid Programs Available • Additional Financing Options • Outside Scholarships/Aid Renewal/Special Circumstances
How and When to Apply • Request a Federal PIN Number at www.pin.ed.gov • Collect Documents • Fill out the pre-application worksheet • Complete FAFSA online at www.fafsa.ed.gov after January 1st. • Use link to apply for TAP • Keep records
How and When to Apply • Check “will file taxes” • Estimate financial information • Questions? 1-800-4FEDAID or www.fafsa.ed.gov • Terms-Expected Family Contribution EFC • Student Aid Report-SAR • Govt. conducts a “needs analysis” based on financial information submitted
Types of Aid Programs Available • Grants and Scholarships • - Pell Grant • - TAP Grant • - Merit Scholarships • Federal Work-Study • Federal Perkins Loan • Federal Stafford Loan (subsidized vs. unsubsidized interest around 6.8%) 66% of 4 year college graduates had loans
Additional Financing Options Parent Plus Loan Payment Plans Four Installment Payment Plans set by the college Home Equity Line of credit not a loan. If get a loan and don’t spend all money before next FA form, considered an asset and paying interest on full amount
Other Aid and Special Circumstances • Impact of Outside Scholarships-apply for local scholarships Rotary, Credit Union, professional organizations • Special Circumstances and Appeals • Disability, Death, Divorce will review immediately • Loss of Job, loss of income usually will review in October
Special Circumstances • The parents adjusted gross income is under $50,000 AND • All family members are eligible to file IRS form 1040A of 1040EZ • Then the family qualifies for the Simplified Needs Test which disregards assets when determining the expected family contribution
Avoid Common FAFSA Filing Errors • Missing Signatures • Reporting Income of parent no longer in household • Confusing “Tax paid” same figures as AGI • Reporting “taxes withheld”(W-2) instead of “taxes paid” • Missing income and asset information
Avoid Common FAFSA Filing Errors • Zeros for Worksheet A,B,C • Non custodial parent listed as family income (e.g. grandparent, aunt) • Wrong SSN/Birth date • USE FinAid’sEFC calculator in detailed mode to see where there is any contribution from parent assets.
Strategies 2012 and beyond • Save money in parent’s name not the child’s name or use a 529 savings plan-asset disregarded if owner is other than student or parent such as grandparent • Spend down the student’s assets and income first- student’s assets “taxed by FAFSA” at higher rate in needs formula than parents • If family’s financial circumstances are unusual, make an appointment with financial aid administrator at school • Do not withdraw money from retirement fund since it is viewed as income. Retirement funds not assessed in needs formula. Try to borrow from retirement fund. • Accelerate necessary expenses to reduce cash • Community College for first two years-45% of all first year students start at a community college
Questions? • Please feel free to call me at 692-8376 with any questions you may have.