Financing Your Education Beyond High School! 2012– 2013

1. Financing Your Education Beyond High School! 2012– 2013

2. Some Questions • What is financial aid? • Where does it come from? • What aid is available? • Who is eligible? • How do I apply?

3. What is Considered Financial Aid? • Scholarships – Merit Scholarships are based on Talent / Ability. • Grants – Aid based on financial need. Provided by Federal and State Government OR the University. • Loans – Low interest Federal Loans for Students and Parents. Private Loans also available. • Employment Opportunities – work-study or non work-study jobs on/off Campus

4. How Aid Is Classified • Gift aid: Scholarships and Grants • Self-help aid: Loans and employment based on need or non-need

5. Goals of Financial Aid Administrator When Awarding Aid To assist students in paying for college by: 1.Evaluating family’s ability to pay educational costs – when the family completes the Free Application for Federal Student Aid (FAFSA) 2.Distributing limited resources in an equitable manner – packaging policies for awarding same for all. 3.Providing balance of gift aid and self-help aid

6. In order to award financial aid to a student, Financial Aid must first must determine the: Cost of Attendance (COA) set by the university AND The Expected Family Contribution (EFC) calculated when the student completes the FAFSA This determines the student’s FINANCIAL NEED

7. The College/University Determines Cost of Attendance (COA) • Tuition/Fees and Room/Board (largest part of COA) • Books, supplies • Transportation • Miscellaneous, personal expenses • Loan fees These additional costs may be added to the cost of attendance with adequate documentation. • Study abroad costs • Dependent care expenses • Other costs if deemed appropriate (computer)

8. This slide shows how the student’s Financial Need will look depending on the cost of attendance at different Universities/Colleges

9. Principles Applied to Processing a Student’s FAFSA Resulting In An EFC • To extent they are able, parents have primary responsibility to pay for dependent child’s education • Students also have responsibility to contribute to educational costs • Families should be evaluated in their present financial condition – FAFSA asks for prior year income information • Family’s estimated ability to pay educational costs must be evaluated in an equitable and consistent manner, recognizing that special circumstances may affect family’s ability to pay

10. In order to apply these principles fairly, Federal Methodology will be used when your FAFSA is processed. Federal Methodology is the formula created by Congress to determine the EFC when a student completes the FAFSA.

11. Federal Financial Aid You May Be AwardedFederal Pell Grants • Awarded to eligible undergraduates pursuing first baccalaureate degree and certain students enrolled in post-baccalaureate teacher certification or licensing programs • Portable – may be awarded wherever the student attends, even if transferring. • Actual award amount based on COA, EFC, and enrollment status • Maximum award 2012-13 = $5,550/yr

12. Federal Supplemental Educational Opportunity Grants - FSEOG • Eligible students: • Undergraduates pursuing first baccalaureate or professional degree • Awarded first to students with “exceptional financial need” (i.e. students with lowest EFCs at that school) • Priority to Federal Pell Grant recipients • Annual award amounts: • $100 minimum • $4,000 maximum

13. Teacher Education Assistance for College and Higher education (TEACH) Grant • TEACH Grants can be received by students who intend to teach in a public or private elementary or secondary school that serves students from low-income families after graduation. • Grant awards are up to $4,000/year. • Not all schools participate in the TEACH grant program. • To verify if a school participates in the TEACH grant program or if you have any questions about the TEACH grant, please contact the school’s Financial Aid Office.

14. William D. Ford Federal Direct Loans • Student loans available under: • Federal Direct Student Loan Program with funds provided directly by federal government via participating schools • School determines loan eligibility and delivers loan proceeds to students

15. Two Types of Federal Direct Loans • Subsidized: Must demonstrate “need” (when EFC is subtracted from the COA); interest paid by federal government while student in school. • Unsubsidized: Not based on “need” and interest is not paid by federal government while student in school. • Base annual loan limits (combined subsidized and unsubsidized): • $5,500 for 1st year undergraduates • $6,500 for 2nd year undergraduates • $7,500 for each remaining undergraduate year

16. Federal Direct Loans (con’t) • Additional UNSUBSIDIZED loan eligibility for independent undergraduate, and dependent students whose parents are denied the PLUS: • $4,000 per year for 1st and 2nd year undergraduates • $5,000 per year for remaining years of undergraduate study

17. Federal Direct Loans (con’t) • Interest rate is fixed at 6.8% • Loan fees based on principal amount of each loan: • Direct Loan: Up to 4% loan fee

18. Federal Direct Loans (con’t) • Repayment begins after 6-month grace period • Maximum repayment period between 10 and 30 years depending on repayment plan chosen • Deferment and cancellation provisions available

19. Federal Perkins Loan • Student loan awarded based on financial need • May receive up to $5,500/yr • Fixed interest rate of 5% • Repayment same as Stafford loan, except you repay school • Various ways for loan to be canceled

20. PLUS Loan • Parent loan program for parents of dependent undergraduate students • Annual loan limit: COA minus other aid • Fixed interest rate of 7.9% for Direct Loans • Repayment usually begins 60 days after loan is fully disbursed. Deferment options exist.

21. State Financial Aid Programs www.collegefortexans.com • Must first complete the FAFSA to determine financial need • TEXAS (Towards Excellence, Access and Success) Grant • May receive up to $6,080/yr at the state's public colleges and universities • Tuition Equalization Grant (TEG) program • Provides grant aid to financially needy students to enable them to attend private, non-profit colleges or universities in Texas • General program maximum is $3,518/yr

22. General Eligibility Requirements Federal Financial Aid • Student must be enrolled or accepted for enrollment in eligible program of study • Must be pursuing degree, certificate, or other recognized credential • Must be U.S. citizen or eligible noncitizen • Must be registered with Selective Service (if male between ages of 18 and 25) • May not have eligibility suspended orterminated due to drug-related conviction

23. Eligibility Criteria (con’t) • Must have valid Social Security Number (SSN) • May not be in default on a federal student loan • Must not owe an overpayment of federal grant or loan funds • Must be making satisfactory academic progress, as defined by school.

24. Role of the Financial Aid Office • Determines aid eligibility when FAFSA received from federal processor • Packages aid depending on availability of funds • Sends award notification including: • Amount awarded from each program for which student is eligible • Disbursement methods and time frames • Terms and conditions of each award

25. Undergraduate Financial Aid Advisors • Advisor caseloads are divided up using the first letter of a student’s last name. • Cindy Luetzow F, M, N, T • Walker Self B, D, H • Gordon Brannon C, E, L, W • Minerva Chihuahua A, G, S • Gina Kelbert J, K, P, R • Penny Griffin I, O, Q, U, V, X, Y, Z

26. Financial Aid Application Process • Submit FAFSA prior to school’s deadline • Most aid awarded on “first-come, first-served” basis • To ensure maximum consideration for federal, state, and institutional aid, check information from each school to determine: • Required application materials • Application deadlines

27. About the FAFSA • Collects family’s prior year personal and financial information used to calculate student’s EFC • Available in English and Spanish • Must be completed via FAFSA on the Web

28. FAFSA on the Web • Web site: www.fafsa.gov • 2013-2014 FAFSA on the Web available on or after January 1, 2013 • Pre-Application Worksheet: • Available prior to January 1st • Questions follow order of FAFSA on the Web

29. IRS Data Retrieval for FAFSA • While completing the FAFSA, applicant may submit real-time request to IRS for tax data • IRS will authenticate taxpayer’s identity • If match found, IRS sends real-time results to applicant in new window • Applicant chooses whether or not to transfer data to the FAFSA

30. IRS Data Retrieval for FAFSA • Available late January 2013 for 2013-14 processing cycle • Participation is mandatory • May not have to provide IRS Tax Transcript to verify Income. • Not available to applicants with a recent change in marital status

31. But, Before Filing FAFSA - PIN Registration • Web site: www.pin.ed.gov • Can get PIN before January 1, 2013 • May be used by students and parents throughout aid process, including subsequent school years

32. CAUTION! • Avoid being charged a fee to file the Free Application for Federal Student Aid • Completion and processing of the FAFSA are FREE • Go to www.fafsa.gov • If you need help, you may contact the federal processor or Financial Aid Office

33. Remember…ERRORS can be COSTLY! Errors on the FAFSA or supplemental forms may DELAY application processing and result in the LOSS of financial aid funds. Read the instructions and complete all forms carefully!

34. Common FAFSA Errors • Parent and student Social Security Numbers • Divorced/remarried parental information • Income earned by parents/stepparents • Untaxed income • U.S. income taxes paid (not withheld) • Household size • Number of household members in college • Real estate and investment net worth

35. Once FAFSA is processed - Results in several ways: • Central Processing System (CPS) notifies student of FAFSA processing results by: 1. SAR Information Acknowledgement if filed FAFSA electronically on the Web and student’s e-mail address was not provided 2. E-mail notification containing a direct link to student’s on-line SAR if student’s e-mail was provided on paper or electronic FAFSA • Students with a PIN can view SAR on-line at www.fafsa.gov

36. Making Corrections to FAFSA • Use FAFSA on the Web (www.fafsa.gov) if student has a PIN, or • Submit documentation to school’s financial aid office

37. Where Do I Go From Here? • Obtain and review admissions and financial aid web sites and materials for each school to which you are applying • Meet all application deadlines • Complete FAFSA and other application materials, such as College Scholarship Service’s CSS/PROFILE application, if required by school or state agency • Submit all requested follow-up documents • Investigate other sources of aid

38. But, Avoid Being Scammed Visit these websites to check legitimacy of scholarship search services or individuals, information about financial aid scams, and tips to avoid being scammed : • U.S. Department of Education:www.studentaid.ed.gov/students/publications/lsa/index.html • Federal Trade Commission: www.ftc.gov/bcp/conline/publs/alerts/ouchart.htm • Better Business Bureau: www.bbb.com

39. Private Scholarship Search Great Way to Find Additional Money for College! www.fastweb.com

40. Good Luck!

41. Presented by:Walker SelfAssistant Director of Financial Aid for Undergraduate AdvisingSouthern Methodist University214-768-3794mself@smu.edu