Financial Aid 101: A Guide to Financial Aid and Scholarships

1. Financial Aid 101:A Guide to Financial Aid and Scholarships Presented by Bonnie McCarty, Assistant Director of Scholarships, MTSU

2. Applying for Financial Aid

3. What is financial aid? • Money to pay for college or career school • Grants • Loans • Work-study • Scholarships

4. Federal Student Aid Requirements To be eligible, a student must be… • A US citizen or permanent resident • A High school graduate or GED holder • Pursuing an eligible degree or certificate program • A person with a valid Social Security number • Registered for Selective Service (males only) • Making satisfactory academic progress (i.e., Passing enough classes to show progress toward degree) These rules apply to most types of state and institutional aid also, and may apply to private aid.

5. FAFSA: Free Application for Federal Student Aid • Application for federal and state aid • Collects information about household income and assets, family size, and number in college • Used to determine eligibility for need-based aid • Required for students to receive grants, loans, the lottery scholarship, and other types of state and federal aid • May also be required for some types of institutional scholarships

6. FAFSA: Free Application for Federal Student Aid • Apply online at www.fafsa.ed.gov • Prepare FAFSA worksheet • Student and parent need PIN • Review answers carefully! • Reapply every year using renewal form

7. When to File Your FAFSA Available on January 1 • Submit as soon as possible after January 1 to receive need-based grants • Submit by May 1 if not expecting to receive need-based grants Tips • Use www.fafsa4caster.gov to get an estimate of expected financial aid • Available at all times; you don’t have to wait until Jan 1! • Be sure to file actual FAFSA; 4Caster is just an estimate. • Watch out for FAFSA deadlines listed in scholarship applications. • Use estimated income and file early!

8. Estimating Your Income • Use 2009 tax return and final 2010 pay stubs to estimate total income & taxes • When 2010 tax return is completed, compare with estimated info on FAFSA • If estimate was correct, make no changes • If estimate was incorrect, contact Financial Aid Office at school of choice; they will… • Instruct you to correct the FAFSA • OR Have you submit the tax return for them to make the correction on the FAFSA • OR Determine that no corrections are needed

9. College Goal Sunday Free Help with Filing Your FAFSA! • Free help with filing FAFSA! • January 31 OR February 13 • 35 sites around Tennessee • Register at www.tn.gov/CollegeGoalSunday • More info at www.mtsu.edu/financialaid/cgs.shtml • If possibly eligible for grants, file FAFSA in early January. Don’t wait for College Goal Sunday—may be too late!

10. Student Aid Report • Summary of the info on your FAFSA • Sent appx one week after FAFSA is filed • By email, if email address is provided • By mail, if email address is not provided • Comments section should be checked carefully, and any issues should be addressed as soon as possible

11. Student Aid Report • Expected Family Contribution (EFC) • Ranges from 0 to 99,999 • Lower number = higher financial need • Used to determine your eligibility for need-based aid • EFC does not correspond to particular income amount • The formula considers many factors, including income, taxes paid, household size, number in college, etc.

12. There’s a 1 in 3 chance your FAFSA will be selected for verification. Be sure to watch for information from your school, just in case! Verification • Required for 30% of FAFSAs by federal law • FAFSA is checked for accuracy • Must submit tax documents and other paperwork • Submit by June 1 for best results

13. How much federal student aid can I get? • Financial Need • Cost of Attendance budget • Tuition • Books • Room and Board • Travel • Miscellaneous

14. What happens next? • Award Letter • How much aid you can get at that school • Often sent by email to student’s school email account • Should include instructions on how to accept aid

15. What happens next? • Receiving your financial aid • Institutional charges paid first • Refund issued for remaining credit balance • Use refund to purchase books and supplies, pay for living expenses, and cover other indirect educational costs • Above info is applicable at most schools; check with your schools of interest about their aid policies.

16. Questions about applying for aid?

17. Types of Federal Aid

18. Federal and State Grants • Do not have to be repaid • Must have financial need according to FAFSA • Pell Grants are guaranteed for eligible students • Other types of grants have limited funding • File FAFSA early to qualify! • Some grants have academic requirements

19. Federal and State Grants • Examples: • Pell • Federal grant • $500-5500 • EFC of 0-5273 in 2010-2011 (may vary in future years) • Guaranteed for eligible students • SEOG • Federal grant • Amount varies, discretion of school • Not guaranteed—Schools may only be able to award 10-20% of all eligible students • TSAA • State grant • $1000-4000 (depending on school type) • Not guaranteed—Funds may run out in mid-January!

20. Federal Work-Study • Receive wages for hours worked • Must have financial need according to FAFSA • Very limited funding, few positions available at most schools • Priority generally given to returning students with FWS positions in current year • School may require interested students to submit FWS application by certain date • If eligible for Pell Grant, check with schools of interest to ask about application requirements • Other jobs outside FWS program are probably available on-campus • Check with school’s career center or individual departments

21. Types of Loans:Stafford Loan • Federal student loan which must be repaid • Award Amount: • $5500-7500 per year, depending on grade level • Amount isn’t based on financial need • Repayment: • Begins 6 months after graduation • Generally completed within 10 years

22. Types of Loans:Stafford Loan • Subsidized Stafford Loan • $3500-5500 per year, depending on grade level • No interest while in school • Must have financial need • Amount is based on remaining financial need after grants, scholarships, and other resources (e.g., tuition discounts) • Unsubsidized Stafford Loan • $2000 per year for dependent students • Interest accrues while in school • Available to all students, not based on financial need

23. Types of Loans:Stafford Loan Why should I consider a Stafford Loan instead of a private loan? • Payments deferred while in school • May be interest-free while in school (if subsidized) • May have lower interest rate • Does not require credit check or cosigner • Part of loan may be forgiven for public service (e.g., nurses, teachers)

24. Types of Loans:Loan Forgiveness Programs • “Grant”-Type Programs: • Examples: Teach Grant (federal), TN Teaching Scholars Program, TN Rural Health Program • Available to education, healthcare, and certain service industry majors • Must meet stringent service requirements or repay entire “grant” (plus backdated interest in most cases) • Stafford/Perkins Programs: • Borrow Stafford or Perkins Loan • Begin repaying loan as normal • Have portion of loan forgiven after meeting service requirement for given number of years

25. If parents apply for a PLUS Loan but are denied, the student may be eligible to borrow additional Stafford Loan funds of $4000 or $5000 for the year. Types of Loans:PLUS Loan • Federal parent loan which must be repaid • Award Amount: • Depends on student eligibility and lender approval • Credit check is required • Repayment: • Repaid by parents • Deferment available while student is enrolled at least half-time • Completed within 10 years

26. Questions about federal and state aid?

27. Scholarships from the State

28. State Scholarships • Examples: Lottery, Byrd, McWherter • Most require online application • Deadlines vary • www.tn.gov/CollegePays/

29. Tennessee Education Lottery Scholarship Program • HOPE Scholarship • The primary scholarship in the lottery program • 21 ACT OR 3.0 GPA • ACT must be taken before student begins college • Cumulative weighted GPA through end of high school • GPA is only considered if student attended eligible high school; home school students must qualify on ACT • $2000 per year at 2-yr school • 4000 per year at 4-yr school

30. Tennessee Education Lottery Scholarship Program • Supplements • General Assembly Merit $1000 • 29 ACT AND 3.75 GPA • Homeschool: 29 ACT AND 12 hours of dual-enrollment credit with 3.0 GPA • Aspire Supplement $1500 • $36,000 or less Parent AGI • Can receive one supplement at a time, not both

31. Tennessee Education Lottery Scholarship Program • HOPE Access Grant • 18 ACT AND 2.75 GPA AND $36,000 or less Parent AGI • Not available to homeschool students • $1750 for 1 year at 2-yr school • $2750 for 1 year at 4-yr school • Can qualify for full TELS award if 2.75 GPA after 24 hours

32. Tennessee Education Lottery Scholarship Program • Meet academic requirements • Tennessee resident for 1 year • US citizen/eligible non-citizen • Graduate from eligible Tennessee high school • Or meet alternate academic requirements for other school types (e.g. home school) • Submit FAFSA by September 1 (by February 1 for spring enrollees)

33. Wilder-Naifeh Technical Skills Grant • Available at TN Technology Centers • Public technical/vocational school • 26 locations across the state • $2000 per year • Tennessee resident for one year • Submit a FAFSA by September 1 • Not limited by age or academics!

34. Robert C. Byrd Honors Scholarship • $1,500 per year • Can be used at any eligible college • 3.5 GPA, or 3.0 GPA and 24 ACT (1090 SAT) • Random selectionamong eligible applicants • Deadline: March 1 • Apply at www.tn.gov/CollegePays/

35. Ned McWherter Scholars Program • $6,000 scholarship ($3000 from state, $3000 from school) • Attend an eligible TN school • 3.5 GPA and 29 ACT (1280 SAT) • US citizen and TN resident • Application deadline: February 15 • Apply at www.tn.gov/CollegePays/

36. Questions about state scholarships?

37. Institutional and Private Scholarships

38. Institutional Scholarships • Academic Scholarships • Usually based on GPA and ACT/SAT • May consider other factors • May require scholarship application • May have deadline in December or earlier • Amounts, requirements, application procedures, and deadlines vary widely. • Most scholarships available only to students beginning in the summer and/or fall semester. • Information should be available on the school’s website.

39. Institutional Scholarships • Foundation/Endowed Scholarships • Funding provided by private donors such as alumni • Major, residency, occupation of parents, or other factors • Most scholarships available only to students beginning in the summer and/or fall semester. • Application deadline generally between December and February

40. Institutional Scholarships • Departmental Scholarships • Funded from a department’s budget • For students in particular major or minor, or in certain organization • Examples: Band, ROTC, Athletics • Usually includes service requirement • Contact departments of interest for more information

41. Private Scholarships • Look for free search websites • Apply, Apply, Apply! • Watch for applications with essays —may have less competition • Emphasize your leadership, special skills and qualities, and contributions to your community. • Visit our scholarship website at http://www.mtsu.edu/scholarships/private_scholarships.shtml for more information.

42. Scholarship Notes • Beware of scams!! Don’t pay money to make money! • Ask employer or parent’s employer • Tuition discounts for state employees

43. Questions about institutional or private scholarships?

44. For More Information College For TN: http://www.collegefortn.org/ Click on “Financial Aid Planning” for many resources! FinAid: www.finaid.org Great info on financial aid and how it works! MTSU Financial Aid Office: www.mtsu.edu/financialaid www.mtsu.edu/scholarships