Financial Aid Night

1. Financial Aid Night Financing Education Beyond High School

2. Today’s Agenda • Application Process • How Financial Aid is Determined • Types of Aid • Questions

3. How Do I Apply for Financial Aid? • Complete the Free Application for Federal Student Aid (FAFSA) • Complete school’s Financial Aid Application (if applicable) • Meet Priority Deadline • Apply for Scholarships • Contact school directly if you have Special Circumstances

4. Free Application for Federal Student Aid (FAFSA) • Collects Family’s Personal and Financial Information used to Calculate EFC • Federal Central Processor Computes all Data • Apply Every Year • Takes 1-3 Weeks to Process—Apply Early • Generates Student Aid Report (SAR) 2011-12: 18 million FAFSAs filed; 5% increase over 2010-11 College Scholarship Service: CSS Profile • File in Fall of Senior year; not free* • Carleton, St. Olaf, Macalester, Gustavus

5. PIN Registration www.pin.ed.gov • Electronic Signature • Student and Parent Must Have One • Parent Can Use Same PIN for Multiple Children • Access to Loan Info (National Student Loan Database System)

6. Where to Start… • FAFSA—Free Application for Federal Student Aid • www.fafsa.gov • Be Prepared: • Adjusted Gross Income • Wages • Federal Taxes paid • Tax Deferred income • Investment info • Savings/Checking balances • You CAN estimate your income!!

7. FAFSA – Student Information • Social security number • Date of birth • The name entered for the student MUST match the name on their social security card. • Selective Service (male students only)

8. FAFSA – Student Information • Students must file a renewal FAFSA every year in order to continue financial aid • Make sure you complete the correct aid year’s • FAFSA: 2014-2015

9. FAFSA – School Information • Enter the college school codes • You can either enter the number provided by the school or use the “search” function • Housing choice requested for each college

10. FAFSA – Student Information • Several questions determine student dependency information for FAFSA purposes. • In general, students under the age of 24 are considered to be dependent for FAFSA purposes.

11. FAFSA – Student Information • Students will be prompted to answer the same tax and asset information as parents. • Students who filed taxes can also use IRS-Data Retrieval (DRT) • Income Estimator

12. FAFSA – Parent Information • Dependent students must provide parent information on the FAFSA • If parent information is not available, student should contact the college to proceed.

13. FAFSA – Parent Information • If student’s biological parents are divorced, only list household tax information for custodial parent. If joint custody, include information where student lives more than 50% of the time. • New 2014-15—Unmarried parents who live together need to report both their incomes to FAFSA; includes same sex couples who are legally married and/or who has adopted the student • If custodial parent is remarried, both parent and step-parent information is required for FAFSA purposes. • If your student has a child of her/his own and both live with you, you may still be required on the FAFSA

14. FAFSA – Parent Information • “Household size” includes a help button to determine who should count as household members • Parents in college do NOT count as # in college for the student’s FAFSA

15. Data Retrieval Tool (DRT) • Use the IRS Retrieval--available last week in Feb! • Eligible to be used when taxes are filed online in advance of at least 3 weeks; paper could be 6-10 weeks • Does NOT populate wages, tax deferred or investment information • Address on FAFSA must match address on tax return • You can return to your FAFSA after you file taxes and use DRT!

16. Data Retrieval Tool (DRT) • Are you married, but filed separate taxes from your spouse? • File a Puerto Rican tax return? • Filed an Amended tax return? • Do not have a valid Social Security Number • Only recently filed (last 3-4 weeks) online, (8 – 10 weeks) for paper filings • Do not owe money back to the IRS • If you say no to any of these, you should use DRT!

17. Data Retrieval Tool (DRT)

18. FAFSA – Parent Information • Income tax: • 1040, line 55 1040A, line 35 1040EZ, line 10 • Exemptions are found on 1040 or 1040A, line 6d • Untaxed Income: Payments to tax-deferred savings found on W-2, boxes 12a-d, codes D-H & S

19. FAFSA – Parent Information Asset FAFSA information requested: • Amount in cash, checking and savings • Net value of investments (value minus debt): • DO NOT INCLUDE: Value of family home, a farm the family lives on, family-owned business with fewer than 100 employees, value of retirement/pension plans in a qualified retirement account • INCLUDE: Net value of rental properties, net value of investment farms, investments, college savings plans (529 in parent or student’s name), etc… There is an automatic asset protection built into the federal formula— the average amount calculated from parents’ assets is 6%.

20. FAFSA – Parent Information Add’l Financial Information and Untaxed Income that must be reported: • Education Credits • Total child support paid in that calendar year • Taxable combat pay or special combat pay (would be included in your AGI if taxable) • Parents’ own student grants and scholarship if reported as part of the parents’ AGI • Child support received that calendar year for all in the household • Other untaxed income (first time homebuyers tax credit)

21. FAFSA – Signature Page • FAFSA must be signed by both student and a parent • Any FAFSA changes must be signed by both student and a parent • FAFSA may be signed with pin or signature page – pin leads to significantly faster processing

22. Success!

23. Verification • Roughly 1 out of 4 FAFSAs will be randomly selected for “verification” • Student and Parent must provide official tax transcript to the school (not copy of tax return) or use DRT (Data Retrieval Tool) • www.IRS.gov (Get a transcript) –OR-- call 800-908-9946 (2-4 weeks) • Must also submit the Federal Verification Worksheet (provided by the school) • If needed for eligible non-citizenship documentation, student must bring in original for FA office to copy

24. Expected Family Contribution (EFC) • Parent Income • Student Income • Untaxed Income • Family Assets • Family Size • Number Attending College • Student and parent contributions are determined by the federal formula (FAFSA application) • Colleges use your EFC to determine your family’s aid eligibility at their school

25. Cost of Attendance • Tuition and Fees • Room and Board • Books and Supplies • Transportation • Miscellaneous Personal Expenses

26. FAFSA Determines Your Expected Family Contribution (EFC) Cost of Attendance (COA) -- EFC____________________ =Eligibility for need-based financial aid The COA is different at each school, but a student’s EFC stays the same. A student’s need will be different from school to school.

27. Cost of Attendance vs. Direct Costs Cost of Attendance (COA): Tuition @ fulltime (16cr) + Fees + Room + Board + Transportation* + Books & Supplies* + Misc. Expenses* = Cost of Attendance *Estimated; you may not actually pay this amount Direct Costs (DC): Tuition @ fulltime (16cr) + Fees + Room + Board = Direct Costs These are costs that are set and standard that students will be charged Net Price Calculators: All colleges must have one; be aware of COA vs. DC for actual costs

28. 1 X 2 Y 3 Z EFC EFC Cost of Expected Family Need Attendance Contribution (Variable) (Constant) Need Varies Based on Cost (Variable)

29. Types of Financial Aid • Grants • Scholarships • Loans • Student Employment Where does it come from? Federal and State Government, Schools, Employers, and Other Public and Private Sources like Clubs and Organizations

30. Federal Grants • Federal Pell Grant: given to students with exceptional financial need; annual awards range from $4,574-anticipated maximum $5,645; maximum lifetime limit of 12 semesters of enrollment (based on 13-14) • Federal SEOG Grant: limited funding; priority given to students with exceptional need; each school can determine how much they will award • The Teacher Education Assistance for College and Higher Education Grant (TEACH): must meet certain pre-requisite academic requirements; must declare Education as a major; must work as a fulltime teacher in a designated area after graduation. See Financial Aid Counselor for details.

31. State & Institutional Grant Programs • Minnesota State Grant: Must be a MN resident attending eligible MN school; award to students from low to moderate income families; annual awards up to $10,450 (13-174); maximum lifetime limit equal to 4 years of enrollment • FAFSA will have a MN State Grant Questionnaire link if you indicated your legal state of residency is MN • Minnesota GI Bill: Eligible MN veterans who served on or after Sept. 11, 2001; full-time undergraduates may be eligible to receive up to $1,000/semester or term and part-time students may be eligible for $500/semester • Institutional Grant: College or university funds award to students with financial need

32. Search for Scholarships • Typically awarded based on merit, not need • Where to look: • On the web • Your college(s) of choice • HS counselor; Guidance Office or Career Center • In the community: church, civic, and business organizations • Parent employer

33. Loans • Federal Perkins Loan: 5% fixed interest; no fees; interest and repayment begin after school • Federal Stafford/Direct Loan: Loans awarded after July 1, 2013 will have an interest rate of 3.86%; 1.072% fee; repayment of principle begins 6 months after school ends/student withdraws • Subsidized: no interest charged while in school; interest will begin to accrue from the last date of attendance • Unsubsidized: interest accrues while in school • Federal Parent PLUS Loan: Parent borrows loan on behalf of dependent student; fixed interest rate 6.41%; 4.288% fee; repayment begins after disbursement (i.e. while student is in school) • Alternative/Private Student Loans: Variable interest rates and fees; can require cosigner

34. Student Employment • Retention • Flexible Hours • Spending Money • On-Campus or Non-Profit Organizations • Federal and State Employment is not used in Determining Student’s Contribution on next year’s FAFSA

35. Financial Aid Award A “package” is a combination of grants & scholarships, student employment, and/or low-interest student loans. Example: Total COA $16,000 (includes tuition, fees, room and board and estimated books, supplies and misc) Outside Scholarship: $1,000 Pell Grant: $2,200 MN State Grant: $3,612 Federal Work Study: $2,000 Federal Perkins Loan: $2,000 Federal Stafford Loan: $3,500 Total Aid $14,312 Family Contribution = $1,688

36. Where Can I Get More Information? • Federal Student Aid Info studentaid.gov • FastWeb Scholarship Search: www.fastweb.com • FinAid - The Financial Aid Information Page: www.finaid.org • Minnesota Office of Higher Education Student Website: www.getreadyforcollege.org

37. Financing Your FutureAn Investment in You! Mai NhiaXiong-Chan Director of Recruitment St. Catherine University mxchan@stkate.edu