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Planning and Paying for College Grants, Scholarships, Loans and Other Money for College.

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Presentation on theme: "Planning and Paying for College Grants, Scholarships, Loans and Other Money for College."— Presentation transcript:

1 Planning and Paying for College Grants, Scholarships, Loans and Other Money for College

2 Welcome to this workshop on how to Fund Your Future. Content and workbooks for this workshop are provided courtesy of the California Student Aid Commission and ECMC. 2

3 Workshop Overview Financial aid basics Types of aid How to apply Free money Cal Grant deadline Loans Federal loans Private loans Repaying your loan Manage your money 3

4 Types of California colleges California Community Colleges (CCCs) California State University (CSU) University of California (UC) Independent and/or private colleges Career colleges Vocational/technical schools 4 In this workbook and presentation, college refers to any of these

5 10 important things to qualify 1.Submit the FAFSA 2.Submit any other applications* 3.Demonstrate financial need 4.Have a high school diploma or equivalent 5.Be a U.S. citizen or eligible noncitizen 6.California residency 7.Enroll in an eligible degree or certificate program 8.Maintain satisfactory academic progress 9.Have an SSN 10.Register with U.S. Selective Service (males 18-25) *and a verified GPA for a Cal Grant by March 2 5

6 Types of financial aid Grants are money you dont have to repay, typically based on financial need. Scholarships are free money, usually based on your area of study or merit. Work-study or student employment programsfederal and college. Loans are borrowed money that you must pay back, usually with interest. 6

7 Basic steps to financial aid Prepare for college Apply for financial aid Pay for college Manage your money 7 See the basic steps checklist on pages 2-3

8 Free money from the government Cal Grants Cal Grant A: up to $12,192 Cal Grant B: up to $1,551 first year, up to $13,743 thereafter Cal Grant C: up to $3,168 Federal Pell Grant Up to $5,550 a year Federal Supplemental Educational Opportunity Grant Up to $4,000 a year Federal TEACH Grant Up to $4,000 a year More information on pages 4-5 8

9 Special programs and work-study Fee waivers and other college-based programs See your college financial aid office Work-study Federal work-study College work-study Student employment programs 9

10 Other California aid programs UC Student Aid Average grant $14,000 State University Grant Full systemwide fees California Chafee Grant Up to $5,000 a year Child Development Grant Up to $2,000 a year California National Guard Education Assistance Award $1,551 - $12,192 Law Enforcement Personnel Dependents Grant Up to $13,743 a year 10 See pages 4-5 for requirements

11 Applying for financial aid Collect your information SSN, drivers license number, email address Your financial records Fill out the FAFSA on the Web Worksheet ( Helps you prepare for the real FAFSA so youll have everything you need 11

12 FAFSA on the Web Apply at Read all the instructions Name must match your SSN E-sign your FAFSA using your PIN You can receive a PIN instantly when you complete the FAFSA Add this email address to your contacts to ensure you receive it: Provide an email address to receive an estimate of your EFC instantly 12

13 FAFSA on the Web Print and keep a copy of the FAFSA you submit for your records Also keep copies of the financial information you used to complete the FAFSA Use your PIN to: check on the status make corrections to your FAFSA later 13

14 Free help with the FAFSA California Cash for College workshops January & February Help at Click on the Live Help button for help with the paper Phone: 1-800-433-3243 M-F til 9 p.m. Saturday til 3 p.m. 14

15 Calculating financial need Cost of attendance (COA) Each college has its own student budget, or COA, which includes tuition, fees, books, supplies, housing, food, transportation and personal expenses Expected family contribution (EFC) The amount of money the government believes you or your family could reasonably contribute toward your education Your demonstrated financial need Your COA - Your EFC = Your demonstrated financial need 15 More information on page 9

16 Applying for a Cal Grant Two forms, two steps Submit the FAFSA Submit verified Cal Grant GPA When you finish your FAFSA, look for the link to the California site to answer any questions about your Cal Grant application Some schools automatically submit GPAs electronically for their students If not, fill out the Cal Grant GPA Verification Form and give it to a school official for verification before mailing Available at Mail to the California Student Aid Commission by March 2 deadline 16

17 Tracking your Cal Grant Track your Cal Grant and/or California Chafee Grant application or award 24/7 access Secure account Make changes to your account Avoid delays in getting your grant – keep your account updated 17

18 Student Aid Report (SAR) The SAR is a report from the federal processor summarizing the information you provided on the FAFSA Receive within 72 hours if you submitted the FAFSA online (up to 2 weeks for paper) Review right away for accuracy Lists your EFC for the school year Located at the top of your SAR No dollar sign next to it (e.g., 02500) 18

19 Sample SAR email Includes a link to your individual SAR See example on page 13 19

20 Sample SAR 20

21 California Aid Report (CAR) If youre offered a Cal Grant, youll receive an email from the California Student Aid Commission called a CAR You must list a valid email address on your FAFSA so you can receive a CAR The CAR lists the tentative Cal Grant award amount If you did not get a Cal Grant, youll receive notification explaining why See sample CAR on page 13 21

22 Sample CAR See example on page 13 Access your CAR online at 22

23 Evaluate financial aid offers Compare offers Determine your net costs See worksheet on page 15 23

24 Cal Grants: free money! Up to $12,192 for college up to $3,168 for career or technical training Can be used at: University of California California State University California Community Colleges Most independent colleges Many career and technical schools You dont have to pay it back 24

25 When to apply for a Cal Grant In your senior year of high school Within one year after graduating from a California high school or receiving your GED As a California Community College transfer student, as long as you are under age 28 By the March 2 Cal Grant deadline 25

26 Cal Grant guarantee Youre guaranteed to receive a Cal Grant award if you: are a high school senior or recent graduate, apply by March 2, graduate from a California high school, meet income and asset ceilings meet all other eligibility requirements, and have financial need based on your college costs and your expected family contribution 26 More information on page 17

27 To qualify for a Cal Grant: Submit the FAFSA and your verified Cal Grant GPA by the March 2 deadline (see page 10) Be a U.S. citizen or an eligible noncitizen Be a California resident Meet any minimum GPA requirements Attend a qualifying California college Have financial need based on your COA & EFC Meet income and asset ceilings (see pages 7 & 18) Be enrolled at least half time Pass the CA High School Exit Exam (CAHSEE) 27

28 Financial aid for specific populations Athletes California Conservation Corps Students with dependents Students with disabilities Foster Youth California Chafee Grant College-based tuition waivers/scholarships Orphan Foundation of America Military and their dependents California National Guard 28

29 AB 540 – Undocumented students Undocumented or underdocumented students may qualify for in-state tuition rates at UC, CSU and California Community Colleges Completed at least 3 years of high school in California and Graduated from a California high school or received your GED in California Check with your college admissions office Additional resources available at: 2010_Scholarship_list.pdf 29

30 California Dream Act of 2011 (AB 130) Undocumented/underdocumented students may also qualify for: Institutional scholarships Privately funded scholarships Must meet qualifications for AB 540 in-state tuition rates Check with your college admissions office More information on pages 9 & 22 30

31 California Dream Act of 2011 (AB 131) Signed into law October 8, 2011 Undocumented or other nonresident students may also qualify for Cal Grants and other applicable state aid The Board of Governors (BOG) Fee Waiver Program Institutional aid Students begin applying for Cal Grants in January 2013 (Note: This years seniors can apply next year) Check with your college financial aid office for more information about the BOG Fee Waiver (at community colleges only) and institutional aid timelines and processes 31

32 Money for future teachers Cal Grant A and B extended benefits Federal TEACH Grants Up to $4,000 a year for tuition APLE: Californias Assumption Program of Loans for Education Assumes up to $19,000 of student loan debt in return for four years of teaching service Federal Loan Forgiveness for Teachers Forgives federal Stafford loan debt Federal Perkins Loan Forgiveness Federal Pell Grants May be used to attend a teacher credential program Teach for America Up to $5,350 a year to repay loans plus other benefits SNAPLE: Californias State Nursing Assumption Program of Loans for Education Assumes up to $25,000 of student loan debt in return for teaching service See chart on page 22 32

33 Other ways to pay for college Private scholarships National Merit Scholarships Community service The military Credit for experience Earn credit in high school Cooperative education Part-time work Start at a community college ScholarShare college savings plan Company-paid education Tax benefits Jobs that help you repay loans 33 See pages 23-25 in your workbook

34 Federal loans Federal Stafford loans Subsidized Stafford loans Based solely on demonstrated financial need The federal government pays the interest while you are in school Unsubsidized Stafford loans All eligible students can receive them, regardless of income or assets Youre responsible for paying the interest while in school 34

35 Stafford loans Want to knowDetails How to get one First submit the FAFSA; your colleges financial aid office will contact you later to complete the required steps, including signing a master promissory note and completing loan counseling Interest rate Loans disbursed between July 1, 2012 and June 30, 2013 have a fixed 6.8 percent interest rate for the life of the loan FeesA 1 percent loan fee will be deducted from each loan disbursement Enrollment requirementAt least half time How youll receive loan funds Funds are sent directly to your college to pay for tuition, fees, room and board (if applicable); the remainder will be issued to you by your college Repayment beginsSix months after you graduate, leave school or enroll less than half time 35

36 How much can you borrow? It depends on: Your colleges cost of attendance (COA) Your expected family contribution (EFC) How many years youve been in school Whether youre a dependent or an independent student, and How much other financial aid you receive. Your loan and any other financial aid you receive, including private aid, cannot be more than your cost of attendance 36

37 Federal PLUS loans Enable your parents or stepparents (whose information is reported on your FAFSA) to borrow up to the total cost of your undergraduate study Less any other aid you may receive Legal guardians cannot borrow PLUS loans for your study 37 See chart on page 28

38 Private loans Often carry higher interest rates and fees than federal loans May have less attractive repayment terms Typically the interest rates are variable Rates can change month to month Usually based on your credit rating and debt-to-income ratio Not based on financial need May require a co-signer 38

39 What it means to accept a loan Accepting responsibility for repaying the money you borrow Before you borrow, ask: Is the college or program a good investment? Does your loan make good financial sense? Are there other options? What is the true cost of your loan? Can you repay it? What are your rights and responsibilities? 39

40 Repaying your loan 40

41 Making repayment easier Pay as you go Sign up to have your loan payments taken directly from your bank account See if loan consolidation makes sense Let your loan servicer know if you cant make your payments Dont default 41

42 Sample financing plan 42 Student: Serena Age: 18 Status: Single (dependent on parents) Housing: At home with parents Parent income: $40,000 (A) 2011-12 CSU cost of attendance (living at home with parents): Fees/tuition: $5,472 Books/supplies/room/board/misc. expenses: $9,756 $15,228 (B) Grant assistance total Serena is eligible for grant assistance based on her familys financial resources. The campus aid office pulls together grant aid from a variety of sources, including federal Pell Grants, state Cal Grants and the CSUs own grant funding. $9,680 (A - B) = Net cost to family The net cost is the amount that Serenas family must pay after need-based grants are taken into account. $5,548 MANAGING THE NET COST Parents and students work together to cover the net cost using resources provided by the college, including parent and student education loans, part-time work during the academic year, and savings from summer earnings. The net cost is not due all at once. Many costs, such as living expenses, are incurred over time. Here is a sample of how Serenas family might cover her net cost. Serenas parents Combination of current earnings, savings or a parent loan: Serenas parents would be expected to contribute $926 for the year. $926 Serena Student part-time work during academic year: Student education loans: Savings from summer jobs: $0 $2,981 $1,641

43 Net price calculators Congress passed a law requiring all colleges to offer a net price calculator on their websites Allows prospective students to figure out how much it will cost them to go to college Compare net price of one school to another school 43

44 Spending smart Get organized Set up separate files Keep them in a safe place Create a monthly spending plan and stick to it Avoid using credit cards Start saving No matter how little, set aside something every month 44

45 Useful websites ACT: AmeriCorps: Cal Grants: California Cash for College workshops: College Board: California colleges: College Savings Plan: ECMC: FAFSA: Federal Financial Aid: 45

46 Thank you © California Student Aid Commission, 2011. © ECMC, 2011. All rights reserved.

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