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Paying for college Financial aid overview 2014-2015.

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Presentation on theme: "Paying for college Financial aid overview 2014-2015."— Presentation transcript:

1 Paying for college Financial aid overview 2014-2015

2 General principles Everyone qualifies for some form of financial aid Free assistance is available. –You don’t have to pay

3 What is financial aid? Grants Work-study Loans Scholarships Tuition waivers Tax credits and deductions These types of aid are based on a family’s financial situation, household size, and # of dependents in college. To be eligible for these, FAFSA must be completed. Scholarships can be merit-based, or based on achievement in other areas. When you file your federal income tax return you or your parents may qualify for certain deductions

4 Undocumented residents of Texas May qualify for Texas residency HB 1403 /SB 1528 In-state tuition State financial aid Not state loans Eligibility example Lived in Texas three years prior to graduation from a Texas high school Submit a FAFSA or TASFA College determines application The most important thing to remember is that a student does not have to be a U.S. Citizen to receive state financial aid. Each institution has its own procedures so contact the Financial Aid Office to find out what you need to do. Look at the College For All Texans website under “Residency” for more info.

5 The application: FAFSA Free Application for Federal Student Aid –Federal –State –Institutional* It’s a good idea to contact the schools you are interested in to see if they require additional information. The FAFSA may be the only application needed, but it is better to be safe than sorry!

6 The application: TASFA Texas Application for State Financial Aid –Lived in Texas three years prior to graduation or GED –In-state tuition –May qualify for some state aid Not state loans For undocumented students. Ask your college for assistanct. Submit this as soon as possible. TASFA is calculated by hand and takes much longer to process than FAFSA.

7 The FAFSA Students Social security number Completed IRS tax return W2 Record of untaxed income Record of investments Current bank statements Parents Completed IRS tax return W2 Record of untaxed income Record of investments Current bank statements Documentation Necessary to Complete the FAFSA

8 Student status Dependent Need parents’ information Not tax filing related Independent Do not need parents’ information –Have dependent(s) –Married

9 Student status Dependent If parents are divorced or separated –Use parent that lived with most or provided most support –If that parent is remarried use the spouses information also

10 FAFSA: common mistakes  Name does not match Social Security Card - exactly  Putting same amount for AGI and Income Tax  Not following up with correct tax info  Parents put their information in place of the student’s  Transposing numbers  Student status  Not signing it / Not submitting it

11 Notify student The process Submit FAFSA US Department of Ed (Calculates EFC) Student accepts offer School releases funds SAR to student School determines need Award letter to student

12 Types of aid Grants Work-study Loans

13 Grants Free money Need-based Examples: –Texas Equalization Grant (state) –Pell Grant (federal)

14 Work-study Students work to earn money Receive regular pay check Jobs Majority are on campus Flexibility Provide valuable experience

15 Federal loans Must be paid back Available for –Students Stafford –Subsidized –Unsubsidized –Parents PLUS Low interest rates Various repayment terms Deferments

16 Federal Stafford Loan Students Repayment starts six months –After graduation –Dropping below half time No credit check required

17 Federal Stafford Loan SubsidizedUnsubsidized Need-based Non need-based Interest Doesn’t accrue In-school Grace Deferment Interest Accrues but not required to pay Can be capitalized

18 PLUS Loan Parent borrows loan –For dependent child’s educational expenses Parent receives funds Parent responsible for payment Credit check required Repayment - 60 days after second disbursement Deferment –Student / parent in school

19 Special circumstances Changes in income –Death, disability –Unemployment, underemployment High medical/ dental expenses Dependency status Cost of attendance (COA) Other

20 Scholarships Free money Merit-based –Academic –Class rank or GPA –Test scores Special skills –Music –Drama –Athletics –Art

21 Scholarship tips Start early Local On-line Reapply

22 Scholarship tips Know the rules –Due date –Essays –Recommendation letters Send everything requested When possible get return receipt Proofread

23 Scholarship tips Avoid pitfalls Ignoring details Using the same essay Forgetting federal and state programs

24 Scholarship scams FTC cautions families to look for these signs Guaranteed or your money back Credit card or bank account Can’t get information anywhere else We do all the work Will cost some money Selected by national foundation

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