Start Your College Financial Aid Process NOW

As you are excitedly exploring college websites and imagining yourselves as incoming freshmen next year on the campuses of your choice, many of you (and your parents!) are probably also concerned about the rising cost of college attendance.

There are two options that can help families in facing the cost of college – merit scholarship aid and need-based financial aid. Students/families should consider applying for both. Merit scholarships are awarded to students based on their talents and not on financial need. These talents may include athletics, academics, musical skills or commitment to service. Merit-based money is a measure of how much a college would like a student to attend and is unaffected by the wealth or the need of the student’s family. Many of the most selective private colleges, however, do not award any merit-based aid. Need-based aid is based on a calculation of a family’s demonstrated need. In other words, the cost of attending a college minus the estimated contribution a family can make to cover that cost (EFC) = demonstrated need.

If you think you will need financial assistance in order to attend the college of your choice, there are things you and your parents should do now to prepare for the process of applying for financial aid.

  1. Start gathering and organizing your financial documents and tax information now. Beginning in 2016 for aid applications for the 2017-2018 award year, families will use the prior prior year (PPY) income and tax return information. This is great news, since most families should have their 2015 tax returns already submitted. Use this 2015 income and tax return information on the Net Price Calculators described below and to complete the FAFSA and CSS Profile in a timely manner.
  1. All colleges and universities are required to put a Net Price Calculator on their websites to help families calculate their estimated family contribution (EFC), given the specific costs of that institution. You can also find a general net price calculator on the College Board’s website at http://netpricecalculator.collegeboard.org/.
  1. The Free Application for Federal Student Aid (FAFSA) is the online application used by U.S. citizens and permanent residents to apply for financial aid from the U.S. federal and state governments. It is used by colleges and universities to distribute need-based financial aid. It is also used by many institutions to award scholarships and merit-based aid. It is important to complete the FAFSA even if you don’t think you will qualify for financial aid! 

    International students are not eligible for the U.S. government aid programs. However, many schools will ask international students to submit a FAFSA so that they may use the data for assessing financial need. See eduPASS (http://www.edupass.org/finaid/fafsa.phtml) for more information.Beginning in 2016, the FAFSA will be available starting October 1. Complete the FAFSA as soon as possible after October 1. You can download instructions, worksheets and other information about completing the FAFSA at https://studentaid.ed.gov/sa/resources#complete. The switch to PPY data will allow most American families to use the IRS Data Retrieval Tool within the FAFSA, thereby simplifying the application process. Information from the parents’ PPY tax return (normally already submitted to the IRS – 2015 return in this case) would be downloaded and automatically populate the FAFSA. If your student is applying Early Decision (ED), you will likely need to submit the FAFSA at the same time or shortly after the ED application has been submitted. Check each college’s website for deadlines.

  1. Check to see if the institutions on your list require the CSS Profile, in addition to the FAFSA. There are about 200 colleges (mostly highly-selective private colleges) that use this form, which is longer and more complex than the FAFSA. Both U.S. and international students may complete the CSS Profile. We recommend printing out the CSS Profile worksheet (accessible once you establish a CSS Profile account) and filling it in by hand, before transferring the data to the online application. The CSS Profile is also available starting October 1 and will use PPY income and tax information like the FAFSA. If your student is applying Early Decision (ED) to one of the institutions requiring the CSS Profile, you will likely need to submit the CSS Profile at the same time or shortly after the ED application has been submitted. Check each college’s website for deadlines.
  1. If you think you will need assistance with FAFSA or CSS Profile preparation, contact a financial aid expert EARLY, preferably in the Fall and definitely not last minute!
  1. Start exploring scholarship opportunities, both locally and nationally. These are sources of funding that are not administered by colleges but rather by other private organizations, each with its own application process and eligibility criteria. Families should not pay for any of these, nor pay anyone to search them out! Check out this website: http://www.college-scholarships.com/free-scholarship-searches/. Before you spend lots of time applying for scholarships, check with the colleges on your list. Many schools will deduct your scholarships from your awarded financial aid package.

This process can feel overwhelming….. I know, because I have completed the process for both my children! But by starting the process now, getting organized, and having a frank discussion with your family about expectations and financial realities, you will be ready to complete all the relevant forms when the time comes. And, when you have completed the paperwork, reward yourself for your accomplishment!

Written by Carolyn Stewart, Director of Communications

Important Changes to the Financial Aid Process

For many families, one of the most stressful aspects of the college application process is filling out financial aid forms.  Recent changes to both the Free Application for Federal Student Aid (FAFSA) and CSS Profile should make the process somewhat easier starting October 2016, but if your student is a current high school senior, college freshman or college sophomore, there are some things to consider before the end of 2015.

Currently, the CSS Profile becomes available on October 1 and the FAFSA goes live on January 1. Parents must complete these online forms using prior year financial data. (So, for students beginning college in the 2016-2017 academic year, this would be 2015 data.)  This has meant that parents of college applicants have had to estimate tax income information in order to meet the financial aid application deadlines.

This autumn, changes were announced for both the FAFSA and CSS Profile.  Beginning in 2016 for aid applications for the 2017-2018 award year, families will use the prior prior year (PPY) income and tax return information, and both forms will be available on October 1, 2016.  This means that parents of students who will be in college in the fall of 2017, for example, will use their 2015 federal tax return to complete the FAFSA and CSS Profile.

This will make the financial aid application process easier for the following reasons:

  • PPY will allow students to file their FAFSA and CSS Profile much earlier and align more closely with traditional application process deadlines.
  • PPY will allow most American families to use the IRS Data Retrieval Tool within the FAFSA, thereby eliminating the need for parents to estimate income and tax information and decreasing the need for additional documentation. Information from the parents’ PPY tax return (already submitted to the IRS) would be downloaded and automatically populate the FAFSA.
  • PPY may enable families to receive notification of financial aid packages earlier, which will provide more time for students and families to assess and compare packages and determine how they will pay their Expected Family Contribution (EFC).

So why is this change important now, when it doesn’t take effect until October 2016?

Because of the timing of the change, parents with current high school seniors, college freshmen, and college sophomores will complete the FAFSA and CSS Profile using 2015 financial data TWO YEARS IN A ROW.  This means now is the time to look at your 2015 data carefully and see what steps you can take to lower your expected family contribution by reducing parental income and/or assets or deferring decisions that would inflate your income and/or assets.  Consider the timing of a bonus, distributions from your retirement plans, realization of capital gains from selling assets, and purchase of large item for which you have been accumulating funds.

Here are some articles to read for further information:

Get Ready for FAFSA

The new FAFSA process and college costs

 

Things to do NOW to Prepare for the Upcoming College Financial Aid Process

what you can do now to prepare for the financial aid application processAs you are excitedly exploring college websites and imagining yourselves as incoming freshmen next year on the campuses of your choice, many of you (and your parents!) are probably also concerned about the rising cost of college attendance.

There are two options that can help families in facing the cost of college – merit scholarship aid and need-based financial aid. Students/families should consider applying for both. Merit scholarships are awarded to students based on their talents and not on financial need. These talents may include athletics, academics, musical skills or commitment to service. Merit-based money is a measure of how much a college would like a student to attend and is unaffected by the wealth or the need of the student’s family. Many of the most selective private colleges, however, do not award any merit-based aid. Need-based aid is based on a calculation of a family’s demonstrated need. In other words, the cost of attending a college minus the estimated contribution a family can make to cover that cost (EFC) = demonstrated need.

If you think you will need financial assistance in order to attend the college of your choice, there are things you and your parents should do now to prepare for the process of applying for financial aid.

  1. Start gathering and organizing your financial documents and tax information now. Based on my experience applying for aid, I would suggest that parents print out the Federal Form 1040 or 1040EZ (whichever they will ultimately complete) and begin filling it in now, making estimates for the year based on finances to dat and/or your previous year’s taxes. This will help you use the Net Price Calculators described below and complete the FAFSA and CSS Profile in a timely manner.
  1. All colleges and universities are required to put a Net Price Calculator on their websites to help families calculate their estimated family contribution (EFC), given the specific costs of that institution. You can also find a general net price calculator on the College Board’s website at http://netpricecalculator.collegeboard.org/.
  1. The Free Application for Federal Student Aid (FAFSA) is the online application you will use to apply for the federal student aid programs offered by the U.S. Department of Education. It is used by colleges and universities to distribute need-based financial aid. It is also used by many institutions to award scholarships and merit-based aid. It is important to complete the FAFSA even if you don’t think you will qualify for financial aid! 

    Complete the FAFSA as soon as possible after January 1, even if you have not yet submitted your tax return. This should be relatively straightforward if you have completed an estimated Form 1040. You can download instructions, worksheets and other information about completing the FAFSA at https://studentaid.ed.gov/sa/resources#complete.

  1. Check to see if the institutions on your list require the CSS Profile, in addition to the FAFSA. There are about 200 colleges (mostly highly-selective private colleges) that use this form, which is longer and more complex than the FAFSA. We recommend printing out the CSS Profile worksheet (accessible once you establish a CSS Profile account) and filling it in by hand, before transferring the data to the online application. The CSS Profile is available starting October 1. Again, if you have prepared an estimated Form 1040 early, it will make completing this online application much easier. If your student is applying Early Decision (ED) to one of the institutions requiring the CSS Profile, you will need to prepare the CSS Profile shortly after the ED application has been submitted.
  1. If you think you will need assistance with FAFSA or CSS Profile preparation, contact a financial aid expert EARLY, preferably in the Fall and definitely not last minute! We highly recommend Paula Bishop, a CPA and college financial aid advisor – www.paulabishop.com.
  1. Start exploring scholarship opportunities, both locally and nationally. These are sources of funding that are not administered by colleges but rather by other private organizations, each with its own application process and eligibility criteria. Families should not pay for any of these, nor pay anyone to search them out! Check out this website: http://www.college-scholarships.com/free-scholarship-searches/. Before you spend lots of time applying for scholarships, check with the colleges on your list. Many schools will deduct your scholarships from your awarded financial aid package.

This process can feel overwhelming….. I know, because I have completed the process for both my children! But by starting the process now, getting organized, and having a frank discussion with your family about expectations and financial realities, you will be ready to complete all the relevant forms when the time comes. And, when you have completed the paperwork, reward yourself for your accomplishment!

Written by Carolyn Stewart

(c) College Goals LLC 2015

Notes for Families who are Applying for Financial Aid

by Carolyn Stewart, Director of Communications, College Goals, LLC

FAFSA stands for “Free Application for Federal Student Aid.”  Completing the FAFSA online is the first step that students and families must take toward receiving financial aid for college, career school, or graduate school. There is no income cut-off to qualify for federal student aid. Therefore, don’t make assumptions about the support that you and your family may be eligible for, nor about what you and your family will be expected to contribute—fill out the application and find out: www.fafsa.gov.

Need-based aid is normally calculated based on “cost of attendance” (tuition/fees, room and board, transportation, etc.) minus “expected family contribution” (EFC) determined by your responses to the FAFSA.  Many public and private colleges, and even private scholarships funders, also use FAFSA information to award the merit aid they have available.  Don’t miss out on these opportunities by not completing the FAFSA!

You should never have to pay to fill out the FAFSA form, so beware of any websites that want to charge you.  The FAFSA is available online every year starting January 1 at www.fafsa.gov.  Check with each of the colleges to which you are applying to determine if additional financial aid applications need to be completed, such as the CSS Profile or a college-specific financial aid supplement.  You can select up to 10 schools to receive your FAFSA information, again for free.

The U.S. Department of Education has developed some very helpful websites and tools to help you navigate the financial aid process:

  • Federal Student Aid: www.studentaid.gov – you can learn about how to prepare for college; what types of financial aid are available from the government and other sources; who gets aid; how to apply for aid and how aid is calculated; and how to manage any student loans you may receive as part of a financial aid package.
  • College Affordability and Transparency Center: http://collegecost.ed.gov/ — this site has many great features including the College Scorecard, Net Price Calculator Center and College Navigator.  With the College Scorecard, you can find out more about a college’s affordability and value, including cost, graduation rate, loan default rate and median borrowing.

Check out You Tube — http://www.youtube.com/FederalStudentAid — for short videos about the whole financial aid application process, including preparing for college, types of aid, who gets aid, the FAFSA, and more.

You can also “like” Federal Student Aid on Facebook, for regular updates, information and tips.

Applying for financial aid can be stressful for families.  Use these free government tools to help you navigate the system and answer any questions you have.  If the websites don’t provide the information you need, contact the Federal Student Aid Information Center by phone, email or live chat: http://www.fafsa.ed.gov/help.htm.