Workshop March 30 2017 Jane T Robbins Hope is not a plan Act with integrity and start early Oct 1 st FAFSA goes live Focus on Net Price when comparing award packages Have frank family discussion about college funding ID: 612912
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Slide1
College Funding and Financial Aid Workshop
March 30, 2017
Jane T. RobbinsSlide2
“Hope is not a plan”Act with integrity and start early (Oct. 1st FAFSA goes live)
Focus on Net Price when comparing award packagesHave “frank family discussion” about college funding before applying to schoolsInclude a “Financial Safety School” on your college listEFC is based on parents’ ability to pay, not
willingness to pay
Explore multiple financial aid options and
reapply annually
Big Ideas and Key Take-Aways
2Slide3
Funds provided to students and families to help pay for postsecondary education expenses
Two categories of financial aid:Need-based – financial considerationsMerit-based – talents, skills,
and achievements
(athletic, academic, artistic, leadership, or service)
What is financial
aid?
3Slide4
Primary responsibility to pay falls to familyFamilies contribute to extent
ableIncome and assets reflect financial strength Similar treatment for similar circumstancesExpect more from those with greater resourcesAid eligibility based on annual “snapshot”
Unusual family circumstances considered
What are the guiding principles of
need-based aid?
4Slide5
Gift Aid (“Free Money”)
Grants – Need-basedScholarships – Merit-based Self-Help
Loans – Need and non need-based
Employment – Work-Study
T
ypes of
F
inancial
A
id
5Slide6
SOURCE: The College Board,
Trends in Student Aid 2016, Figure 2A. Total Undergraduate Student Aid
by Source and Type (2015-2016)
6Slide7
Federal Government
Grants (Pell, SEOG, TEACH)Loans (Stafford, Perkins, Parent PLUS)Work-StudyState of Florida
Grants (FSAG, FRAG, First Gen. Matching Grant)
Scholarships (Bright Futures, teachers, minorities)
Colleges and Universities
Institutional grants and scholarships
Private Sources
Scholarships (civic organizations, religious groups, employers)
Sources of
F
inancial
A
id
7Slide8
“Financial Fit” must also be consideredKnow your financial situation
“Frank family discussion” regarding resourcesWho is paying, and how much?Are you willing to take loans or be employed?Understand “Total Cost of Attendance”
College costs and aid policies vary widely
Preliminary Planning:
Finding “Best Fit” Schools
8Slide9
Direct or “Hard” Costs
Tuition and feesRoom and boardIndirect or “Soft” CostsBooks and supplies
Transportation
Miscellaneous personal expenses
(computer, cell phone, travel, clothing, recreation)
What is included in
the Total Cost of Attendance (“TCA”)?
9Slide10
Amount family can reasonably be expected to contribute
Includes both parent and student contributions (income and assets)Stays the same each academic year (regardless of school) but may change from year to yearCalculated annually based on information provided on FAFSA
What is the Expected Family Contribution (“EFC”)?
10Slide11
Basic Formula
Total Cost of Attendance
- minus
Expected Family Contribution
=
Demonstrated
Financial Need
How is eligibility for need-based financial aid determined?
11Slide12
How do students apply for
need-based financial aid?FAFSA (Federal)Free Application for Federal Student Aid
Federal Methodology used to calculate EFC and eligibility for federal aid
CSS/Financial Aid PROFILE
College Board
Institutional Methodology used to determine institutional aid eligibility
At school’
s discretion:
Noncustodial Parent PROFILE
Tax returns and W-2 forms
Institutional Application
12Slide13
www.FAFSA.gov
13Slide14
Custodial Parent files the FAFSAMust include Step-Parent Income
Non-Custodial ParentIncome not included on FAFSAIncome IS included on CSS PROFILE
What if parents are
divorced or separated?
14Slide15
www.CollegeBoard.comRequired of some colleges and universities (mainly privates and a few public elites)
Application is customized to tailor to methodology of individual schools$25 Filing Fee may be waivedConsiders more information than the FAFSA
CSS Financial Aid PROFILE
15Slide16
Three example families:Family A’
s income = $135,000Family B’s income = $87,000Family C’
s income = $61,000
All have roughly a $10,000 EFC
How might this occur?
Hint: Remember the EFC formula variables we
just discussed
What income level might result
in a $10,000 EFC?
16Slide17
Funds (often scholarships) from sources other than the college or university, including:
Clubs and civic organizationsReligious institutionsEmployersFoundationsCertain types of benefits (military)Private gifts
What are outside resources?
17Slide18
Can…Meet unmet need (fill “The Gap”)
Replace loansReplace student employmentCan’t… Replace EFC in need-based award
What can outside scholarships do? What can’t they do?
18Slide19
Recap: What is Financial Need?
TuitionParent Contribution
Costs
(variable)
EFC
Financial Need
(variable)
Personal
Expenses
Books and Supplies
Transportation
Room and Board
Student
Contribution
Estimated Financial
Assistance
from
Outside Resources
EFA
_
_
=
19Slide20
Students receive e-mail with link to online Student Aid Report
Results are sent to schools listed on financial aid applicationSchools’ Financial Aid Offices then “package” aidFinancial Aid Award Letters or Notices are issued
Additional forms or steps may be required
Verification of information submitted (verification via IRS Tax Transcript, IRS Tax Receipt, or IRS Data Retrieval Tool)
Responses to follow-up questions
FAFSA corrections, if estimated on FAFSA
Loan Applications
What happens after you apply for financial aid?
20Slide21
Compare Financial Aid Awards
Focus on Net Price, Unmet Need, Loans vs. Grants, Scholarships, Work-StudyUse toolsCollege Navigator, College Scorecard, and Loan Repayment CalculatorsCFPB’s and
FinAid’s Financial Aid Comparison Tools, Financial Aid “Shopping Sheet”
Communicate with Financial Aid Office; “Ask and ask again”
Consider multiple funding sources and strategies
Use appeal process if family circumstances change
Understand terms and conditions of all aid awarded
Respond
to offers of aid (and admission)
Complete follow
-up
steps to secure offered aid
Notify
your chosen school
of outside
scholarships
Understanding Your
Financial Aid Award
21Slide22
A Comparison of Example Financial A
id Awards
Private #1
Private #2
Private #3
Public U.
Total Cost
$68,250
$66,500
$46,600
$21,230
Family Contribution (EFC)
$10,000
$10,000
$10,000
$10,000
Financial need
$58,250
$56,500
$36,600
$11,230
Merit aid
$0
$0
$15,000
$3,090
Need-based grant
$56,150
$50,500
$10,000
$500
Student loan
$0
$4,000
$5,500
$4,000
Work-Study
$2,100
$2,000
$2,000
$2,000
Total aid
$58,250
$56,500
$32,500
$9,590
Unmet need
$0
$0
$4,100
$1,640
Total paid/earned
$10,000 + work-study
$10,000+loan
+
interest+ws$14,100+loan+interest+ws$11,160+loan+interest+ws
22Slide23
Net Price CalculatorsFound on individual college websites (federally mandated)Family
enters income and asset dataNet price based on first-year full-time student (Net Price=TCA-Grants/Scholarships)Calculators differ by institution and generate Net Price to individual familyCollege Navigator
Federal online college comparison tool (TCA, Average
C
umulative Indebtedness)
Displays Average Net Price by family income levelsCollege ScorecardFederal online college search engine focused on college affordability and value (ROI)
How can families more accurately estimate the “Net Price” of college?
23Slide24
NYT Student Loan Calculator InputYour Expected Debt (Loan Principal) or School Name [
$30,480, NYU example]Your Interest Rate or Designated Interest Rate [3.76%, Stafford 2016-2017 rate]Your Loan Term or Designated Loan Term [
10-yr term]
NYT Student Loan Calculator Output
Your Estimated Monthly Payment (principal plus interest)
[$305.13]Your Total Amount Repaid (principal plus interest)
[
$36,616
]Your Annual Earnings needed to support loan repayment, two options:
Earnings equal to original loan principal
[
$30,480
]
Earnings sufficient for monthly payments to equal 20% of discretionary income
[
$35,813
]
“Know Before You Owe”
Student Loan Repayment Calculator
24Slide25
Private ScholarshipsOften lower dollar, but can add upMost local organization scholarships are merit AND need-based
Are they automatically renewing or must you reapply?Parent LoansFederal Direct Parent PLUS LoanPrivate loan to student and/or parent (cosigner required?)Alternative Funding StrategiesShorten length of undergrad education by claiming AP, IB, and DE creditChoose another college with lower TCA and/or better financial aid award
Begin at community college and transfer later
Financial aid not
enough?
Self-help options to fill the gap:
25Slide26
Based on student’s achievements and talents
Largest source is from schools themselvesFL Bright Futures Program (GPA, Test Score, Service Hrs.)Financial need typically not a dominant factorProcedures for being considered vary
NominationScholarship
application with essays
Admission
application and decision
Recommendation
letters
Must meet eligibility requirements and deadlines
Recruiting or rewarding? “Enrollment Management Tool”
Merit-Based Scholarships
26Slide27
Is the scholarship
renewable each year?If so, what are the requirements for renewal? (minimum GPA, certain major, full enrollment status)
Will the scholarship affect need-based
aid?
Can the scholarships be stacked?
Will the value of the scholarship change over time?
Can the scholarship be used to fund study abroad?
What questions should students ask about
merit-based awards
?
27Slide28
529 Plans (Education Savings Plans, Prepaid Tuition Plans)
Coverdell Education Savings Accounts (ESA’s)UGMA/UTMA Accounts U.S. Savings BondsRoth IRA’sInvestment accounts designated for educationSummer and/or academic year student
employment
What other options are available to help families pay for college?
28Slide29
Use f
inancial aid tools on PVSCollegeCounseling.comBe aware of schools’ financial aid policies (need vs. merit aid)
Recognize differential or preferential packaging
Deadlines are important, know and meet them
Avoid scholarship scams
Weigh Early Decision considerations (on both admissions and financial aid sides)
Know your loan terms and conditions
Understand basic formula for need-based aid
(TCA minus EFC equals Demonstrated Need)
Tips and Reminders
29Slide30
“Hope is not a plan”Act with integrity and start early (Oct. 1st FAFSA goes live)
Focus on Net Price when comparing award packagesHave “frank family discussion” about college funding before applying to schoolsInclude a “Financial Safety School” on your college listEFC is based on parents’ ability to pay, not willingness
to payExplore multiple financial aid options and
r
eapply annually
What should families keep in mind as they move forward?30Slide31
www.PVSCollegeCounseling.com - Recommended Portal
Quick links available from there regarding:FAFSA and CSS PROFILEFederal Student Aid IDNet Price CalculatorsFAFSA4CasterFederal Student Aid on the Web
College Navigator
College Scorecard
Student Loan Repayment Calculators
Scholarship Search EnginesCollege Affordability/ROI Comparison Tools
Financial Aid Online
R
esources
31Slide32
College Funding and Financial Aid Workshop
March 30, 2017
Jane T. Robbins