Steps in the Financial Aid Process

Many people wonder how to go about securing financial aid. First generation college students do not have their parents’ experience to guide them. And, any number of students who didn’t expect to need financial are now applying because their parent’s portfolios have dropped to the point that financial aid has become necessary if the students are to attend college. So, for these students and everyone else, here are the steps of the financial aid process.

The first thing that you must do is fill out the Free Application for Federal Student Aid – the FAFSA. Don’t be put off by the “Federal” part because many state programs are also dependant on the numbers that are produced by the FAFSA.

The information you put into the FAFSA about your family’s income and assets will be fed into a calculator. This will generates what is known as the Expected Family Contribution (EFC). The EFC is the amount that you and your family will be expected to pay wherever you go to college.

For instance, a student with an EFC of $3000 will pay $3000 at a school that costs $12,000 or one that costs $40,000 assuming that a suitable financial aid package can be put together. That means that you should not allow the “sticker price” of a college to keep you from applying for the school.

Once the FAFSA is complete, you qualify for federal aid. There are three main federal programs you should know about. Low income students can qualify for the Pell Grant which can give you $4731 towards your college expenses. Low and middle income students can qualify for the Stafford Subsidized Student Loan which is a low interest loan. The federal government pays the interest on the loan while you are in school. And, the federal government gives the school money to hire low and middle income students as workers at the college through the federal work study program.

But the FAFSA qualifies you for state aid as well. Every state has a grant program to help in state students attend college in the home state. For instance, in California, the Cal Grant awards amounts roughly equal to the tuition and fees at state colleges and up to $9700 for students attending the state’s many private colleges. Usually with these student grants, you are required to maintain a certain grade point average and make satisfactory progress toward the degree.

Finally there is institutional aid. Most schools use the FAFSA to determine how much money they will give to you in scholarships and grants. Some schools promise up front to meet the full demonstrated need of all admitted students. Ironically, the more expensive the college is, the more likely they are to be able to give you the financial aid that you need to attend.

It is critical that you turn in your FAFSA no later than March 15 if you are going to start school in August or September. Even if you haven’t been admitted to colleges yet, you need to get this form in.

Also, you should be aware of filing dates for federal and state grants. There often is not enough money in the pool to meet the needs of all qualified students. The early bird gets the money.

The FAFSA determines your EFC. That, in turn, will largely influence how much money is available to help you pay for school. Get your FAFSA in early to maximize your chances that you can attend your dream school.

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