How Does Financial Aid Work
College is not cheap, not by any means. For those who choose an instate-college education or even a community college, the price of tuition has drastically risen over the last few decades causing students to wonder of “How will I pay for all of this?” This question is more prominent than ever before, regrettably. For the fortunate, there is either a college fund already set in place by parents or a family member or mom and dad have taken out a loan to pay for college, but not everyone comes from such prosperous households. For those who haven’t saved or planned for college tuition and aren’t as lucky as the aforementioned group–well, the options can be very slim, but there are options.
And it’s not just the college tuition, but everything that surrounds college life that can be so expensive. From the books and binders to registration fees and food, college is more than a pretty penny these days. Just thinking about how much it all costs creates headaches, now imagine wondering where the money will come from –that causes stress-levels to skyrocket. Thankfully, the government has already created a solution; the government wants you to go to college, therefore they give you options so that you can pay for it –later. Under the umbrella of financial aid, the government’s solution to the high prices we have pay to in order to be educated at the university level, are a few subcategories, namely Work-Study, Scholarships, Need-based Awards, Federal Pell Grants, and Student Loans.
To learn about how each financial aid works, read below.
This program offers students in need, of both undergraduate and graduate levels as well as full and part-time, the opportunity to work while studying. Of course, there is a limit on the hours permitted and that will be determined by the school’s funding and the programs in which the student is enrolled. Students will not be paid more than the state’s minimum wage and in some cases, more likely for graduate programs, students can earn a salary rather than an hourly wage. Some jobs will be on-campus while others are off-campus, this will depend on what is available at the time the student registers. Not every institution is involved with work-study programs, so it’s best to consult the Financial Aid office on campus; inquire within.
While the list is lengthy and can be overwhelming, there appears to be a scholarship for every type of student out there today. From sports to the arts and from academic to ethnic –there is a scholarship for everyone. The only problem is the rest of the world is also applying for the same scholarships. Not only are the scholarships highly competitive, but they do not come in large quantities meaning under each category scholarships are limited. However, this should not discourage students from applying to as many scholarship as they’d like; one student can apply for multiple scholarships at the same time. Scholarships can cover a student’s entire college career, a few years, or a portion of the tuition –all of that will be determined by the governing distributors. Most students begin looking into scholarships in the third and fourth years of high school.
For students who believe that either they don’t earn enough to pay for college or that their families’ salaries are not substantial enough to cover the cost, there is the need-based aid. There are two types of applications for need-based aid, the FAFSA and the PROFILE –both can be filled out online or in hard-copy format. Some institutions require the FASFA, others the PROFILE application, whereas others require both. Students must do their homework and inquire about which application suits the institution. All need-based awards will demand copies of tax returns and/or W-2s; therefore, students should either have their own documentation or that of their parents. How a student applies varies –if a student is claimed by his/her parents on tax returns –the students is dependent, if not –the student is independent.
Federal Pell Grants
Grants are money awarded to students –and students do not have to pay them back. It is gifted money straight from the government. While the grants have a cap, in many cases no more than $5,000 per year, they are helpful for students who have a great need. Also, students cannot receive such grants for more than six years or 12 semesters; when the time grows close to running out, the government will send a notice. Factors that will affect the amount granted include the following: the student’s need, the program cost, if the student is full or part-time, the amount of time the student plans on studying (more than a year).
Like any other loan, this is money borrowed that must be paid back. There are government-funded student loans and private-funded student loans; students should investigate which type of student loan suits them best. The lender will determine the rates, the policies, and the payment schedule, but there is no shortage of student loans on the market; therefore, students should shop around and educate themselves about the details pertaining to student loans. Each loan institution has a particular set of rules regarding payment plans, defaults, and deferments –students are advised to inquire about such issues prior to signing any contract. Student loans do not have to be paid back while the student is studying or if the student, after graduation or a hiatus, returns to his/her studies.
These are the most popular forms of financial aid available, of course there are other options and students should inquire either at the university or the current institution where they are enrolled. Paying for college is no easy task, therefore making a decision should be done with plenty of knowledge and patience. There is no rushing here, students should plan ahead, ask questions, and learn how each type of financial aid functions prior to making any decision. In some cases, consulting a money expert, school counselor, and/or financial aid professional are all highly recommended.