Demystifying college financial aid

January is financial aid month and all across the country, seniors and their families will be completing the forms needed to receive financial aid for the first year of college. The financial aid process seems complicated, but can actually be completed in just a few steps.
Complete the online Free Application for Federal Student Aid (FAFSA) which can be found at www.FAFSA.ed.gov. The FAFSA is available as of January 1, 2011 and should be completed as soon as possible to maximize the funds that are available.
In order to complete the FAFSA, students will need access to their family’s 2009 tax returns (filed in April 2010). The online FAFSA will allow students to list up to 6 colleges to receive the report – others can be added later.
Remember that the first F in FAFSA stands for “free.” There is no fee associated with FAFSA filing and free help is available through the FAFSA web site and by calling 1-800-4-FED-AID (1-800-433-3243.
Check with each individual college to see if other financial aid forms (such as the College Board’s CSS Profile) are required.
Once the form is processed, families will receive a report back from the Federal government called an EFC, or Expected Family Contribution, which shows what the family can be expected to pay. This number remains the same regardless of the tuition charged by individual colleges or universities.
This number will be sent to the colleges listed on the FAFSA. If anything needs to be corrected, or if the family’s financial situation has changed in any way, the EFC provides an opportunity to make revisions and to add more colleges.
When students have been admitted by a college, the college will also issue a financial aid “package” based on the family’s EFC.
Financial aid comes in different forms

GRANTS: These are monies that do not need to be repaid. It’s easy to remember – both “grant” and “gift” begin with the letter G. Students in New York City may be eligible for federal Pell grants (up to $5,550 per year for 2010-2011) and NYS Tuition Assistance Plan (TAP) grants (up to $4,000 per year for 2010-2011)

LOANS: Money that is borrowed, either by the parent or the student that must be repaid. Loans are offered by colleges, the federal government and private lenders, and can be either subsidized or unsubsidized. Interest rates and repayment plans will vary.

WORK STUDY: Money that students are paid for campus jobs, such as working in the dining halls, athletic facilities or tutoring centers.
When the time comes to compare financial aid packages, it is important to look beyond standard tuition, room and board. A student’s real Cost of Attendance (COA) includes books, lab fees, clothing and travel (even by monthly MetroCard).

A college education is a solid investment that yields results throughout a student’s life. According to a 2010 U.S. Census Bureau study, college graduates in the United States earn, on average, 47 percent more that high school graduates.

Still, as the cost of higher education rises, it is important for students and their families to be smart investors, understanding both the financial aid process and what benefits they can hope their investment will provide.
Students and families should avail themselves of all sources of information, including contacting college web sites, financial aid offices and free financial aid workshops, such as those held on State University of New York (SUNY) campuses throughout the state (www.SUNY.edu/student events).

Lisa Sohmer is Director of College Counseling and Upper Division Admissions at the Garden School, 33-16 79th Street Jackson Heights, NY 11372.

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