Student Loans & Financial Aid info

I want to start by taking a moment to define what financial aid assistance is and is not. Your college or university and Uncle Sam will generally define financial aid assistance as any assistance that is not coming from your own pocket. This includes college student loans. Most financial aid has not come from entitlement programs such as the Pell Grant. Therefore, keeping in mind that outside of the Pell Grant program no college student is owed anything. Everyone has to apply on his or her own and be judged accordingly. This probably sounds a little harsh, but it is not. Every year our government, colleges, and universities are tasked with the huge responsibility of identifying the most needy and most deserving college students out of the hundreds of thousands that have apply. It is by no means a perfect science, but their primary intent is to open doors and not to close them.

In addition, once those doors have been opened, what will you find on the other side? I hope that you will find the resources that will allow you the best investment you will ever make: your college education. All financial aid assistance resources are grouped into two categories: gift aid and self help aid.

Gift aid is defined as financial aid assistance that you will not have to pay back. Typically, this will encompass grants and scholarships. Self help aid is assistance that will require you to do something; either work for the help or pay it back. College work-study programs and all college student loans fall into this category. We can look at these individually.

The federal Pell Grant program is the backbone of all federal aid assistance programs. Once a college student has completed their FAFSA, the first thing a school will determine is if there are Pell Grant eligible. The information a college student and their family provide on the FAFSA will be used to calculate the Expected Family Contribution (EFC). The EFC determines whether the college student is eligible for the Pell Grant. Recipients of Pell Grants must be undergraduate students who have not yet earned their first bachelor’s degree. Completing the free online FAFSA is the only way a college student can apply for a Pell Grant.

Federal Supplemental Educational Opportunity Grant (FSEOG). These grant dollars have been reserved for those Pell Grant recipients who demonstrate the most financial aid need as determined by the FAFSA. FSEOG money is funded by the federal government but will be administered by the local college. SEOG awards will vary by institution depending on availability of money. Award amounts can be from $100 to $4,000.

Institutional and State Grants. Most states will offer grant programs for their residents, however, eligibility and availability of monies available will vary. Additionally, many colleges will make available institutional grant monies that come from endowment sources or other private donation sources. This is typically, what you would find at a private college. A school’s admission brochure or web site will be the best place to locate additional information.

Scholarships. Scholarships are not only for a valedictorians or star athletes, but also for regular students with many kinds of unique qualifications. They will typically fall into two categories: need-based or merit-based.

Need-based scholarships generally determined by a student’s EFC. Outside of the college or university, many scholarship foundations will require your school to provide them with your EFC or at least answer some general questions about your family’s financial situation. Eligibility requirements will vary quite a bit among colleges, universities and foundations looking at need as the primary selection criterion.

Merit-based scholarships are generally based on a student’s talents or academic achievements. However, other things like there leadership ability, moral character and involvement in extracurricular activities will also warrant scholarship accessibility. Merit-based scholarships will often be based on SAT or ACT test scores.

There are literally thousands of available scholarships for all types of college students. A student’s extracurricular activities, area of study, where there live or musical talents are all examples of different criterion used to select scholarship recipients. Do not get locked into the idea that there is nothing out there for you to apply for. With some determination, any college student can uncover a pot of gold in the form of a scholarship.