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Financial Aid

Financial Aid. Presented by: Jeremy Dixon Financial Aid/Admissions Specialist The University of Alabama at Birmingham.

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Financial Aid

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  1. Financial Aid Presented by: Jeremy Dixon Financial Aid/Admissions Specialist The University of Alabama at Birmingham Information in this presentation is time-sensitive. Please not that websites, interest rates and data contained within this presentation are applicable for students entering college in fall 2010.

  2. What we hope to answer. • How to begin? • How do I look for scholarships? • What is Federal Aid? • What are the differences in the types of aid? • What do some of these acronyms mean? • What do I need to do? • Who can help me?

  3. Start By Doing Some Research • ALWAYS start with the college or university. • Know admission criteria • Know the standard Cost of Attendance (COA) • Know scholarship criteria • Find out the deadlinesfor scholarships • Figure out what you think you can afford

  4. Research (continued) • Research outside scholarships at these sites. • Fast Web • CollegeBoard • Peterson’s • The Student Guide • CollegeScholarships.org • Research scholarships and loans locally. • Always utilize your guidance counselor • Check with student and parent employer • Credit Union options (they sometimes have a very competitive interest rate) • Civic Organizations

  5. Research (continued) • Research scholarships and loans nationally. • Special Interest Funds (i.e. Diabetes Scholars Fund, Food Allergy and Anaphylaxis Network) • AmeriCorps– offers funding in exchange for community service • Federal Student Aid DO NOT pay for scholarship search services!

  6. What is the FAFSA? When you complete the Free Application for Federal Student Aid (FAFSA) at www.fafsa.gov the answers enable the federal government to calculate how much of your family’s financial resources should be available to pay for the cost of college expenses. The FAFSA refers to this calculated number as your “EFC” or “Expected Family Contribution” Colleges then use that EFC to determine your “demonstrated need” for federal aid such as PELL grants, work-study, etc.

  7. Federal Aid Quick Facts • 3 Categories of Federal Student Aid • Grants • Work Study • Loans • Must complete the FAFSA to be considered • The FAFSA establishes your Estimated Family Contribution (EFC) • Priority Deadline is March 1 of student’s senior year • Must be completed every year the student is enrolled

  8. Categories of Federal Aid • Grants • PELL GrantsMost families do not qualify for PELL grants. Must have a very low EFC (below 5273). Do not be discouraged if you do not qualify. Most families do not.Current minimum PELL grant is $555; maximum is $5550 • SEOG Grants Supplemental Educational Opportunity Grant gives priority to students who have already qualified for a PELL grant.

  9. Categories of Federal Aid • Work Study JobsFederal Work-Study is based on “demonstrated need”(salary is paid from 75% government sources and 25% from the university) • Loan Options • Perkins Loan A subsidized loan that carries a 5% interest rate • Stafford Student LoanThe subsidized loan carries a 3.4% interest rateThe unsubsidized loan carries a 6.8% interest rate

  10. A Need-Based Example If you took the full 10yrs to pay back the loan: Total paid toward the Subsidized Loan (3.4% APR): $19,000 (Principal) + $6,460 (Interest) = $25,460 (Total Paid) Total paid toward the Unsubsidized Loan (6.8% APR): $8,000 (Principal) + $5,440 (Interest) = $13,440 (Total Paid if not deferred) $9,632 (New Principal) + $6,549.80 (Interest) = $16,181.80 (Total Paid if capitalized) Grand Total after 10yrs = $38,900 or $41,641.80

  11. A Non-Need Based Example If you took the full 10yrs to pay back the loan: Total paid toward the Unsubsidized Loan (6.8% APR): $27,000 (Principal) + $18,360 (Interest) = $45,360 (Total Paid if not deferred) $32,270 (New Principal) + $21,943.60 (Interest) = $54,213.60 (Total Paid if capitalized) Grand Total after 10yrs = $45,360 or $54,213.60

  12. How is your financial “need” calculated? COST of the college/university equals… Direct Costs(defined costs of tuition, required fees, & room and board, if living on campus) + Indirect Costs (estimate for books, travel, expenses) Minus EFC(taken from results of FAFSA) Equals DEMONSTRATED NEED for federal aid

  13. A couple of examples… College “A” Cost = $7,000 EFC = $7,000 NEED = $0 College “B” Cost = 15,000 EFC = 7,000 NEED = $8000 REMEMBER: The Expected Family Contribution (EFC) remains the same, regardlessof the college’s cost. The challenge becomes finding ENOUGH financial aid and scholarship assistance to MEET/EQUAL the demonstrated need!

  14. Federal Student Aid • The Steps: • Gather your information. • Request your PIN (www.pin.ed.gov). • Complete the FAFSA (www.fafsa.gov). • Watch for Student Aid Report (SAR). • Communicate with the Admissions and Financial Aid Offices

  15. 1. Gather Your Information • Collect all tax information. • W-2’s • 1040/1040A/1040EZ • Records of untaxed income for student and parents bank accounts, stock, real estate, and business records for student and parents • Student’s and parents’ SSN and DOB • Student’s driver’s license number • Get a checklist of helpful documents fromwww.federalstudentaid.ed.gov/pubs

  16. 2. Request Your PIN • Go to www.pin.ed.gov and Apply • Parents and Student can both have a PIN • It will be available immediately via web or within 7-10 days via mail

  17. 3. Complete The FAFSA • The FAFSA has 7 Sections • Student Demographical Information • Student Tax Information • Determining Dependent/Independent Status • Parent Information • Household Information • School Selection • Sign & Submit

  18. Common Questions When Filing • How does the FAFSA define parent? • Not DivorcedParents Income = parent(s) of the student • DivorcedParents Income = parent who provides the most support (typically the parent that the student lives with the majority of the calendar year prior to completing the form) AND that parent’s spouse Forget… who claims the child on a tax return. what divorce papers say. what pre-nuptial agreement says

  19. 4. Watch for your Student Aid Report • SAR will be available in 7-10 days • EFC is printed on upper right corner • Make sure all the information is correct • Use your PIN and make changes using Corrections on the Web at www.fafsa.ed.gov

  20. 5. Communicate with Counselors • Know by name… • your Admission Counselor. • a Financial Aid representative. • your high school counselor. • Stay in touch with… • your Admission Counselor.(At least once or twice a month.) • your high school counselor.(As often as you can without being annoying.)

  21. My Contact Information Jeremy Dixon Financial Aid and Admission Specialist jgdixon@uab.edu 205-934-8735

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