February is Financial Aid Awareness Month! This month we provide information to students and families about access to federal, state, and institutional student aid.
Applying for Financial Aid can be intimidating, especially when applying to college. Worrying about the cost of education goes well beyond just the beginning stages of college applications. Being informed of Financial Aid options can ease the stress of long-term student loan debt. In the fall, students can begin applying for Financial Aid through the Free Application for Federal Student Aid (FAFSA). The FAFSA is a free application for student aid that takes approximately 23 minutes to complete.
The application asks for information regarding income, assets, and demographic factors.
The amount of Financial Aid that applicants are given is determined by the student’s Cost of Attendance at a college or university subtracted by the Expected Family Contribution, which is what the student’s family is determined to be able to afford for that education.
Did you know these five facts about Financial Aid?…
#1) The most common mistake made by families is not filling out the FAFSA at all.
Many families think that they make too much money and will not qualify for the benefits of Financial Aid. Without a complete FAFSA, students will not qualify for any Financial Aid money. An incomplete FAFSA takes away a student’s chances from getting any money from the federal government, state government, and their chosen college or university.
#2) Institutions provide billons of dollars in aid to undergraduate students.
Looking at the statistics, the chance of receiving aid is high. Colleges and universities want students, especially ideal candidates and those passionate about their school, to attend their institution. This is why it is important to fill out the FAFSA on time and correctly. The FAFSA application is the best option for financial aid along with college scholarships.
“In 2020-21, institutions provided an estimated $57 billion in grant aid to undergraduate students — 33% of totalundergraduate aid, and 48% of undergraduate grant aid.”
“In 2020-21, undergraduate students received an average of $14,800 per FTE student in financial aid, including $10,050 in grants, $3,780 in federal loans, about $880 in education tax credits, and about $90 in federal work study,”
The College Board – Trends in Student Aid, 2021
#3) The 2022-2023 FAFSA relies on information from 2020 tax returns.
This allows students to inform financial aid offices directly regarding any changes to their financial situation, and colleges use professional judgement to determine the student’s expected family contribution. Questions on the application will remain the same from prior years. According to the Federal Student Aid website, there will be small changes to the visuals on the website, as well as the opportunity for the applicant to declare whether they are a student a, parent, or a preparer prior to beginning the application.
#4) There are many common mistakes made on FAFSA Applications
Some of the most common mistakes made on FAFSA Applications include the following…
Leaving a field blank – Instead, type 0 or N/A into a spot that does not elicit an answer
Forgetting to report all required sources of untaxed income
Not reporting both parents’ financial information if they are divorced
Waiting until the last minute or submitting the FAFSA late
Failing to create your FSA ID before you begin the form – Students and parents both need their own ID
#5) The FAFSA isn’t the only financial aid you can apply for
In addition to the FAFSA, students can be eligible for:
Scholarships and Grants – These do not need to be repaid unless money is owed to the institution. There are many types of federal grants that are available including Pell Grants, Federal Supplemental Educational Opportunity Grants (FSEOG), Teacher Education Assistance for College and Higher Education (TEACH) Grants.
Student Loans – Must be repaid at a later date with the accrual of interest.
Work Study – Allows a student to pay for school by working part-time.
Disclosure: This material is provided by TrinityPoint Wealth for informational purposes only and is not intended to serve as a substitute for personalized investment advice or as a recommendation of any particular security, strategy or investment product. Facts presented have been obtained from sources believed to be reliable, however, TrinityPoint Wealth cannot guarantee the accuracy or completeness of such information. TrinityPoint Wealth does not provide tax or legal advice.