How does the financial aid thing work?

<p>I don't know when we are supposed to file FAFSA?</p>

<p>FAFSA is always available Jan 1. You can wait to submit it once you finish your (and your parents) taxes, or do it ASAP using estimates and then correct it when you have final figures.</p>

<p>You file the FAFSA online, or on paper after January 1 for classes that begin in the summer or fall. If you are starting college this fall, you had better get it done tonight. FAFSA</a> - Free Application for Federal Student Aid</p>

<p>If you are starting college next year, you can do it any time after midnight on January 1, 2009.</p>

<p>Make sure you keep track of priority filing dates for your school(s). There are certain types of financial aid that aren't tied to on-time filing (Pell & Stafford loans), but other types are first-come, first-served ... and if you might qualify for that aid, you don't want to miss out.</p>

<p>So how do schools give out financial aid, if the time to apply is the same as when we send in our applications.</p>

<p>They don't actually award the aid until you are admitted. The reason for a deadline is so that they can get everything in the system & ready to go in order to award aid in a timely fashion. Say the deadline is March 1. Everyone who is admitted & had their financial aid info in on time will be considered for all possible aid they would be qualified to receive. They might get a Supplemental Education Opportunity Grant, a Perkins Loan, Federal Work Study, and/or Need based institutional grants if they apply on time. If they miss the deadline, they might not be in the pool that is awarded some of this limited-supply aid. Since everything is automated, it's not that hard to award the aid to the qualified applicant pool.</p>

<p>Schools that award aid as applications are processed have set policies for awarding, based on certain EFC's. I will go out on a limb & say that these schools probably don't award much more than loans, Pell, and work study. On the other hand, they could be schools that have enough money to take care of lots of needy folks ... or they are need aware in admissions (won't say yes if you need too much aid).</p>

<p>Review an online guide to the financial aid process:</p>

<p>FinAid</a>! Financial Aid, College Scholarships and Student Loans and</p>

<p>FinAid</a> | Financial Aid Applications</p>

<p>You may also wish to get a copy of "Paying for College Without Going Broke", by Kalman Chany, it is published annually by the Princeton Review, The</a> Princeton Review, new editions come out each year in Mid October. It gives you strategies in completing both the FAFSA and CSS Profile forms line by line.</p>

<p>I don't want to start a new thread just for this question, so I'll tack it on here:</p>

<p>Does FAFSA consider retirement funds as part of my assets for financial aid purposes? Or just the investments that are actually liquid? I can't touch my retirement funds without severe penalties, so it doesn't <em>seem</em> like they should be--but I haven't been able to confirm that anywhere.</p>

<p>^^ FAFSA does not consider the retirement fund per se. It does, however, consider the $ you put INTO the fund.</p>

<p>FAFSA does not consider retirement funds. Schools who use the Profile may however, consider retirement funds.</p>

<p>$$$ contributed - yes.</p>

<p>lunitari, College financial aid calculations per FAFSA do not include the BALANCE in your 401K, 403B or IRA (or similar) accounts. But the calculations DO include the amount you contribute for the tax year used for filing your FAFSA. For example...if you are filing a 2009 FAFSA on Jan 1 2009, you will be using figures from the 2008 tax year. Any money you contributed to your retirement accounts in 2008 will be added back in as income for the FAFSA. The amounts IN your accounts are not listed on the FAFSA.</p>

<p>Now..the some schools using the Profile DO ask for the retirement account balances, but no one I know really knows how those are used.</p>

<p>There is a thread pinned at the top of this forum "Preparing for Finaid Applications". It has a LOT of information from many folks about the process, dates, etc. </p>

<p>One thing that needs to be changed is that the FAFSA now accepts 10 schools on the form instead of just 7.</p>

<p>You are asking about FAFSA in your first post, and maybe you already know this, but just in case you don't... Thumper refers, just above, to Profile schools. Profile is the CSS Profile which is found on the College Board site (yes, you may still need to be paying CB... :( ) Many private schools require you to file the CSS Profile in addition to the FAFSA. FAFSA is used in public schools (I don't know whether publics use the Profile). Profile can be done in October (at least that's when we did it). You only have to do that once, I believe, and also many of the items that you complete for the Profile can get transferred to the FAFSA. Profile does have other questions in addition to FAFSA, so it's complicated. Give yourself plenty of time.</p>

<p>As you have read from all of the posts, FAFSA is necessary for financial aid. That makes you eligible for government loans and grants if the numbers come out in that threshhold. You cannot file FAFSA until January 1 of the year after you start your apps, so you will file FAFSA no earlier than Jan 1 2009 if you start your applications in fall of 2008 for college to start in fall of 2009. However, you can start with the PROFILE first, if you are applying to colleges that use that. Many schools with Early programs require a PROFILE to be filed at the time of application. Since final numbers would not be available, you need to use prior year forms, making adjustments where you know there are big changes. Final figures have to be done when you get them and adjustments to your aid will be made accordingly.</p>

<p>It would be a good idea to fill out a paper copy of the FAFSA or use one of the web samples just to see where you stand. You can also make adjustments to your financial situations since it is your financial snapshot on the day you complete it that is used. You don't want to have an insurance payment sitting in your bank account to get your car fixed on that day. You want that money paid out. You may want to pay some future expenses to deplete your savings somewhat since you are assessed at 20% for your assets vs about 5% for your parents. So you may want to pay for your clothes, supplies, college fees, and have your parents reimburse you by paying some of your college expenses afterwards. If your parents have a home equity value that puts you over the allowance for some school on the PROFILE, and they also have a credit card debt, they may want to use the equity to pay the debt since Home equity is an asset that can count whereas no allowance is given for credit card debt. Your parents may want to contribute to an IRA or 401 k more heavily, moving assets sitting in a CD or other account so that they can be sheltered. Or it may not make any difference at all. By running the numbers through, you can see what is best done. </p>

<p>If you are "middle income", it is doubtful,FAFSA will generate any money for you other than student loans. Most money for that income bracket comes from the schools. Schools that are FAFSA only do not tend to meet 100% of need, so unless you a stellar student with high test scores, financial need is usually met by PROFILE schools which require careful research. </p>

<p>Good luck. You have time to do the research which can help prevent some nasty surprises. I suggest you buy or borrow a current book on applying for college financial aid, and double check on line that the info is current. Also, check info on specific schools.</p>

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If you are "middle income", it is doubtful,FAFSA will generate any money for you other than student loans.

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<p>I assume you mean grants from the Federal Government? If so - correct. Although, it does depend on family size, # of family members in college and maritial status. Many "middle income" kids do get need based grants from their FAFSA college, although usually not enough to meet their EFC.</p>

<p>In many cases if the parents are divorced then a FAFSA school is the way to go. If you are a good student many schools offer merit scholarships that when coupled with a need based grant makes for a nice financial aid package.
It all depends on the school, their philosophy, abilities to help and the students package. Peruse each schools financial aid web page and read carefully.</p>

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<p>The CSS Profile also must be updated to reflect accurate numbers once you have completed your taxes. HOWEVER, you cannot do this online as you can with the FAFSA. You need to contact each college to find out their procedure for updating the income information on the Profile. Some will tell you to send a copy with the corrected numbers written in. Some use a service called IDOC which collects tax returns and other supporting documents, and they may or may not ask you to update the Profile yourself...by hand.</p>

<p>I always say...when in doubt...call the schools. They know what their procedures are.</p>

<p>"If you are "middle income", it is doubtful,FAFSA will generate any money for you other than student loans."</p>

<p>what would you consider "middle income"?</p>

<p>Anything above the threshhold of getting subsidized Stafford loans. TThere is no set number since it depends on a number of factors such as number of dependents in the family, age of the parents, assets. You can look it up and get some idea of the matrices involved, and find where your particular situation lies.</p>

<p>Actually, subsidized Stafford eligibility is really a function of the cost of attendance. The more expensive a school is, the more likely you will be to be able to borrow a subsidized Stafford! That's because subsidized are awarded for unmet need (up to the max sub. Stafford for year in school) & unsubsidized are for both unmet need & EFC replacement. Tricky stuff, these Staffords. The Perkins, on the other hand, I won't even try to explain those!!</p>

<p>I'm with you, Kelsmom. I've yet to get the explanation for FSEOG and Perkins. My understanding is that the subsidized Stafford is available up to the maximum allowable for the COA above the EFC level. In other words with an EFC of $10,000, and a COA of $50,000, the subsidized Stafford has a $40K range which is waay over the maximum so max subsidized Stafford is allowed as long as that need is not met with other grants. What most schools would do (those that meet full need but are not loan free), would apply the max subsidized Stafford towards the $40K need, ( I don't think Pell would come into play at this level), then apply its own grants and scholarship into the formula, and possibly work study. Any state money or private scholarships would reduce the college grants. If the school has FSEOG and Perkins funds, it might be applied to the need in place of school money, though I believe Perkins loans go to Pell recipients first, so only if there are funds left over, would a non Pell kid get any of that. Don't know about FSEOG.</p>

<p>FSEOG goes to Pell recipients only. The schools determine how to dole it out. The urban state school near me caps it at $500 per student, since they have so many Pell-eligible students. I think the max allowable by feds is $2000/student (I could be wrong, though).</p>

<p>As for Perkins ... it is new & I never worked with this program. I do know that it's only available at some schools. How it works mystifies me. My D was awarded one at a school last year ... we are definitely not Pell eligible. I can't remember how much her Perkins award was, but it was also packaged in with a subsidized & unsubsidized Stafford. This school did fully meet our need, but with a lot of loans.</p>