Financial Aid Night Presented by Valerie Knopp St. Cloud State University

Financial Aid Night
Presented by
Valerie Knopp
St. Cloud State University
Dear Dad…
$chool i$ really gr8. I am making lot$
of friend$ & $tudying very hard.
W/all my $tuff, I $imply can’t think of
anything I need, $o if u would like, u can
ju$t $end me a card, a$ I would love to
hear from u.
<3 ur $on
$ent from my iPhone
Dear Son…
I kNOw that astroNOmy, ecoNOmics and
oceaNOgraphy are eNOugh to keep even an
hoNOr student busy. Do NOt forget that the
pursuit of kNOwledge is a NOble task and you
can never study eNOugh.
Love,
Dad
Sent by e-mail
Myths to Qualify
for Financial Aid
 We make too much money to qualify
 We have too many assets to qualify
 It’s not worth completing the application
(FAFSA)
What we’ll cover…
 Application Process
 Definition of “Need”
 Aid Types and Sources
 Need Analysis Formula (optional)
Application Process
Who is eligible?
U.S. citizen or permanent resident
High school graduate/GED holder/Home
school Certificate
Eligible degree/certificate program
Valid Social Security number
Registered with Selective Service (males 18 years old)
No conviction for drug offense while receiving
federal aid
Satisfactory academic progress
How to Apply
 Free Application for Federal Student Aid (FAFSA)
 Online at www.fafsa.gov – fastest, most efficient
 As soon as possible after January 1st – earlier the better
 Watch out! Only use the “.gov” site – anything else and you will be
charged and your results may be delayed
 Check the schools’ deadlines
 Paper FAFSA
 Download from www.fafsa.gov - select “FAFSA Filing Options”
 Order by phone - 1-800-4-FED-AID
 School Form or CSS Profile (if applicable)
Government Philosophy
on Financial Aid
 Three partners who share responsibility for
educational costs: students, parents, and taxpayers
(government).
 Parent and student responsibility to pay for
college expenses to the extent that they are able
before federal or state funds are used.
 FAFSA – determines an EFC (Expected Family
Contribution) to make a consistent evaluation of
each family’s financial circumstance.
FAFSA on the Web
www.fafsa.gov

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Apply/Reapply
Apply for PIN
Filing Deadlines
IRS Data Tool
(DRT) available
late February 2013
Find college codes
Check status of
FAFSA
Make corrections
Print SAR
FAFSA4caster
Filing Deadlines
 See state “Deadlines” at
www.fafsa.gov
 Minnesota State Grant deadline is 30th
day of the start of the term
 Check with the schools - college
deadlines vary and may be early.
Check with the individual college
Personal Identification Number
(PIN) www.pin.ed.gov
Apply for a PIN or have PIN and forgot it?
 When completing the FAFSA (real time), or at the PIN website
Forgot your PIN? “Request a Duplicate PIN” at PIN website
Student and at least one parent need a PIN
Use your PIN to:
 IRS Data Retrieval Tool (DRT) to complete the FAFSA
 Sign your FAFSA electronically
 Check the status of your FAFSA or Make corrections to your FAFSA
 Sign Master Promissory Note (MPN) for federal loans (student and
PLUS)
 Look up student’s loan and grant history (www.nslds.ed.gov)
FAFSA on the Web www.fafsa.gov
NOTE: After 1/1/13 the
two options will be
2012-13 and 2013-14
Main page
once logged
in
Renewal or
New FAFSA
Remember
to select the
correct
award year
PIN status
Step 1: Beginning a FAFSA
Step 2: Filling out the FAFSA
High School (high school grads only)
School Codes (up to 10)
Finding School
Codes:
• FAFSA on the
Web search
•“Paying for
College” booklet
(Minnesota schools
only)
• School’s website
Dependency Questions
If student answers “NO” to
all questions, parent
information must be
included on the FAFSA.
Special Circumstances (dependent students only)
Who is a “Parent” for the FAFSA?
 Biological, adoptive, or step-parent
 Grandparent, foster parent, other relative
or legal guardian (who are not the parent)
are NOT considered parents unless they
legally adopted the student.
Entering Parental Data
IRS Data Retrieval Tool (DRT)
Who can use it? Dependent and independent students
(parents of dependent students) who meet ALL criteria:
 Valid SSN
 Filed a 2012 IRS tax return, AND
 Unchanged marital status since December 31, 2012.
 Available approx. late February 2013
 Displays if student (or parent, for dependents)
selects tax filing status of “Already completed”
22
Application Statistics*
Average completion time for NEW FAFSAs filed
January 1, 2012 - September 30, 2012
2012-2013
2011-2012
Application
Type
(English)
# of
Applicants
Completion
Time
(in minutes)
3,455,616
37:04
FAFSA
EZ FAFSA
329,120
32:02
Renewal
4,003,109
394,268
FAFSA
EZ Renewal
Application
Type
(English)
# of
Applicants
Completion
Time
(in minutes)
3,879,269
19:03
EZ FAFSA
594,765
16:31
27:13
Renewal
4,894,169
14:36
19:52
EZ Renewal
774,079
10:60
*From 2012 Federal Student Aid Conference
www.ifap.ed.gov/presentations/attachments/2012FSAConfSession26FAFSAApplicationProcessingUpdate
What if I filed without using IRS DRT?
IRS DRT (cont.)
 Check tax
filing status
“Already
completed”
 If “Married
Filing
Separately”
applicant is
ineligible to
use IRS
DRT
NOTE: If you
recently filed
taxes, you won’t
see IRS DRT. 2-3
weeks after you
file electronically,
correct the FAFSA,
change this to
“None of the
Above”, and then
use IRS DRT
IRS DRT (cont.)
IRS Interface
Insert all
information
exactly as it
appears on
your federal
tax return
(e.g. St. for
Street or Street
for St.)
Transfer IRS data to FAFSA
REMEMBER
• Select the
box and the
“Transfer
Now” button.
• Include
“earnings
from work”
on the
FAFSA after
data transfer
What if I don’t use the IRS DRT?
If you’re selected for
verification and did not use
the IRS DRT, you must
provide a Tax Return
Transcript issued by the IRS.
NOTE: A Tax Account
Transcript does not provide
sufficient information.
FAFSA saved up to 45 days
Entering Income Information
(student view – same for parent)
If entering estimated income information, click here.
REMEMBER: Update your information once you
complete your federal income tax return.
Sign and Submit the FAFSA
Both student
and parent
must sign.
“Save”: You store
the data to retrieve
later (up to 45
days).
“Submit”: Your
FAFSA will be
processed.
Confirmation Page
Transfer
sameparent
info for a
(dependent)
sibling need?
Click the link
on the
confirmation
page to
forward
parent info
from your
FAFSA to
your sibling’s.
Estimate based on data
entered. School will
determine eligibility.
NEW for 2013-2014: MN On-Line Student
Eligibility Questionnaire
Student must click on MN link on
Confirmation page to be redirected to
OHE on-line questionnaire
First
optional
feature only
appears for
dependent
students
Step 3: FAFSA Follow-up
Make Corrections to a Saved FAFSA
Check status of a submitted FAFSA
Print Signature Page (if not signed electronically)
Application Status Check
1. Processed, not submitted
2. Processed, missing signatures
(rejected to school)
Corrections on the Web
REMEMBER: Save your correction(s) before submitting.
Completed FAFSA…
…now what happens?
Department of Education: your estimated
Expected Family Contribution (EFC)
Student: receive your Student Aid Report
(SAR) by e-mail or mail
Financial Aid Office: receives electronic
copy of your FAFSA results
If selected for verification, the school(s)
listed on your FAFSA will contact you
Verification (not an audit)
 Some applications may be selected for verification
by the Central Processing Service or the school
 School will send student/family: Verification worksheet
to complete, sign and return
 School will request: Federal income tax transcript (not
the return) and W-2 forms for student and parent, if
applicable (www.irs.gov for transcript)
 If selected for verification, please do not make
corrections to your FAFSA unless the school
requests it
The Financial Aid Office
 Determines student’s
eligibility based on FAFSA
results (and verification, if
required)
 Packages and offers
financial aid to students
 based on eligibility
 in attempt to meet financial
need
 Sends an award letter
detailing:
 Cost of attendance
 Types and amount of
financial aid
 Conditions of the award
 Disbursement procedure
NOTE: Students must be admitted to (not enrolled at)
the college before they can receive an award letter.
Eligibility for Financial Aid
 All students and families are encouraged to complete the
FAFSA for need and non-need based aid.
 Submit the FAFSA by filing deadline (no later than the
30th day after the start of the term if Minnesota state
grant-eligible).
 Admitted to the school and enrolled at least half-time (6
credits) to receive most types of aid.
 Make satisfactory academic progress (GPA, credits completed
v. attempted, maximum time frame) to receive aid.
Review of Application Steps
 PIN - student and at least one
parent
 File federal income tax
returns
 Complete FAFSA at
www.fafsa.gov
 Review Student Aid Report
(SAR)
 Complete verification request
from school (if applicable)
Definition of Financial Need
Cost of Attendance (variable)
- Expected Family Contribution (EFC) (constant)
Eligibility for need-based aid (variable)
Factors used in determining EFC:
• Parent(s) income (taxed & untaxed) and assets
• Student income (taxed & untaxed) and assets
• Household size
• Number in college
Cost of Attendance
Each school’s will vary; all will include:
TRAVEL
ROOM/BOARD
PERSONAL
TUITION/FEES
BOOKS
Need Varies Based on Cost
NOTE: Your Expected Family Contribution (EFC) remains the same.
Estimators
• Minnesota Office of Higher Education
www.getreadyforcollege.org/Estimator/firstQuestions.cfm
• Fafsa4caster
www.fafsa4caster.ed.gov
• Finaid.org
www.finaid.org/calculators
Types of Financial Aid
Gift Aid
 Scholarships
 Grants
Self Help
 Employment
 Loans
Gift Aid: Scholarships
Merit-based aid
 Local or Private – visit with your
school counselor
 College/University where you apply
 Scholarship search services
 Watch out for scams
www.ftc.gov/bcp/edu/microsites/scholarship/index.shtml
Beware of Scholarship Scams
"The scholarship is guaranteed or your money back.“
"You can't get this information anywhere else.“
"I just need your credit card or bank account number
to hold this scholarship.“
"We'll do all the work.“
"The scholarship will cost some money.“
"You've been selected by a 'national foundation' to
receive a scholarship."
"You're a finalist.“… in a contest you never entered
Scholarship Scam Information:
Federal Trade Commission:
www.ftc.gov/scholarshipscams
Gift Aid: Grants
Need-based gift aid*
 Federal Pell Grant
 Federal Supplemental Education Opportunity Grant (SEOG)
 Federal TEACH Grant* (not based on need; agreement to serve requirement)
 Minnesota State Grant
 Other
Self-Help Aid: Employment
Earnings paid as hours are worked
Federal Work-Study
Minnesota Work-Study
College Employment
Self-Help Aid: Loans
Must be repaid with interest
• Need-based (guaranteed student loans)
 Federal Perkins Loan
 Federal Subsidized Stafford Loan
• Not need-based
 Federal Unsubsidized Stafford Loan (guaranteed student loan)
 Federal PLUS Loan (parent loan, credit check required)
 Private/Alternative Loans (variable rates/terms; credit check)
How to Save $$ While in School
 Determine needs vs. wants
 If you registered for a course, complete it
 Work part-time (10-15 hours per week)
 Avoid credit cards and card pushers (using credit and not paying
it off can cost more than it’s worth)
 Buy used books and clothes
 Learn to cook
 Share living expenses with a roommate
 Use public transportation, a carpool, a bike, or your feet
 Stay healthy
 Buy food & supplies in bulk; buy generic, shop farmer’s
markets
 Use student discounts
 Live like a college student so you don’t need to do it later
Financial Literacy Websites
 studentloans.gov - Select “Financial Awareness
Counseling” (NOTE: Not the same as entrance loan counseling for new borrowers)
 www.igrad.com
 www.mappingyourfuture.org - Select “Manage Your
Money”
 www.smartaboutmoney.org
To keep in mind…
 Discuss as a family the costs – how and
how much – of financing college.
 Discuss as a family available resources to
meet these costs.
 Carefully evaluate and understand the
terms and renewal requirements for aid.
5 Questions to Ask the
Financial Aid Office
1. What do I need to finalize my award letter?
2. What academic requirements are there to keep
my financial aid?
3. What are the terms of the loans?
4. Where can I find a job (work study or not)?
5. How and when will I receive my financial aid?
Modified from www.ed.gov/blog
Additional Resources
 Minnesota College Goal (FAFSA Assistance)
minnesotacollegegoal.org/Locations.cfm
 MN Office of Higher Education getreadyforcollege.org
 FAFSA Helpline 1-800-4-FED-AID
 U.S. Department of Education
www.ed.gov or http://nces.ed.gov/collegenavigator
 General Financial Aid www.studentaid.ed.gov
Questions about
this presentation?
St. Cloud State University
Financial Aid Office
Administrative Services 106
720 Fourth Avenue South
St. Cloud, MN 56301
www.stcloudstate.edu/financialaid
[email protected]
(320) 308-2047
1-877-654-7278
Calculating the EFC
(Expected Family Contribution)
Parent Contribution – Income
Parent Income (AGI + Untaxed income)
- Taxes and FICA
- Employment expense allowance
- Income protection allowance (variable)
= Available Income
Parent Contribution - Assets
Parent Asset Equity
- Asset Protection Allowance (variable)
= Discretionary Net Worth
x 12% (Asset Conversion Rate)
= Contribution from Assets
Parent Contribution - Total
Available Income
+ Contribution from Assets
= Adjusted Available Income
x % (variable)
= Parent Contribution
÷ Number of family members in college*
*do not include parents in college
Student Contribution - Income
Student Income
- Taxes (federal, state, FICA)
- $6,130 Income Protection Allowance
= Available Income
x 50%
= Contribution from Income
Student Contribution - Total
Contribution from Income
+ 20% of asset equity
= Total Student Contribution
Expected Family Contribution
(EFC)
Parent Contribution
+ Student Contribution
= Total EFC