Last week, I talked about the different forms of financial aid you can receive. I only briefly discussed the actual process of applying for financial aid, despite it being very important, so today, I’ll be exploring it in detail. I’ll talk about federal financial aid in this article, and financial aid provided by schools in the next article.
Financial aid is simply money provided by the government to you, so you can pursue an education. Financial aid has multiple forms: some have to be repaid (loans), and others don’t (grants, scholarships, etc). While financial aid has to be used to cover education-related expenses, it doesn’t have to be spent on tuition. This means you can use it for textbooks, housing, supplies, and transportation to and from school (you can’t use it to buy a car, though).
In some cases, financial aid is sent directly to you so you can spend it on whatever you feel is appropriate (education-related, of course), while in other cases, the financial aid is sent directly to your school, and your school deducts that amount from the tuition you owe.
To reiterate, for the purposes of this article, I’ll be discussing federal financial aid, which is financial aid provided by the government.
Before I explain how you can apply for financial aid, it's important to note that financial aid is need-based, meaning you must demonstrate that you wouldn’t be able to attend college if you didn’t have aid (it’s too expensive without aid). In order to prove that an education would be too expensive, the government looks at a variety of factors, including income, assets, and other scholarships you have received.
So, before applying for financial aid, sit down and have a conversation about paying for college with your parents. Because financial aid is largely need-based, not everyone will qualify for grants and other similar, need-based forms of aid, so it's important to know your situation before applying.
With that said, let's explore how you can apply for financial aid.
To apply for financial aid, you need to apply through something called FAFSA, or the Free Application for Federal Student Aid. This is an application you need to fill out so the government can determine how much financial aid you will receive. You can begin applying by creating an account here: https://studentaid.gov/. Remember, financial aid is given out in a few forms, including grants and student loans. By filling out your FAFSA, you see how much money you can get in any kind of financial aid.
Once you have an account, ask your parents to clear out an hour of their time to help you fill out the form. You also need a few key documents: your social security number, your parent's social security number, and your parent's federal tax returns. You’ll also need to know the amount of money your parents have in accounts and assets (stocks, real estate, savings, etc), so ask your parents to print out updated balances.
Once you have this information, all you’ll need is time and patience. You should also have a couple colleges/vocational schools in mind because the form will ask you to include at least one. I can’t tell you much about actually filling the form out because it’ll differ for everyone, but expect to see a lot of questions relating to your family’s financial situation.
Once you’ve completed the application, you’ll receive a document called a Student Aid Report, which includes all the information you included in the application and an estimate of how much you can receive in federal student loans and financial aid grants. You should closely look over the SAR to make sure there are no mistakes because it could mean you’re getting less money than you should be getting.
Finally, once you've seen your options and how much you'll be getting, you can decide what federal financial aid you want to accept/decline. This includes financial aid grants (free money), work-study, and federal student loans. This is the most important part because this is where you see how much you’ll actually have to pay out of pocket to get an education. Make sure you spend a good amount of time reviewing your options, explore all possible alternatives, and talk with a counselor/teacher, and of course, discuss it with your parents. The goal is to receive as much as you can in grants and scholarships and take on minimal loans.
Remember, the amount you receive depends on several factors, so there's no one dollar amount that you’ll receive. It’s important to fully understand your situation, and account for all the factors present when paying for an education, including your parent's financial situation, your intended major, your plans for the future, your intended career, and so on. All of these factors play a role in the affordability of college so they're important to consider.
With all of that said, I hope you enjoyed this article and have a better understanding of the federal financial aid application process. If you’re reading this while you’re applying for college, I wish you the best of luck. Thank you for reading, and I will see you next week!