“It’s Not Too Late To Find The Money
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Important Details About The Financial Aid Process

Week 1 of 12

Let’s start at the beginning, shall we? The fact of the matter is there are people who disagree on where the beginning starts when it comes to the financial aid process. Just about everything your child has done to this point can affect the financial aid award they receive. Grades they have earned, clubs they have joined, activities they have participated in, and organizations they have volunteered for all impact how schools look at them. All of those factors and many more will affect the amount of financial aid available for your child.

Why don’t we start with the FAFSA (Free Application for Federal Student Aid). This is where the whole financial aid process starts to get very real for a lot of families. You need to fill out this form each and every year for each and every student to be eligible for any form of federal aid including grants OR loans.

Fill out the FAFSA in early January using estimated numbers if need be. Complete them online, you can always go back and update the numbers later! Once you submit your FAFSA, you can sit back and relax-at least for a while. The financial aid administration will read through your application, grapple with your numbers and calculate how much financial help you should receive towards your child’s education-and how much you should pay yourself.

The next stage of the application process is very important.

This is what you can expect to happen next:

1. You’ll Get A Response About The Pell Grant

When you completed the FAFSA, the form included an application for the Pell Grant, the government’s biggest financial aid program. Each year, the government doles out $12 billion to around five million students to help them pay for college tuition using Pell Grants. While that sounds like a lot of money, it’s worth remembering that the bulk of that cash goes to families who earn less than $30,000 per year. The Pell Grant isn’t intended to help everyone pay for college; only children from the very lowest-income families. In fact, even qualified applicants only receive about $2,400, which doesn’t go very far in filling the college tuition gap.

So if you find that you don’t qualify for a Pell Grant, don’t sweat it. There’s a basket-full of other methods that you can use to find the money you need–and as Certified College Planning Specialists, we will help you find them.

2. You’ll Receive Your EFC Estimate

The most important part of the Student Aid Report is at the top of the page. This is where you’ll find an estimate of your Expected Family Contribution (EFC), the amount of money that the government thinks that you should pay for your child’s education.

Now, when you completed the FAFSA, you were asked a ton of personal questions. Not one of those questions asked how much you think you can afford to pay. It’s a shame because that question you could have answered easily. Chances are, the financial aid administration will have got it wrong; the amount that they think you can afford will usually be much, much higher than the amount that you think you can afford.

If you’ve already received your Student Aid Report (SAR), you already know exactly what I mean. If you’re still waiting for it, you should bear that in mind before you open the envelope. You’re not likely to see a big fat zero there. It rarely happens.

The vast majority of parents take one look at the EFC figure and wonder how and where are they going to find that money. That’s the next stage of the college process.

In the first stage of applying for financial aid, you gathered the information and completed the forms. In this second stage, you have to find the money. This is as much a part of going to college as taking ACT’s and choosing a major. There’s a whole range of specialized loans and grants that you can apply for, including some with very low interest rates and payments deferred until after your child graduates. Many, if not most college students use them, and they’re a great way of raising the extra cash at very good rates.

Grants and loans aren’t the only method you can use though. Another method that makes paying for college far easier than you might imagine is a special mortgage technique that gives you the money you need on a tax-favored basis. This method doesn’t work for everyone but if it does work for you, you should be able to kiss your EFC headache goodbye. If you’d like to know more about this technique-and find out if it will work for you-or if you’d just like to learn more about all the other grants and loans available for college students and their families, just give my office a call at (908) 857-4200. We’d be happy to arrange an appointment for free diagnostic evaluation if you have not already completed one (this is a $300 value!)

3. You’ll Hear From Private Schools

The FAFSA is the financial aid application form for public schools. If your child is applying to certain private schools, you should also have completed a CSS/PROFILE. This form will list all of the schools where your child is applying. It’s the job of the College Scholarship Service (CSS) to send copies of the profile to every one of the schools on the list.

About a month later, you should begin receiving acknowledgement forms from each of the schools confirming that they have received your information. The number crunchers at these schools will now be producing their own version of an EFC. If there are any more schools that your child is considering attending, this is the time to review the list and make the additions. You still have time.

4. You’ll Receive A Data Confirmation Report

In addition to hearing directly from the schools confirming that they’ve received your application, you’ll also receive a Data Confirmation from the College Board, which will summarize all the information that you’ve submitted.

You should check this report very carefully. You won’t get another chance to make any corrections so you should make the effort to confirm each detail on the report. Remember, the numbers you see on the report will be the ones that the committees will be using to calculate your ability to pay. You don’t want to find that you have to pay a few extra thousand dollars simply because you missed a typo in your application!

During the next few weeks, you can expect to receive a fair amount of college related mail. It won’t just be your local post office that is working over time. You’re also going to have a ton of chores to complete if you’re going to get the most out of the college process.

This is what you’re going to have to do as the reports and results start coming in:

1. A Lot Of Double Checking

Your Data Confirmation Report isn’t the only document you’re going to have to review carefully. Your SAR will also need a fair amount of close attention. It’s certainly possible that there are mistakes there that you haven_’t spotted.

In Part I of the SAR, you’ll find a large amount of information. In Part II you can submit changes to the information listed in Part I. You can also add any additional schools that your child has recently chose to consider. This happens quite frequently. Grades can go up, opening the possibility of new ‘reach’ schools and students may think twice about studying at a school that is a four-hour plane flight from home. If you have changes to make to your applications, this is the time to do it.

2. Submit Your SAR Yourself

The financial aid administration will submit your SAR to all the schools your child is applying to, but it’s also a good idea to send in a copy yourself. With millions of applications zipping around, you don’t want yours to get lost in the crowd. It doesn’t hurt to back them up, it could make the difference between an ivy-league school and a local college.

3. Talk To The Financial Aid Offices

After you receive your SAR, you should call each of the financial aid offices and ask them if they need any more information. Some will want copies of your latest tax return; others might ask you to send in copies of your tax return-and a few could ask you to complete the college’s own financial aid form. (Just when you thought you’d seen the last of them!)

If you do have to complete more forms, make sure that the information you submit is the same as the details you put on your FAFSA and PROFILE. Inconsistencies here could cause expensive problems and delays.

4. Look For Funding

Here is where you should find out how much money you’ll need to pay. You’ll then have to find out how you’re going to pay. That’s a whole other ball game.

Very few families, even the top earners, have the kind of cash flow that allows them to pay an extra five, ten or twenty thousand dollars a year without blinking an eye. Almost everyone will have to find other sources of cash. Fortunately, there are plenty out there and we can show you how to find them.

For those of you who have not taken advantage of our FREE Diagnostic Evaluation, don’t wait another minute! We will explain how to find all the money you need and how to pay for your child’s education. To book a FREE Diagnostic Evaluation, just call my office at (908) 857-4200 and we’ll be happy to help.

This is a great time to get ahead. Call my office today at (908) 857-4200.

Ian Welham, CCPS
Certified College Planning Specialist
(908) 857-4200
Email: Ian@CompleteCollegePlanningSolutions.com

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Haven’t read earlier articles in the series?

Go to part 7

Go to part 6

Go to part 5

Go to part 4

Go to part 3

Go to part 2

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Ian R. Welham, Certified College Planning Advisor  -  Tel: 973.467.0101