Plan ahead when applying for college financial aid
While the cost of college tuition keeps rising, some analysts are predicting financial aid to students from cash-strapped states will show little or no growth in the coming years. If you or your college-bound child plan to apply for financial aid, here are a few things you should know.
• Apply sooner instead of later. Although you can apply between January 1 and June 30, some schools have deadlines as early as January or February. So the sooner you file after January 1, the better. What’s more, because schools and states have limited financial aid to distribute, many types of financial aid are awarded on a first-come, first-served basis. Students who apply earlier and prove their need for assistance tend to receive more generous aid packages that include more state and college grants and work-study programs, as opposed to just loans.
• Visit www.fafsa.com to learn more about federal financial aid or www.fafsa.ed.gov to fill out the Free Application for Federal Student Aid (FAFSA).
• Consider appealing for more aid. If you receive an offer for financial aid, you don’t have to accept it. You can appeal for more aid. Financial aid officers will then review your application and financial situation more closely. This can lead to more aid, especially if a parent has experienced a job loss or if your family has incurred significant medical expenses.
• Keep in mind that money borrowed must be repaid to the government once the student finishes school. Grants do not have to be repaid. What if you don’t qualify for financial aid? According to the College Board’s Trends in Student Aid 2010, most students receive financial aid. In 2009-10, more than $154 billion in financial aid was awarded to undergraduate students with full-time undergraduate students averaging around $11,500 in aid, including more than $6,000 in grants. That said, if your child doesn’t qualify for financial aid, there are a variety of different ways you can approach funding his or her college education. Consult with a financial advisor for help identifying the best solutions and strategies based on your financial situation.
James C. Hanna, CFP®, MBA, Financial Advisor, CERTIFIED FINANCIAL PLANNER ™ practitioner. Advisor is licensed/registered to do business with U.S. residents only in the states of Kansas, Missouri, Colorado, Nebraska, Oklahoma, Texas and Indiana. Brokerage, investment and financial advisory services are made available through Ameriprise Financial Services, Inc. Member FINRA and SIPC. Some products and services may not be available in all jurisdictions or to all clients. © 2011 Ameriprise Financial, Inc. All rights reserved.