Maybe you missed it in my last e-newsletter, but did you know that February is Financial Aid Awareness Month? Sponsored by the National Association of Student Financial Aid Administrators (NASFAA), its goal is to spread awareness and information about the importance of financial aid. Big deal, you might say, because you think it doesn’t have anything to do with you.
There is plenty of time for high school juniors and their parents to learn about financial aid, because you don’t have to worry about filing the FAFSA until October, right? So why waste time now when you already have your heart set on attending the perfect college for you, no matter how much it costs? But that is the whole point of setting aside a month to help families focus on the importance of financial aid in the college planning process.
It is never too early to start learning about financial aid because it really does tie in closely with deciding which college to attend. In addition to the importance of finding a college that is the right personal choice for the student, families really need to consider whether it is the right financial choice as well. They must take into consideration what their total costs will be to attend a particular college, learn about financial aid and how it helps reduce some of those costs, and then think about the cost-benefit ratio of paying for a college versus the benefit of a degree from that school.
Too many families do not really take the whole financial question seriously, and end up relying on student and parent loans to help cover the costs of attending college. Those with several students in college at the same time are particularly hard hit if they make poor financial choices. After graduation, parents and students may find themselves burdened with heavy student loan repayment obligations, which can affect everyone’s financial future.
That is why I advise my students to learn about financial aid as soon as possible. I start my classes early, in the spring of the year, so we can align money with the selection process. Many students have been accepted into top-quality schools with a financial aid package that meets their family’s capabilities.
So how does Financial Aid Awareness Month fit into this picture? For starters, I would spend some significant time on the NASFAA website to learn about financial aid, find out who provides it, and learn whether you will be eligible. Then look at financial aid options in your state, and think about ways to cut your costs. And be aware that there are tax breaks which might help your family save some money.
You will learn that two critical mistakes in the college selection process are assuming you can’t afford college, or assuming you don’t have to worry about the cost of college. Although you don’t want to get discouraged by the sticker price of college until you know how much financial aid may be available, you do want to keep an eye on cost as you narrow down your college list. Two factors are generally used to determine who gets student aid and how much they get: need and merit. “Merit-based” aid is given to students based on capability or career trajectory, while “need-based” aid is given to students who demonstrate a lack of financial assets to pay for college. Also check out the website for Helpful Financial Aid Resources including:
• Financial Aid Frequently Asked Questions
• When to Complete the FAFSA, and FAFSA Tips & Common Mistakes to Avoid
• Eligibility for Financial Aid
• Student Aid Tips for Unique Student Populations
• Sources of Financial Aid
• Help with Loan Repayment and Managing Finances
Although it might seem like there is plenty of time to fit everything in, be aware that financial aid deadlines for federal, state and institutional aid can occur as early as November and December. You want to make sure you are ready to submit the FAFSA right after it comes online October 1, so you’ll get your financial aid offers early, and can include them in your decisions.