Financing A College Education

1
Financing A College Education

• 2007-2008
• Financial Aid,
• Tax Benefits,
• and more

2
Financing Your Education

• Determining Eligibility/FAFSA
• Definition of Financial Need
• What is Financial Aid? Description of Financial
  Aid Programs
• Timelines
• Payment options
• Other Benefits to Consider
• Website Information

3
Determining Financial Eligibility

• Complete the 2007-2008 FAFSA (Free Application
  For Federal Student Aid)
• Available on-line at www.fafsa.ed.gov after
  January 1, 2007
• Apply for a PINs www.pin.ed.gov
• FAFSA calculates EFC (Expected Family
  Contribution) and determines financial need

4
Financial Eligibility Cont.

• Goal of Financial Aid Assist students by
  evaluating familys ability to pay for education,
  distribute limited resources in an equitable
  manner.
• Calculates EFC by using AGI, parent and student
  assets, in family college, age of oldest
  parent, etc.
• Uses 20 student assets assessment rate, 12
  parent
• 30 selected for verification
• Re-apply each year
• Student Aid Report (SAR) review results/correct
  if necessary

5
Definition of Need

• Cost of Attendance (COA)
• - Expected Family Contribution (EFC)
• Financial Need/Eligibility
• Estimated EFC calculator at
  www.ohe.state.mn.us

6
Cost Of Attendance

• Tuition and Fees
• Room and Board
• Books, supplies, transportation and
• miscellaneous personal expenses/computer
• Loan Fees
• Study Abroad Costs

7
Independent vs. Dependent

• Born before January 1, 1984
• Graduate or professional student
• Married
• Has legal dependents other than spouse
• Orphan/ward of the court
• Veteran of or currently serving on active duty in
  US Armed Forces
• Determined to be indep by FA office

8
FAFSA Tidbits

• Needed items to complete SSNs, drivers license,
  2006 federal taxes, asset info, Pins
• Males must register with Selective Service
• Question 31, MUST ANSWER!!!!!
• Do not list value of home you reside in.
• Parent marital status, who files the FAFSA?
• Investments, must report college savings
  pre-paid tuition plans owned by parent
• Business/Farm value, new exclusions

9
What is Financial Aid?

• Gift Aid
• Grants (need-based)
• Scholarships (merit)

• Self-Help Aid
• Loans
• Employment Opportunities

10
Gift Aid

• Grants
• Institutional
• State
• Minnesota State Grant, 100 - 8372
• Federal
• PELL Grant, max award 2007-2008 4050
• (90 pell awarded to incomes below 45,000)
• SEOG, awards range between 100-4000
• ACG/SMART, 750 fy, 1300 2nd yr, 4000 smart

11
Gift Aid

• Scholarships
• Institutional Scholarships
• School/Local/Community Scholarships
• National Scholarships
• Search the Web www.Fastweb.com
• Parent/student place of employment

12
Scams

• Never pay for scholarship or scholarship
  applications
• Fin Aid Seminars/Consultants must sign fafsa
• www.fafsa.com DO NOT USE!!! Never pay to
  complete the FAFSA, its free!
• Contact a financial aid or guidance office for
  advise if your uncertain.
• www.ftc.gov/scholarshipscams

13
Self-Help Aid

• Loans
• Federal Perkins Loan (5), max 4000
• Federal Stafford Loan (6.8) 3500(first-year)
• SELF Loan (7), max 6000 (first-year)
• Alternative/Private Loan 6 - 10 credit-based
• PLUS Loan 8.5
• Student Employment Opportunities

14
Time Line

• Apply and be admitted to colleges/ universities
• Research and apply for scholarships
• Complete your FAFSA after Jan 1, 2007
• FAFSA processing can take between 10 days to 2
  weeks.
• Check with each school to determine if
  additional forms are needed for a complete
  financial aid file.
• Most Colleges/Universities begin awarding in
  early to mid-March

15
Payment Plans

• Pre-payment plan
• Installment plan
• Semester plan
• Lets Make a Deal plan
• Other

16
Tax Benefits

• Hope Tax Credit claim up to 1500,
• first second years in school
• Lifetime Learning Tax Credit claim up to 2000,
  third year in school and up.
• Student Loan Interest Deduction
• max 2500

17
Tax Benefits Cont.

• Employer-Paid Tuition Assistance
• Deduction of Higher Ed Expenses
• up to 4000, AGI limits

18
Tax Preferred Savings and Investment Options

• 529 College Savings Plan tax free, matching
  grant, 12/2010 expire tax benefits
• Coverdell Education Savings(Educational IRA)
  grow tax-free till withdrawn, AGI limits.
• Penalty-Free IRA Withdrawals avoid 10 tax on
  traditional or Roth IRA withdrawals for education
• Educational Savings Bonds series EE or I
• exclude interested earned from income

19
Popular Web Sites

• www.fafsa.ed.gov FAFSA
• www.pin.ed.gov FAFSA pin number
• www.fastweb.com Scholarship Search
• www.ohe.state.mn.us State of MN financial aid
• www.finaid.org Financial Aid
  Info/Scholarships
• www.mnsaves.org MN 529 Savings Plan
• www.irs.gov IRS
• www.studentaid.ed.gov US Dept of Ed Financial
  Aid
• www.ed.gov US Dept of Education

20
Questions?

• How to contact me
• Cheryl Dooley
• Associate Director Financial Aid
• Hamline University
• cdooley_at_hamline.edu
• 651-523-3000 or 1-800-888-2182