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What is Financial Aid?

This is the most important advice you need to know about how to get college funds.

According to Ipsos and Sallie Mae, families spent an average of $26,373 to pay for college in the 2020-21 school years, according to their 2021 survey. Nearly half (49%) of this amount came from financial assistance. These data show that college is costly and that financial aid is required to pay for it.

What is Financial Aid?

Financial aid refers to any college funding that is not provided by family, personal savings or earnings. This can be in the form of grants and scholarships, work-study positions, federal loans, or private loans. You can use financial aid to pay for most expenses related to higher education, such as tuition, fees, room and board and books and supplies.

There are many sources of aid. These can be federal and state agencies, colleges and high schools, community organisations, foundations, corporations, as well as other sources. Financial aid will be determined by both the rules of the different sources and federal, state, or university guidelines.

Get started early

It’s never too late to plan for college, whether you are a student in the future or a parent. The U.S. Department of Education’s Office of Federal Student Aid has a College Preparation Checklist. This checklist will guide you from where you are now, whether you’re in elementary, middle, or high school, to where you want to be: college with a plan for paying for your education.

Ask your counselor at high school about any aid available from local or state organizations. This includes grants and scholarships that could be awarded while still in high school. You will need to declare any aid received outside of college. This will affect the amount of federal, state and college aid that you are eligible for. However, it will not reduce the amount you will need.

Be aware of the deadlines for financial aid applications and make sure you don’t miss them. To help you find financial aid, use the DOE checklist and the information in this article.

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Merit-Based Aid vs. Need-Based Aid

There are two major types of financial aid: need-based and merit-based. The awarding organization will assess your ability to pay college costs and determine if you are eligible for need-based aid. Merit-based aid can be awarded for exceptional talent or demonstrated ability in academics or athletics, as well as music or other areas.

It doesn’t matter if your financial aid was merit-based, need-based, or both. This does not mean that you will have to repay it. This is dependent on the type of aid received. For example, most grants and scholarships do not require repayment. Most loan moving do.

Two Important Application Forms: FAFSA Profile and CSS Profile

As you go to college, there are two main routes to financial aid. The U.S. Department of Education offers a free application for federal student aid (FAFSA). This is required to be eligible for federal aid and most state and college assistance.

The College Board sponsors the second, the CSS Profile. It is used by approximately 400 private colleges and universities to allocate non-government financial aid.

Each form has its own deadlines. See details below. Even if you aren’t sure you will be eligible for federal financial aid, you should still submit the FAFSA. The reason is that you might be wrong and that even if you are right, the FAFSA must be submitted for all local, state and individual school financial aid. This includes merit scholarships. The CSS Profile you submit will depend on the type of financial aid you are applying for or the school where you intend to study.

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FAFSA: Breaking down

For the next academic year, make sure you submit your FAFSA by October 1. For example, you could have submitted your FAFSA on October 1, 2020 for the school year 2021-22. Even though the deadline for federal submission is June 30th of an academic year (in this instance June 30, 2022), it will be too late to receive most financial aid. It is likely that the deadline for most colleges and states to brother loan disperse aid will be extended.

Your FAFSA must be renewed for every academic year that you are enrolled in school. Otherwise, you won’t be eligible for federal financial aid (including any renewable aid) for the next year. You can maximize your access by renewing your FAFSA in October of the year prior to the academic year for which you are applying. This is the same as what you did for your first year of college.

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Because you retain a lot of your demographic and personal information, the renewal process is often easier and quicker than the original. It is important to verify the accuracy of your FAFSA, but it is free to renew or submit it.