According to the College Board, nearly 60 percent of the students currently enrolled in colleges and universities are receiving some financial aid. Many people assume that their income is too high to qualify for financial aid, and in many cases that may be correct. However, even if it appears intuitively that a family’s income is too high to qualify for financial aid, application for financial aid should still be submitted due to the methodology used in evaluating other asserts and liabilities and the total number of children attending college.
Many years ago it was recognized by the federal government that a college education is too expensive for many families and that the federal government had a special role in financing education, to make it available to all, regardless of resources. As a result, over the years, a number of programs have been developed to provide general assistance. Financial assistance is now well entrenched in the nation’s college funding system. While some feel reluctant to apply for financial aid, it should be remembered that it is funded by income taxes paid by many of those same persons.
All applicants for federal student aid must complete the Free Application for Federal Student Aid (FAFSA) and file it with the College Scholarship Service (CSS). Depending upon the college or colleges at which application for admission is begin made, the FAFSA may be the only form that needs to be completed. However, in order to apply for state scholarship or grant programs and for aid at many other colleges and most private scholarship programs, other forms may have to be filed. Many colleges and universities, for purposes of awarding their own private funds, require the CSS/Financial Aid PROFILE.
Within a few weeks of filing a FAFSA, the applicant will receive a Student Aid Report (SAR). This form should be carefully reviewed and corrections made as necessary in order to obtain a revised SAR. If a PROFILE form is filed, the applicant will receive an Acknowledgement and a Data Confirmation Report. As with the SAR, the applicant should carefully review the information and make corrections as required.
How Financial Aid is Determined
The presumption made in determining a family’s need for financial aid is that the family is considered the primary source of funds for college and is expected to pay its fair share of the cost of a college education. How, then, is a family’s college education financial need determined? First, there are three factors:
• The amount that the family is judged capable of contributing to the student’s college education costs
• The cost of attending a particular college or university
• The resulting difference, if any, or the amount of need
To determine the extent of the assistance required, financial aid administrators use a formula determined by the federal government, better known as the Federal Methodology. It takes into consideration earned income, unearned income, assets, expenses, family size, age, and other factors. It does not consider the value of the family’s home in arriving at a family’s total assets nor does it consider the income of a divorced, noncustodial parent in determining total income.