Financial Aid – What’s It All About?
The term financial aid has evolved to include anything that makes up the difference between what a student pays and a college’s published price. Financial aid can be a government grant, a subsidized loan, a collection of private scholarships, or a tuition discount offered by a college. All of these items, taken together, are considered financial aid.
We’re Talking Billions Here
Last year, $40 billion came from various government programs to help students pay for college. Another $9 billion came from colleges themselves, usually in tuition discounts. That’s a whole lot of aid out there! Some of it is waiting for you.
The FAFSA
Applying for financial aid takes time, true. But it takes much less time than applying to get into a college. The forms may seem intimidating when you first pick them up, but check out those questions. All they’re asking for are numbers. No essays, no personal statements on meaningful experiences, and no lists of activities in order of their importance to you are required. All you have to do is dig the numbers out and write them down.
The Too Rich Myth
This may be the most prevalent myth of all. Too many times I’ve heard otherwise intelligent students and adults say they aren’t eligible for financial aid because they or their parents make too much money. And these are the people with $100,000 incomes.
You may be surprised to know that many individuals with six-figure incomes are receiving financial aid. If you aren’t in the six-figure range, even better for you, as you will get some of the best aid.
Anyone of the last 20 years knows what a student loan is. You borrow money at a low interest rate to pay for college and then spend 10 years repaying it. Such a loan is considered financial aid because someone else – usually the government – is paying interest on the borrowed money while you’re in schools and subsidizing the interest rate to below-market levels when you start repaying.
Last year, student’s borrowed almost $40 billion in subsidized loans. Uncounted billions more are distributed in private scholarships. You may have to borrow some money to attend the college of your choice, but a lot of money out there is being given away.
Still, you won’t get any money unless you ask for it. Asking means filling out forms.
