Financial aid is funding that helps college students pay for higher education expenses such as books, tuition, housing, meals, and supplies. It often takes the form of scholarships, grants, loans, and work-study programs.
How Does Financial Aid Work?
Financial aid helps cover the costs of college so that families do not have to pay them in full. It can come from various sources including the federal government, state agencies, community organizations, corporations, private institutions, high schools, and more. It often comes in the form of scholarships, grants, loans (both private and federal), and work-study programs.
Types of Financial Aid
Financial aid comes in different forms and aims to help in various ways. However, you do not have to choose just one type of aid. Often you can combine multiple types to cover your expenses.
Grants
Grants are need-based aid programs that provide free money to students to cover higher education expenses. One of the most common need-based grants is the Pell Grant, which is usually awarded to undergraduate students who demonstrate a high level of financial need. Grants are also offered from various non-governmental sources. In most cases, the money awarded from grant programs does not need to be repaid as long as program requirements are met.
Scholarships
Scholarships are financial aid programs awarded to students who meet criteria set by the granting organization. Scholarships can be need-based or merit-based.
Work-Study Programs
Work-study programs provide part-time jobs for eligible college students to help pay for their education. Federal work-study programs encourage work related to your studies or work that serves the community. To qualify, you must:
- Be a student in undergraduate or graduate/professional studies
- Demonstrate financial need
- Be enrolled in a school that participates in the federal work-study program
Federal Student Loans
The federal government offers a variety of student loans that can be used to pay for college expenses. Although you will pay interest on these loans, they can offer benefits compared to private loans such as fixed interest rates, repayment programs, deferment options, and income-based repayment plans. Private student loans may also be an option; however, they do not offer the same features and protections available in federal student loans.
How to Apply for Financial Aid
You can apply for financial aid by completing the Free Application for Federal Student Aid (FAFSA). The FAFSA is a form used to determine your eligibility for financial aid from the federal government, numerous state governments, and most colleges.
When submitting your FAFSA application, there are several factors that determine your eligibility, including:
- Your family size
- Your year in college
- The cost of attendance
- Expected Family Contribution (EFC), which is calculated based on your family’s income, assets, and benefits
FAFSA applications open on October 1st each year for the next academic year and close on June 30th at 11:59 PM Central Time (or 12:59 AM Eastern Time) at the end of each academic year. For the 2022-23 academic year, FAFSA applications became available on October 1, 2022, and must be submitted by June 30, 2023, at the latest. It is best to apply as early as possible but not later than the deadline for the academic year.
After submitting your application, you can check your status using the Federal Student Aid ID (FSA ID) you receive. You will then receive your student aid report. Your student aid report will explain all the types of aid you qualify for, the amounts of each, and the remaining costs you can expect to pay for the year. If you are considering more than one college, you will be able to review the aid offers from each college and accept the one that fits you best.
It is recommended
The financial aid office at the college you have chosen typically applies the aid to your outstanding balance and sends you the remaining balance. If you still have a financial need, you can seek financial assistance from organizations that offer programs not listed in the student aid report.
Are you eligible for financial aid?
Financial aid can help reduce the costs of college education, thus
Source: https://www.thebalancemoney.com/what-is-financial-aid-5192809
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