Whittier Union High School District

To Achieve and Maintain Excellence

Financial Aid Basics

Finacial Aid BasicsMost people need some type of financial aid in order to pay for college. There are several types of aid available, which differ in how they are awarded and paid back:

Learn more about eligibility for federal financial aid, the FAFSA(applying for financial aid), federal tax benefits, private loans, other types of financial aid and other resources about financial aid.


Grants

Grants are a form of gift aid meaning you wont need to pay the money back. Theyre usually awarded based on financial need and sometimes on merit. Many of the colleges where youre applying may offer grants, and the federal government has several that you may be eligible for:

  • Pell Grant. Students with the most financial need can receive up to $4,731 for the 2008-09 school year.
  • Supplemental Educational Opportunity Grant (SEOG). This grant is awarded to students who are eligible for a Pell Grant who demonstrate the most financial need. You can receive between $100 and $4,000 a year, depending on when you apply, your financial need, the funding at the school you're attending, and the policies of the financial aid office at your school.
  • Academic Competitiveness Grant. To receive this grant, you must be a first-year and second-year student, eligible for a Pell Grant, and graduated from a rigorous high school curriculum.
  • National Science and Mathematics Access to Retain Talent Grant (National SMART Grant). To receive this grant, you must be a third-year or fourth-year student, eligible for a Pell Grant, and majoring in physical, life, or computer sciences, mathematics, technology, engineering, or in certain foreign languages. You also must maintain at least a 3.0 GPA in coursework required for your major.
  • Ed Fund provides student loan guarantee services to colleges, universities and career schools, working closely with both financial aid administrators and lenders. We are a nonprofit, public benefit auxiliary of the California Student Aid Commission, but we provide our services across the United States. In fact, Ed Fund is the second largest guarantee services provider in the nation for the Federal Family Education Loan Program.
  • The California Student Aid Commission is a state agency dedicated to making education beyond high school financially accessible to all Californians. The Commission provides a variety of programs to benefit students, including outreach to help students understand their options and financial assistance to make postsecondary education possible.


Scholarships

Scholarships are another form of gift aid. Scholarships are usually given for achievements in academics, arts, or athletics. Some might be based on financial need. There are so many scholarships available, which means its likely you qualify for some. Searching online is a great place to start, and these websites can help:

  • Collegeboard.com. This online tool created by College Board can help you locate scholarships, internships, and grants, which match your education level, talents, and background.
  • Fastaid.com. This online tool contains millions of sources for scholarships, fellowships, and grants. It was created by the author of "The Scholarship Book" from Prentice Hall.
  • Fastweb.com. Another place to look for millions of scholarships, Fastweb provides personalized matching of scholarships depending on your interests, talents, and career goals.
  • Petersons.com. Petersons scholarships search contains millions of scholarship listings worth billions of dollars. Plus, you can search based on specific criteria.

Federal Work-Study

You can earn money to help cover school expenses through the Federal Work-Study program, which provides part-time jobs to students, often on campus. Work-Study is awarded based on your financial need.


Federal Student Loans

There are four main types of federal loans available to help you and/or your parents pay for college:

  • Perkins loans are low-interest loans offered to students with the most financial need. The federal government pays the interest on Perkins loans while you're enrolled in school at least half-time.
  • Subsidized Stafford loans are low-interest loans offered to students with significant financial need. The federal government pays the interest on subsidized Stafford loans while you're enrolled in school at least half-time.
  • Unsubsidized Stafford loans are low-interest loans available to all eligible students, regardless of financial need or family income. Youre responsible for paying the interest on unsubsidized Stafford loans as soon as the money is received. Just like with Subsidized Stafford Loans, you dont have to start making payments until 6 months after you leave school.
  • PLUS loans are low-interest loans available to parents of dependent students and to graduate and professional students. PLUS loans may be helpful if you still have uncovered expenses after adding up all your financial aid and borrowing the maximum amount in Stafford loans.

Eligibility for Federal Financial Aid

To be eligible for federal financial aid, you must:

  • Be a citizen or eligible non-citizen
  • Have a high school diploma or a General Education Development (GED) certificate
  • Be enrolled at least half-time in an institution that participates in the financial aid program
  • Be registered for Selective Service (applies only to males 18-25)

The FAFSA

The Free Application for Federal Student Aid (FAFSA) is an application that all students must submit in order to be eligible for most types of aid.

The FAFSA asks you questions about your finances and your family's finances from the previous year. Schools use this information to determine what type of financial aid you're eligible for, for example, grants, work-study, and federal student loans. Because the FAFSA requires information from your parents, you should enlist help in completing it.

You will need to complete a FASFA every year you need financial aid. You can complete it online at www.fafsa.ed.gov. If you can, it's a good idea to complete it online because you can easily reuse information from previous years, making the renewal process simple.

You need to complete the FAFSA as soon as possible after January 1 of the year in which you think you'll need financial aid. And even if you don't think you'll need or qualify for financial aid, you should apply anyway. You never know.

Private loans are offered by lenders directly to students and their parents. Private loans are useful for bridging the gap between the cost of college and the amount of other financial aid available. In general, it's a good idea to max out all other types of financial aid before taking out a private loan.


Federal Tax Benefits

In addition to the traditional forms of financial aid, there are a number of tax benefits available to offset the cost of education. Parents and some students who pay for college and pay taxes in the same year may qualify for generous federal and state education tax benefits. These include:

  • Federal Tax Credits. Tax credits directly reduce the federal taxes you owe. For example, if you owe taxes at tax time, a credit is a dollar-for-dollar reduction of the amount you owe.
  • Federal and State Tax Deductions. These benefits reduce your taxable income. By reducing your taxable income, a deduction may also reduce the taxes you owe.

Private Loans

If the financial aid you receive from grants, scholarships, and federal programs doesnt cover you total cost of attendance, private loans might be an option to consider. There are many lenders and many loan options, so be sure to research your options before you apply. Be careful to look at and understand the interest rates and the terms of agreement. Apply in time to receive the funds before your school year starts.


Other Types of Financial Aid

You might be interested in participating in a program during or following college that will provide funds to pay for college:

  • Armed Forces. The military has programs that provide you with money for college in exchange for service. The Montgomery GI Bill provides money that active-duty members of the armed forces can use towards higher education. The Reserve Officers Training Corps (ROTC) also gives you money to pay for college. You learn skills for the military while in college and serve for four years after graduation. Each branch of the service also offers its own scholarships.
  • Peace Corps. The Peace Corps gives individuals the opportunity to volunteer in foreign countries. Volunteers with Perkins loans are eligible for a 15 percent cancellation of their outstanding balance for each year of Peace Corps service. The Peace Corps is a full-time commitment, so people volunteer after theyve graduated from college.
  • AmeriCorps. The AmeriCorps program provides money for education (currently up to $4,725 per year) in exchange for community service. Its similar to the Peace Corps, except you volunteer in the United States. There are opportunities to volunteer full- or part-time over a 10- to 12-month period, either before or after college.
  • Benefits for Teachers. There are several financial aid opportunities available to students who go into teaching. For example, people who teach in low-income schools or in certain subject areas are eligible to have parts of their federal loans canceled. People who teach in areas where there are teacher shortages may qualify for deferment or forbearance of loan payments.

Resources about Financial Aid

  • Studentaid.ed.gov. The official home page for the federal student aid programs administered by the US Department of Education.
  • FastWeb.com. Make sure youre getting some of the millions of dollars available in scholarships! This free scholarship search engine is a great place to begin your search.
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