Financial Aid for College Students

Whether it's your first time filing for financial aid and you need to know how to get the ball rolling, or it's just one more thing on your to-do list, we're here to help you find financial aid for undergraduates! Believe it or not, getting money for college is not as confusing or complicated as you might think. Use this Financial Aid for College Students guide to help you understand the ins and outs of finding money to help cover the costs of school.

Start with the Flowchart

You're probably stressed just thinking about how you'll cover the rising costs of tuition, but we're here to tell you to relax because we've got you covered. Before you dive into the rest of this guide, start by visiting our financial aid flowchart. We know every student's situation is a bit different, so we put this infographic together to help walk you through every possible option you have for paying for school, step-by-step.

Financial Aid Flowchart

Explore this interactive chart as a starting point. Answer the simple questions with a "yes" or "no", and let it steer you to the next logical financial aid option to explore. We hope it will provide you with a solid foundation and help you find the optimal path to funding your education.

The Basics

There are a few basic points that every college student should know about financial aid:

  • First, apply for federal financial aid with the FAFSA even if you think you won't qualify. There are many variables involved in determining eligibility. You'll never know if you don't try.
  • Second, because the FAFSA is used by many non-government aid programs in order to determine your eligibility for scholarships, student loans, work-study and other programs they offer, you can't figure out if you're eligible until you file the form. This reinforces the first point that completing and submitting the FAFSA is essential, even if you don't think you will qualify for federal financial aid.
  • Finally, the FAFSA is your application for federal student loan programs. If you don't file a FAFSA, you won't be able to take advantage of these low cost loan programs.

If we didn't drive that message home strong enough, here are three more advantages to completing the FAFSA:

  • You may be eligible for non-federal aid
  • If you don't need a federal student loan now, the paperwork is done in case you situation changes
  • You might actually qualify for federal grants. Like we said before, there are a lot of factors that go into determing eligibility and it's better to know for certain than to guess.
Filing the FAFSA

The quickest and easiest way to file the Free Application for Federal Student Aid (FAFSA) is online. Be sure to get your PIN at the PIN Site so that you can sign your FAFSA electronically. Complete the FAFSA as soon as possible after January 1st of the year in which you will need funding.

Tip: If you or your parents have not completed federal income tax returns yet, use estimates from pay stubs and bank statements.

If you or your parents’ income has not changed significantly, you have a choice. You can use the amount of tax you paid last year or you can estimate. Here’s an easy way to estimate the amount of tax you owe:

  1. Take the line item from your federal income tax return titled “This is your total tax.”
  2. Divide it by your adjusted gross income.
  3. Multiple this number by your estimate of this year’s adjusted gross income to obtain an estimate of the amount of you tax owe.
Other Forms You May Need to Complete
CSS Profile

College students may also need to complete the CSS Profile Application. The College Board administers the CSS Profile to give financial aid administrators more information to determine your eligibility for need-based assistance and funding directly from the school. Some private colleges require students to complete the profile in addition to the FAFSA and when they do, it's usually only used for freshmen.

The CSS Profile must be completed before you file the FAFSA, usually in the middle of October of the year prior to the year you'll need funding. Contact your college to see if you are required to complete the CSS Profile. If so, register and apply online here.

Institutional Aid Applications

Some schools require undergrads to complete a form they provide you. This is called an institutional aid application. On this form you may be asked to inform the college about outside scholarships you expect to receive and whether you're interested in other types of aid, such as work-study. Many times you can use this form to explain any special circumstances not taken into account on the FAFSA (e.g. an unexpected recent loss of income or extraordinary medical expenses). Your school will let you know if they require such a form.

Financial Aid Eligibility
Financial Need

Financial Need is a term used to describe how much need-based financial aid you're eligible to receive. Your financial need is calculated by subtracting your school's Cost of Attendance (COA) from your Expected Family Contribution (EFC). In order for you to receive need-based aid, your COA must be greater than your EFC.

Let's take a look at how Financial Need is calculated.

COA – EFC = Financial Need
Expected Family Contribution

Schools use the processed data from the FAFSA and/or the CSS Profile to determine your financial aid eligibility. Whether you complete the FAFSA and, if required, the Profile, the basis for determining your award is a number referred to as the Expected Family Contribution (EFC).

The EFC is a measure of your family's ability to pay for college based on student and parent income and asset information, your state of residence, household size, and number of household members in college. Some factors that go into determining your EFC include demographic, financial, and household data, among other things.

Cost of Attendance

The next step in calculating your financial need is figuring out what the Cost of Attendance (COA) will be for the school you will attend. The school you attend establishes a COA for the academic period for which you will be enrolled. The COA includes tuition, room and board, fees and estimated living expenses. Variable costs like books and personal expenses are also included.

The Financial Aid Award Letter

The financial aid office at your school will use the need-based resources they have available to try to meet your Financial Need. They will use other funding sources that aren't based on need such as the Unsubsidized Direct Student Loan to help cover the entire COA. Of course, they won't always be able to meet a student's full financing need or cost of attendance. Here's an example of of a financial aid award:

Financial Aid Award Example

In this example, Emily's total Financial Need was $22,800. The school's total offer of financial aid was equal to Emily's need, but her need was met entirely with need-based aid when you consider the Unsubsidized Direct Student Loan she received. Work-study wasn't considered in her net cost because she will have to obtain a job and work in order to receive those funds.

Follow-up Forms

Sometimes, even after a college has received your FAFSA data, additional information may still be required to complete your package/award. This process is called "verification". If you are selected for verification, the school will ask that you fill out a Verification Worksheet. In addition, they request physical copies of documents such as federal income tax returns, W-2′s and any other income statements (e.g. 1099′s) they may require.

Warning: the college will not process your financial aid, without this additional documentation.

If you plan on accepting Direct Student Loans or a Perkins loan, you will also need to complete promissory notes. The college you attend will provide you with specific information on how to complete this part of the process. If it's your first time borrowing a federal loan, you'll also need to complete an "entrance interview," which is simply a session done online or in-person that informs you of your rights and responsibilities as a student loan borrower.

Read everything the college sends you carefully and respond to requests promptly. If you have questions or don’t understand something, call the financial aid office and ask! They’ll be more than happy to provide a helping hand.

Finally, remember you'll have re-apply every year.

Types of Financial Aid

If you aren't familiar with the different types of financial aid that undergraduate students can pursue, we encourage you to do your homework and educate yourself using the links below. Financial aid comes from a variety of sources, so be sure to review each financial aid type in greater detail as you put together your plan.