A Complete Financial Aid Guide for Students

Financial aid programs provide support for students to help meet the costs of obtaining a college education. Funding is provided by the federal and state governments, the individual colleges and universities, and a variety of other public and private sources.

Types of Financial Aid:

(Read :Sources of Financial Aid - to get more information on specific grants and scholarships.) (Also, read: Financial Aid: 5 Common Myths)

Common Categories of Grants and Scholarships :

Questions to Consider:

(Read: our exclusive financial aid FAQs for more detail information.)

Am I eligible for financial aid programs?

The financial aid office at a student's college will determine how much financial aid they are eligible to receive. Eligibility for most federal student aid depends on a variety of factors, including a student's Expected Family Contribution (EFC), year in college, enrollment status, and the cost of attendance at the select college a student will be attending.

Note: EFC is not the amount of money a student's family will have to pay for college nor is it the amount of federal student aid they will receive. EFC is essentially an index number used by colleges to calculate how much financial aid a student is eligible to receive.

Few requirements for a student to receive aid from federal student financial aid (SFA) programs include:

Am I eligible for other education benefits?

There are two educational income tax credits that can reduce you or your family's federal taxes. These are based on your college tuition and fee charges.

1. The Hope Credit, or Hope Education Tax Credit, was established in January of 1998. It can help offset the cost of higher education by reducing the amount of your taxable income. It allows taxpayers who are eligible to receive the credit to claim up to $1,800 per year in approved educational expenses for each student who is enrolled in school.

2. The Lifetime Learning Tax Credit is available for any level of post-secondary study, up to a current maximum of $2,000 per year. Note that only one type of credit (Hope or Lifetime Learning) can be claimed for a student in any given year. For more information about tax credits, students can visit the IRS web site at: www.irs.gov .

When should I start looking for financial aid options?

Plan ahead! It is in your best interest to start the financial aid process in the spring of your junior high school year. Also, equally important is to select and shortlist colleges you want to attend. Few basic questions a student should seek when considering a college/ school for further studies include:

(Suggested read: Road to College; Top 5 Criteria to Select a College; College Application Do's and Don'ts
  • Does the school offer the courses and type of program you want?
  • Do you meet the college admission requirements?
  • Does the school offer a high quality education at a reasonable price?
  • Does the school offer services you need and activities you are interested in?
  • What are job placement rates for students who have recently graduated?
  • What is the school's student loan default rate?
  • How is the school's accreditation?
  • What is the school's refund policy?
  • What is the school's campus security policy?
What financial aid information you need to know from short listed schools/colleges?
  • Find out the counseling procedures for the school's financial aid office. Make it a point to schedule meetings with the financial aid officers there. These officers can help you get a realistic view of how you might be able to afford attending their college/school. Inform them about your family's general financial situation and get an overview of what your chances are of receiving financial assistance.
  • Find out about the financial aid application process--what forms are required; any supplementary materials they want from your family?
  • What is the school's selection criteria for financial aid recipients?
  • What financial assistance is available, including information on all federal, state, local, private, and institutional financial aid programs?
  • What are the procedures and deadlines for individual financial aid program application submission?
  • How does the school determine your financial need, type and amount of assistance in your financial aid package?

NOTE: In the spring of your junior  high school year it is also highly advisable to start researching local sources of scholarships. Although you typically cannot apply for scholarships until the fall of your senior year, you should be  aware and checking with your school counselor for  funding details by organizations, corporations or community groups in your area.

You can also find information about federal, state, institutional, and private student aid in your local library's reference section (usually listed under "student aid" or "financial aid"). Student aid information may also be available from foundations, religious organizations, community organizations, as well as organizations such as the American Medical Association or American Bar Association. Get a copy of a Pre-Application Worksheet for informational purposes. This will help familiarize you and your parents with the kinds of questions you will need to answer .

Who should I contact about various financial aid opportunities?
  • Stay in touch with your counselor and career center specialist beginning in your junior high school year to make sure you find out about all available scholarships in your area. They will also help you obtain the forms for federal and state- aid programs and update you on the same.
  • Visit financial aid officers at your target colleges to find out specific information about financial aid procedures at each college.
  • Attend college fairs and be aware of college representative visits to your high school, they are a good source for information about financial aid programs and procedures.
  • Talk with your parents about their financial status and how it may impact your chances of receiving aid. Ask for your parents' advice and help as you gather financial aid information. Be sure your parents attend any financial aid program events being held at your school.
  • Consider consulting an independent counselor or financial aid advisor. For a fee, these professionals can help you locate sources of funding and help you through the financial aid application process.
How can I find out how much aid I will need to attend a college?

Financial need is the difference between your school's cost of attendance (including living expenses), as calculated by your school, and your Expected Family Contribution (EFC).  Calculating your EFC  can indicate how much money your family will be expected to contribute to the cost of college. This is determined by the Federal Processor from the information you provide on the FAFSA form--but you can estimate your EFC right here on the Internet. 

To get started please involve your parents to add up the total cost of attending each of your target college(s) for one year. You can gain a clear idea of the costs by researching each school through College Research. Many colleges will provide you with information to estimate total annual cost of attending their select institution. 

Add up fixed items such as: tuition, housing, food services, etc. Also, add in the estimated cost of books, clothes, personal expenses, supplies, travel to and from school, and entertainment. Try to be realistic in setting these amounts. Now take the total estimated cost of one year at college and subtract your Expected Family Contribution amount. This gives you a general idea of what your financial aid "need" will be. This "Financial Aid Package" will hopefully consist of a combination of federal and state grants, private or college-based scholarships, grants, and loans.

What are the documents required for financial aid application?

You will need records of income earned in the year prior to when you will start school. You may also need records of your parent's income information if you are a dependent student.

  • You will need records of income earned in the year prior to when you will start school;
  • You may also need records of your parent's income information if you are a dependent student;
  • Social Security Number (can be found on social security card);
  • Driver's license (if any);
  • W-2 forms and other records of money earned;
  • Your and/or spouse's, (if you are married) federal income tax return;
  • Parent's federal income tax return (if you are a dependent student);
  • Untaxed income records - social security, temporary assistance to needy families, welfare, or veterans benefits records;
  • Photocopy of loan agreement(s), if any, with all supporting documents;
  • Bank statement certificate of savings (if any);
  • Business and investment mortgage information, business and farm records, stock, bond, and other investment records;
  • Transcript of grades for the last three years;
  • Photocopy of car(s) registration form for each car owned by family;
  • Alien registration card (if you are not a U.S. citizen);
  • Any additional document that would support the application for financial aid (e.g. medical reports and recent medical/hospital bills, certificate of job termination or end of service, etc...)
How can I reduce the cost of going to college?
  • Consider public over private schools: compare the costs of attending a public college vs. a private institution. Public schools can often offer comparable levels of academic and social possibilities.
  • Plan ahead to reduce the number of years you attend college: while still in high school, taking Advanced Placement courses and taking the accompanying Advanced Placement exams can give you college-level credit. You can also take community college courses to get college-level credit. Look into summer programs offered by community or 4 year colleges in your area. Finally, consider taking summer session courses offered by colleges while you are actually in college! All of these options can help you substantially lessen the amount of tuition you will pay.
  • Spread out the number of years to complete college: if you lessen the number of units or courses you take, you will likely free-up more time to work to help pay your tuition and living expenses. It may take you longer to graduate, but you will be able to spread the cost of attending college over a longer period of time and you will be able to afford it more easily.
  • Attend a community college for the first two years: of your college career. This way you will be able to complete most, if not all of your lower division required courses at a much more affordable cost. Take advantage of this option if finances are really tight for your family and especially if you do not want to go into debt by taking student loans.
  • Develop a reasonable budget while attending college: many students find that they can save substantial amounts of money by simply keeping close track of expenses. Use common sense: buy used books instead of the ridiculously expensive new ones, find the cheapest living accommodations possible, ask college housing offices if there are low cost dormitory options and food service plans, and finally, you may want to consider living at home to save money too.

(View: our financial aid road map for more information.)