There are many ways to pay for college, and it can be confusing to decipher lingo of financial aid. College is a big investment, which is why it’s important to know your options, plan ahead, and choose wisely when paying for it. But in order to do your homework, you have to understand the lingo.
What is financial aid?
Financial aid helps students and their families pay for college. This financial assistance covers educational expenses including tuition and fees, room and board, books and supplies, and transportation. There are several types of financial aid, including grants and scholarships, work study and loans.
The Financial Aid Offices at each campus have professional staff members to administer the aid programs and advise students and their families regarding the financial aid and scholarship opportunities available to them.
Cost of Attendance (COA)
The COA is the average cost to attend for one academic year (fall through spring). It includes tuition and fees, books and supplies, room and board, transportation, and personal expenses. Colleges adjust the COA yearly to reflect changes to these costs, so these numbers may vary.
Expected Family Contribution (EFC)
Your EFC is the minimum amount colleges expect you and your family to pay for a year of college. Your EFC is recalculated yearly based on information from your annual aid application and stays the same regardless of which college you attend.
Your “financial need” is not how much money you think you need for college. It is an official calculation that affects the size of your aid package. To determine your financial need, colleges subtract your EFC from their COA, which in turn determines the amount of financial aid you are eligible for.
Categories of Financial Aid
- Need Based – Colleges award the lion’s share of aid to students with financial need. To be eligible, a student must prove that he or she doesn’t have enough financial resources to pay for college.
- Non Need Based – Colleges award this based on other factors, such as academic achievement.
Types of Financial Aid: Gift Aid vs. Self-Help Aid
- Grants – Awarded based on financial need, reduce your college bill dollar for dollar and do not have to be paid back.
- Scholarships – Given based on academic achievement, such as high test scores, extraordinary or unique talents or accomplishments. Financial need may be an additional factor. >> The credit union offers a scholarship every year to graduating high school seniors. Check our website in January for the application.
- Work Study – A part-time job, usually on campus. Your wages go directly toward your college bill.
- Loans – This is money that is borrowed to help pay college expenses and is usually repaid after graduation.
The Free Application for Federal Student Aid (FAFSA)
FAFSA is the primary application for need-based financial aid. Most colleges will use information from your FAFSA to create your financial aid award. Many families don’t think they are eligible for aid and unfortunately do not file the application.
BIG MISTAKE! Anyone who fills out the FAFSA will at least qualify for a federally insured, low-cost loan—and perhaps other valuable aid such as Pell grants. So, FILL OUT THAT FAFSA!
If you’ve exhausted all your outlets for financial aid and are seeking funds to cover the remanding costs, take advantage of our affordable private student loans!
Visit Tigers Student Choice for more helpful resources to get ready for college.