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Posts Tagged ‘FAFSA’

How much money can I get from FAFSA at a community college?

Tuesday, August 4th, 2009

Dear Babs,How much does FAFSA give to community college students? Since you have experience, I was hoping you could give me some clues as to what to look out for. Please help me!

-Frank about FAFSA

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Dear Frank,

FAFSA is eligible to students enrolled in any institution of higher education (including community colleges) and working towards a degree or certificate. Thus, you are eligible for FAFSA if you’re attending a community college to get your Associate’s Degree or a certificate, but not if you are just taking some courses without the intention of getting your degree. As to what types of aid, and how much you can receive, it depends on a combination of your program of study, financial need, cost of attendance at your school, and your academic achievements. The maximum Federal Pell Grant you may receive is $5,350. The Academic Competitiveness Grant requires the student to have attended a rigorous program in high school and maintain a 3.0 GPA in their program. They cap-out at $750 for your first year in school and $1300 for subsequent years.

As for loans, you can borrow up to $3,500 in subsidized, low-interest loans for your first year, $4,500 for your second, and $5,500 in subsequent years. You can borrow an additional 2,000 a year in unsubsidized loans. Again, the actual amount awarded, in both loans and grants, depends on your demonstrated financial need. This takes into account savings, personal income, family income, and other assets (like property). It also depends on the total cost of attendance at your school, and whether you meet specific academic criteria.

FAFSA considers you for all eligible awards, so there is no harm in applying. Who knows, you may just get the money you need for school!

Good luck!
-Babs

POSTED BY Dear Babs IN Dear Babs, Financial Aid
08.04.09
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Is there a way around the FAFSA?

Thursday, April 23rd, 2009


Dear Babs,

My daughter is going to SUNY Albany (out of state) in the fall, and I am worried about how to pay her tuition. I filled out the FAFSA, and it said our expected family contribution is way over what I think we can afford. Why are they doing this? Is there a chance we can get around this?

-Falling Short of Expectations

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Dear Falling,

Just so you know, you are definitely not the first to be told that your expected family contribution be more than your personal budget will allow. To make sure you have judged correctly, calculate your financial need to figure out what financial aid you will really need to pay for college. Take into account any scholarships or loans already offered, and estimate what cash you can provide each year up front. Then see how far off your EFC is from your Real FC.

There are a few ways that FAFSA calculates your EFC, and depending on your situation, its formula may work to your detriment.

FAFSA looks at all of your available income and assigns a percentage of this income to your child’s college funds. Available income means any salary, property, savings, or investments that you could divert to your child’s education. Second homes, investment property, and valuable cars all qualify as an asset, but your primary residence does not. Therefore, if you own a vacation home that you clearly do not want to sell, this will count against you. FAFSA does not count money in an IRA, but it does count money in a general savings account, or investment funds (mutual funds, stocks, etc.). So if a large portion of your savings for retirement is in these types of accounts, it will hurt you. FAFSA also does not take into account consumer debt. If you owe a lot of money on your credit cards, FAFSA will not take the money required to pay them off from your total available income. These policies hurt a lot of middle-class families with credit card debt and moderate investments. Although your mutual funds may be non-negotiable to you, to FAFSA, they are fair game.

Unfortunately, there is not a lot you can do about your EFC this year. Unless your financial situation has drastically changed because of a lay-off or losing substantial savings because of the market. If this is the case, contact SUNY Albany’s Financial Aid Department to explain your situation-most schools are setting up procedures to deal with such situations in this economic crisis. For next year, try and pay off your credit cards with cash you have saved in the bank. This will reduce your debt-load, and reduce the income you have available in savings. If you have any savings that you have earmarked for retirement, but that are not in an IRA or other registered retirement account, consider transferring them. Do not hide assets-colleges investigate at least a third of FAFSA claims for fraud, and you can be fined as much as 20,000 dollars.

Good luck!

-Babs

POSTED BY Dear Babs IN Dear Babs, Financial Aid, parents
04.23.09
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