Financial Aid

FINANCIAL AID 101
Financial Aid is money that the government and other organizations give you or lend you so you can pay for college. To qualify for Financial Aid, you must apply. Financial aid comes from the federal government (the largest source), state governments, colleges and universities, private organizations (such as companies, clubs and religious organizations), and banks and lending companies.


FOUR MAIN TYPES OF FINANCIAL AID

1. Grants

Grants are called gift aid because they do not have to be paid back. Grants come from federal and state governments and from colleges. Most grants are need-based, which means they are usually given based on your or your family’s financial circumstances.

2. Scholarships

Scholarships are also gift aid. Scholarships come from colleges and private organizations. They may be awarded for academic or athletic ability, interest in a certain subject, or volunteer work, for example. Some scholarships are given based on membership in an ethnic or religious group. Companies may also give scholarships to children of employees.

3. Loans

Borrowing money from a bank, government or lending company is called taking out a loan. A loan must be paid back with an extra charge called interest. The federal government offers low-interest loans to students with financial need. Other lenders charge more interest.

4. Work-Study Programs

The Federal Work-Study Program offers paid part-time jobs to help students pay for part of their college cost.



HOW AND WHEN TO APPLY FOR FINANCIAL AID



You must complete the FAFSA to be considered for financial aid from the federal government, state governments and many colleges. This application is completely free and you may file your FAFSA with your previous year's tax information. There is nothing hurt by applying to see what is possible. In the worst case scenario your family would not qualify for any grants, but still could qualify for loans through the federal government. This works in your favor because the interest percentage for the loans you would get from the government is much lower than the rate from any other institution offering loans. Another reason to take out a loan is to start building good credit. Also, some colleges award merit scholarships and require the FAFSA to be filled out in order to be considered for scholarships. 
 
Before You Apply:
  • Complete your income tax return. When completing your FAFSA, you and your family will be able to use your most recent completed tax returns. You can transfer your income data directly from the IRS website to your FAFSA, making it easier to accurately complete the FAFSA.
  • Create an FSA ID. When you start your FAFSA on the web application, you will set up your account by creating a user ID and password. These will become your online identifiers for all federal student aid programs. You will need to provide your own email address and password. (Parents will create their own account using a different email address and password). Set up your user ID and password before you start your FAFSA.
Oct. 1 is the first day you can file the FAFSA!

Be sure to complete your FAFSA soon after it becomes available on Oct. 1 of Senior Year. Filling out your FAFSA as early as possible can help you get a jump on other financial aid applications (state or institutional aid) that may have early deadlines. It also will give you more information earlier about the financial aid you qualify for and will help you make an informed decision about which college is the best financial fit for you.  It is highly recommended to complete the FAFSA by November 15. 


The other major financial aid form that several hundred usually selective, private colleges use is the CSS. The Profile collects more specific data than the FAFSA and sends it to colleges. Since there is a cost for this service, students should check directly with the college or scholarship foundation to be sure the Profile is required. Families can complete this form early in the senior year.



NET PRICE CALCULATOR

Net price is the real price that a student pays to go to a college. It’s the published price of the college minus the gift aid that the student receives. The net price of a college is often much lower than its published price. Colleges offer a tool on their websites called a net price calculator. This online tool gives an estimate of the actual price you would pay to go to a certain college, based on information you enter about your finances. Your net price will be different for every college, so it’s a good idea to use each college’s net price calculator.

NET PRICE = Cost of Attendance - Gift Aid

Net Price Calculator Tools:


Web tool designed by Federal Student Aid to assist high school juniors, seniors and their families plan for education beyond high school. The student will receive:
      • an estimated Expected Family Contribution (EFC) by entering the information into FAFSA4caster
      • the potential Federal Pell Grant eligibility 
      • reduce the time needed to complete the FAFSA when the student applies as a senior January 1st
      • FREE of charge.

Students and their families are expected to contribute to the cost of college to the extent that they’re able. Use the Expected Family Contribution (EFC) Calculator to:
      • Estimate how much the student’s family will be expected to contribute for the year. After all, you can’t make a realistic plan to cover the student’s share if you don’t have any idea what the student’s share could be.
      • Gain insight into the student’s financial aid eligibility. If you’re unable to contribute the entire cost of college, financial aid is available to bridge the gap. That's how the financial aid system works. The difference between the total cost and the student's EFC is considered the student's financial need and the amount of aid you’re eligible to receive.



DON'T RULE OUT EXPENSIVE COLLEGES

A college with a higher price tag might offer you generous financial aid. It might even be more affordable than colleges that charge lower tuition. So think about net price, not published price, and don’t be afraid to apply to colleges you think you can’t afford. Once you hear from the colleges you’ve applied to, compare your financial aid offers (usually offered in March or April) to see which options are best. You have until May 1 to commit to a college.

Be sure to check out this list of Best Colleges on Financial Aid 



HELPFUL FINANCIAL AID WEBSITES

FinAid

This provides information on federal and private loans and scholarship programs sponsored by the National Association of Student Financial Aid Administrators.
Also referred to as College Zone, ISAC has primary responsibility for student financial aid for Illinois students and their families.