Financial Aid Basics

More than half of college students receive some sort of assistance to help pay for college. Understanding the various types of financial aid is an essential first step.

Categories of Financial Aid:

  • Need-Based: Students may receive need-based aid when they do not have adequate resources to pay for college and meet specific financial and other eligibility criteria.
  • Non-Need-Based: Non-need-based aid is not based on financial eligibility

Types of Assistance (for both need-based and non-need-based aid, typically with these features):

  • Grants –A gift, no re-payment required
  • Scholarships – A gift, no re-payment required
  • Loans – Must be repaid.
    • Need-based student loans usually do not have to be repaid while you are in school and typically they carry lower interest rates than most other loans.
    • Non-need-based loans also usually do not have to be repaid while you are a student, but unlike need-based student loans, interest will accrue during the time you are in school.
  • Employment – Many schools offer work-study programs or assist students with part-time and summer jobs on or off campus to help earn money to offset expenses.

Sources of Financial Aid:

  • Private: Non-profit groups, corporations, foundations, community organizations, wealthy individuals, religious groups, civic clubs, affinity groups
  • Institutional: College or University (school’s financial aid office)
  • State: State agency
  • Federal: U.S. Department of Education

The following web sites are good sources of additional information: 

  • Student Aid On The Web (U.S. Federal Government)
    • Federal Student Aid for College or Career School – The U.S. Department of Education provides grants, loans, and work-study opportunities to eligible students attending participating colleges or career schools. The Department is the source of nearly 70 percent of all student aid awarded in the U.S. each year. The vast majority of the Department’s aid is not based on academic merit. For further information and an online application, visit the Department’s Web site. 
  • The College Board
  • College Answer (Sallie Mae)
    • Sallie Mae, sponsor of College Answer, is the nation’s leading provider of student loans and administrator of college savings plans. SLM Corporation and its subsidiaries are not sponsored by the U. S. government.
  • National Association of Student Financial Aid Administrators
    • NASFAA is an association of over 3,000 colleges, universities, career schools, and others with an interest in student financial aid. NASFAA does NOT provide financial aid to students. The NASFAA web site contains some of the more helpful financial aid guidance on the Web as well as other valuable programs and resources.

 

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