Students across the nation have completed the college application process, successfully submitted their FAFSA, and are now in a holding pattern as they wait to see what the financial aid package will be from the schools that they intently hope to attend this coming fall semester. If you fall into this category of student, rest easy in knowing that you are not the only one. Also, use this “free-time” to equip yourself with the proper tools and information that will allow you to look over your financial aid packages with a fine tooth comb so that you know exactly what your schools are bringing to the table in the form of real financial aid dollars.
The first thing you need to know is that every financial aid package that you receive is going to be different but alike all at the same time. I know.. that makes absolutely no sense right? Let me explain… Each of your financial aid packages are the same to the extent that they all can include the following components and nothing more – Free Money, Work Study Money, and Loan Money (I will talk in detail about each of these later in this article). Your financial aid packages are all going to be different in the sense that each college and university likes to use its own naming system for their awards and prizes that they put on the dollars you receive in your financial aid package. Usually the names have a prestigious ring to them, are related to a specific donor, or have a name that represents a certain department or area of study. However, at the end of the day, all these names and titles that appear on your financial aid award are nothing more than marketing and warm fuzzies so that you, as a student, can feel accomplished in receiving them (which you should!).
Let’s get back to the common components of your financial aid package:
- FREE MONEY: This is money that you don’t have to repay back to anyone. It usually comes in the form of grants, scholarships, awards, etc… Some of this can be need-based monies (you receive as a result of your FAFSA) and some can be merit-based monies (you receive because of all the great things your student has accomplished up to this point). Typically, FAFSA based monies carries the grant moniker but if you can’t tell the difference, drop a call to the financial aid office to get clarification.
- WORK STUDY MONEY: Most students will hold a job while they are on campus. Studies show that students who work between 12-15 hours a week while attending school seem to do better in the classroom. It has something to do with adding structure and organization to their life. However, students working much more than this will probably find it difficult to fully succeed in the classroom. It is simply just a result of having too much to do and not enough time in which to do it. Anyway…. Work Study Money is not guaranteed. The University and College will make every attempt to provide a student with a job but at the end of the day, it is up to the student to secure that job, work the hours required, and then finally get paid. The Work Award component of your financial aid package is a maximum amount that you are allowed to earn through the work study program. So, if you see one school with a low work award component and another one with a high work award, don’t treat this as you would FREE MONEY (above) because it is not the same. I would question the higher work award that is being offered because the chances of you actually working enough hours to fulfill that opportunity could be very slim. Especially, if you plan on having a life outside of the classroom and your work study job.
- LOAN MONEY: Most schools package student loans into the financial aid awards. They usually come in the form of Stafford loans, Perkins Loans, and University loans. These loans are typically just for the student and don’t require a parent or co-signer to be involved. However, from time-to-time, some schools will put Parent PLUS loans and Private Educational Loans in their financial aid award. If you see these types of loans in one aid package and not in another, don’t worry… These loan programs are available at every college and university regardless of whether they pre-package them in your financial aid award or not.
As you receive these financial aid packages, you will want to make sure that you are comparing apples to apples and not apples to oranges. So, what you want to do is make a copy of every financial aid award that you receive. The reason for doing this is so that you can place the original on the fridge for all to see and be proud of. Also, because you are going to get your favorite black sharpie and mark the heck out of the copy that you just made.
I will explain more in part 2 of this article tomorrow. So, stay tuned!