Darnell Henderson | The Crow’s Nest
By Catherine Hicks
In a world where college tuition prices continue to skyrocket, it comes as no surprise that 85 percent of students in a post-secondary school utilize some form of financial aid, as of the 2016-2017 academic year. This has continued to steadily increase in recent years.
Though a majority of students are using financial aid, it remains confusing for students and parents to understand and navigate the financial aid system. And mistakes sometimes have dire consequences.
In order to assist students in clearing the fog surrounding financial aid, The Crow’s Nest has compiled a guide of some of the most important – and confusing – parts of financial aid.
- Free Application for Federal Student Aid (FAFSA) – The FAFSA is the first step in acquiring financial aid for students and must be renewed annually. An intensive process, the application requires IRS tax returns from not only the student, if they have any, but also from the students’ parents if the student is under the age of 25. The FAFSA uses the information provided by the student to calculate the estimated family contribution (EFC).
- Estimated Family Contribution (EFC) – The information provided by the student’s FAFSA is used to determine the student’s EFC. The EFC is ‘a measure of your family’s financial strength,’ according to the FAFSA website and is based on your family’s taxed and untaxed income, assets and any additional financial benefits. Once calculated, the EFC is a number that determines the amount of federal student aid you’re eligible for and is also used to calculate need-based scholarship eligibility.
- Independent or Dependent – When a student under 25 completes their FAFSA, they are asked a series of questions about their parents contribution to their education to determine if they are independent or dependent. For some students, their parents may refuse to provide financial assistance or even withhold information altogether from the FAFSA. In extenuating circumstances such as these, the student is able to petition for an independent status by answering the questions on the FAFSA to say they are independent and then complete the Independency Verification form, which will ask for documentation to verify their circumstances.
- Cost of Attendance – Once a student has been deemed independent or dependent and received their EFC, their university will then calculate a yearly cost of attendance, including full-time tuition, housing, meals, books and supplies, transportation and other miscellaneous expenses. This number is based on where the student will be living – on campus, off campus with parents, or off campus alone. The cost of attendance is how much a school says it costs to attend each year and it is the maximum amount of financial aid a student can receive. Depending on a student’s EFC, they may or may not be entitled to funds covering their entire cost of attendance because it’s expected their family will assist them.
- Deferment – A tuition deferment allows a student to postpone the due date of their bill without cancellation of their classes, housing, or meal plan, usually for six weeks. Students who are receiving financial aid or scholarships are automatically granted a deferment, as long as they meet the requirements which include a completed FAFSA, enrolled at least half-time, and are meeting Satisfactory Academic Progress (SAP) requirements.
- Satisfactory Academic Progress (SAP) Requirements – As required by federal law, all schools that participate in Title IV financial aid programs must have a SAP Policy in place. This policy is calculated using a student’s entire academic record, including dual-enrollment credits from high school. Each semester, a student’s SAP requirements are updated to ensure their GPA doesn’t fall below a 2.0, that they’re on pace for acquiring their degree and that they haven’t utilized their maximum time allotment, which requires a student to get their degree in a specific amount of time. It’s important to check the SAP status each semester, as a student’s SAP can deem them ineligible for financial aid.
Despite its importance, financial aid remains one of the most confusing parts of post-secondary education. According to CNBC, the cost of college increased by more than 25% in the past decade and is only projected to continue to rise.
It’s important that students and parents remain aware of their financial aid status.
One of the easiest ways to do this is to visit Financial Aid under OASIS or call the office each semester to check the status of your financial aid and ensure you’re aware of upcoming deadlines.
