Financing your or your child's college education can put a real crunch in a pocketbook. Planning ahead and aggressively seeking financial aid can help to reduce the hurt. Let's get started!

Advice

Starting early and organizing your financial records will greatly improve your financial aid process. Some scholarships have early deadlines, so you should check with your guidance counselor or online scholarship searches for details. Even while in your junior year in high school, you can begin searching for scholarships and preparing for financial aid application forms.

A key for applying for financial aid is completing a Free Application for Financial Student Aid (FAFSA) form. Click here for additional details on FAFSA.

Types of financial aid

Scholarships and grants are the best type of awards because you do not have to pay them back.
Loans must eventually be paid back based on the stated terms, including the interest rate and when you start paying back.

Types of Scholarships

There are general merit-based scholarships and need-based scholarships that can be used at any accredited college or university.
Individual colleges also have merit-based scholarships (merit could be in academics, sports, or music, for example) as well as financial-need grants that can only be used if you attend that college.
Government grants are available; examples include the Federal Pell Grant and other state grant programs.

Please discover more information on scholarships.

Types of loans

Several federal loan programs exist to help students finance their college education.
Colleges may also provide loans for students with various terms.
Loans can be helpful and may have a subsidized interest rate or delayed payments that start after graduation.
There are also private-sector companies such as banks and financial services companies that provide loans to students.

Please investigate more details about loans.

Parental and student contributions

"Parental and student contributions" to college payments are the parts that hurt.

Typically, a college calculates:

financial need = (tuition + room + board) -

(expected parental contribution + student contribution)

The "sticker price" of (tuition + room + board) is set by each school and is probably somewhere between $8,000 and $15,000 for a public school (assuming in-state tuition) to between $20,000 and $35,000 for a private school. Many schools will meet your financial need with scholarships and/or loans. Princeton University guarantees that it will meet a student's financial need with all grants rather than loans.

Unfortunately, some schools are unable to meet your financial need and you may seek additional loans. In certain cases, you and your family may not be able to pay the "expected family contribution" - they expect you to pay a lot - so you may need to apply for additional loans.

The expected parental contribution is based on the assets and income of the student's parents, while the student contribution is based on the student's assets and income. While it would be unethical to hide assets or income, there are certain strategies you can use for how you can structure your college savings to decrease your overall expected contributions.

Seeking more assistance

Please contact us for additional information on financial planning services.

financial need =	(tuition + room + board) -
	(expected parental contribution + student contribution)