Myth of Financial Aid

College funding is probably the most misunderstood aspect of financial planning overall. Poor planning results in excessive loans that need to be repaid. Many families contribute their hard earned dollars unnecessarily when the college their choice would have been willing to pay for the education out of their endowment fund. These lost dollars could have been used for future retirement plans or vacations, a second home or a first home for the student.

Sources of Financial Aids

Financial aid is money obtained through sources other than your family’s and your own financial resources to help pay for your education beyond high school. There are many kinds of financial aid. Grants, loans, work-study, awards, scholarship, gifts, veteran benefits, and employer-based tuition reimbursement programs are all forms of financial aid. The sources could come from federal and state, individual college, private non-profit organization, and commercial lenders.

When considering financial aid, keep in mind two categories: Need-Based and Merit Based (Talent Based). The need-based financing is determined by the household income and in contrast, the merit-based scholarships are independent of your household financing capabilities.

Watch Out the Deadline!

Establishing early communication with your financial aid administrator is advised for several reasons. You can ask questions, express preferences, and learn about any innovative tuition and aid programs the school may offer. During your campus visit, you may want to ask questions to the financial aid officer to find out more information on how their school gives rewards. By doing so, you also make yourself known to the school. Most importantly, be aware of application deadlines, for state and college-based programs can fall very early in the year.



Can't Afford Expensive School??

Do not make the mistake of limiting yourself to less expensive schools based only on what you think your family can afford. The difference between what your family can contribute towards your higher education and the cost of attendance at a particular school will determine your financial need and, therefore greatly the financial aid package offered to you. Plan to diligently pursue every avenue of financial aid you discover, and dig hard for those resources.