Choose a college that uses the financial aid form that work's best for your financial situation. There are basically two forms. One is the FAFSA and the other is the College Profile. And they will frequently paint a very different picture of your ability to pay for your child's college education.......depending on your circumstances.
Anyone who wishes to be considered for financial aid must file a FAFSA (Free Application for Federal Student Aid). This form is actually very simple. It can be filed anytime after January 1st of a student's senior year in high school. The easiest way to file this form (no, you do not need to hire a CPA!) is to complete your tax return prior to filing the FAFSA. When you fill out your FAFSA online you simply put in your factual information, and then when it comes time to put in your financial information you are given the option of linking right into your tax return. If you click this button, all of the financial information is filled in for you based on the numbers on your tax return. This makes the FAFSA extremely user friendly, and can easily be completed in less that one hour. Once the form is completed, the information is immediately processed and within a minute or two it states your EFC (Estimated Family Contribution). This is the amount of money that colleges assume you and your child, together, can contribute toward a year of college expenses. You input on the FAFSA the college codes of any college to which your child is applying, and these colleges will each come up with a financial aid package to cover the rest of the expenses. This package will typically consist of loans (sometimes subsidized by the government), work study and, hopefully, grant money (which is another word for scholarship money and does NOT need to be paid back!).
The other financial aid form is the College Profile. This is required by some, but not all, colleges. This form is much more extensive and will require hours, and perhaps outside expertise, to fill out. College who require the College Profile probe much more deeply into your assets and expenses. Other than the annoyance, does it matter whether or not your child's future college requires the College Profile? It totally depends on your situation in life....one or which is whether or not you are divorced. The FAFSA only considers the income of the primary custodial parent...the parent with whom the student spends the most time. It also does not consider the value of the home in which the student resides. The government does not expect you to sell your home in order for your child to attend college. (It does want to know about second homes/vacation homes.) The College Profile, on the other hand, wants to know about everyone's income....both parents, even if they are divorced, and step parents as well. With the sticker price of some colleges now exceeding $60,000 annually, it pays to take a look at these forms in advance, and perhaps encourage your child to apply to colleges that are the most promising for financial aid!
See tomorrow's blog on "Outside Scholarships"
Susan Alaimo
Founder and Director of SAT Smart
www.satsmart.com
