Paying for College is a Family Affair

THE SAD FACT is that many students who earn admission to college never go because they do not complete the financial aid process. 

THE GOOD NEWS is that there are lots of ways to pay for college and lots of information and help are available to students who honestly need financial aid assistance!

Worth Noting:
            • The earlier you begin to think about paying for college the better.
            • Money is available to almost every student who attends college.
            • No one gets financial aid by wishing! You need to apply and follow through.
            • Even the most ambitious student will need assistance from the adults in the household in order to complete the financial aid application process.
            • You do not need to pay anyone to help you apply for financial aid! Beware of anyone who offers a service for a fee
            • Often the most expensive colleges have the “deepest pockets” and can help the very neediest students to make college affordable.
In a perfect world, families begin thinking about college finances when their children are still in grade school. But we all know this is NOT a perfect world. So—the time for you to start thinking about paying for college is TODAY!

There is a lot of money available to students with need:

While it is true that college costs increase almost yearly, it is also true that there is more financial aid available than ever before- according to the College Board, more than $199 billion. This money comes from the following sources:
  • US Government programs, which provide more than $146.5 billion a year in grants, loans and work-study assistance.
  • State grant and loan programs.
  • College and university grant, loan and scholarship programs.
  • Scholarships given by foundations, corporations and community organizations.

Sources of Financial Aid:
  • Grants and scholarships: Also called “gift aid,” grants are based on financial need and do not need to be repaid. Scholarships are most-often awarded on the basis of strong academic achievement, a special talent or ability, or personal characteristics.
  • Work-study: This option gives students the opportunity for part-time employment either on campus or off campus at a private, non-profit organization or public agency to help them meet their financial need.
  • Loans: These are offered to students or parents and must be repaid. Loans that are awarded based on financial need are low-interest loans, usually sponsored by the federal government. Interest on these loans is paid by the government for students with the greatest need. Repayment does not begin until 6 months after completion of the college program and may be deferred until a later date under some special circumstances.
Applying for financial aid is time-consuming, but not difficult!
There are many people and resources who can help you find your way through the financial aid process. Your school counselor, your teachers, adults in your community or place of worship may all be available to advise you. At every college you consider, financial aid officers will be eager to help students and families understand and complete the financial aid process. Don’t be afraid to ask for lots and lots of help.

If you are a good student and an active participant in school and community, you may qualify for scholarships offered by corporations, foundations, religious organizations, or community groups. Ask at your school about possibilities. 
In the end, all of the work required to apply for financial aid is well worth the effort! In 2011:
  • College graduates (bachelor’s recipients) earned an average of $56,500.
  • High School graduates earned an average of $35,400.
Over the course of your life and career that difference will make up for the cost of even the most expensive college—many times over!

Income Based Repayment: Everything You Need to Know

Over the past several years, the Obama Administration has worked to improve repayment options available to responsible student loan borrowers. On June 7, 2012, President Obama issued a Presidential Memorandum that will help educate more students about their loan repayment options and streamline the Income Based Repayment (IBR) application process.

Since 2009, former students have been able to enroll in an “Income Based Repayment” (IBR) plan to cap their student loan payments at 15 percent of their current discretionary income if they make their payments on time. Approximately 1.6 million people will be able to cap their monthly student loan payment at 10 percent of their income beginning in 2012 by enrolling in IBR. “Research shows that many families are intimidated by the prospect of taking on significant debt to finance postsecondary education in exchange for an uncertain return, which affects college access for a large number of qualified students. For many families, knowing that there is recourse to income-based repayment if the student does not enter a high-paying career or if the economy is bad can be a welcome reassurance. Income-based repayment frees students to make informed enrollment decisions considering a broad range of options, potentially mitigating the obstacles that many low-income families face in the transition to postsecondary education and the economic disincentives to go into fields that may pay less but matter more to the health of our country,” said NACAC Director of Public Policy and Research, David Hawkins. 
See the answers to the questions below and learn more about Income Based Repayment (IBR) from The White House Blog:
1. What is income-based loan repayment?
2. Who qualifies for IBR?
3. Will my eligibility change if I'm married? What if my spouse also has loans?
4. How will enrolling in IBR affect my monthly payments compared to the standard repayment plan?
5. How will enrolling in IBR affect my payments over the life of the loan compared to the standard repayment plan?
6. Is it possible my payments will be higher under IBR than they would under the standard repayment plan?
7. How do I opt in to IBR?
8. What does today’s Presidential Memorandum mean for IBR?
9. How can I find out more?


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