Top federal student aid programs for undergraduate students
College can be incredibly expensive and to some it seems unaffordable. However there are options to pay for college that won’t break your bank. Federal student aid is one of the best ways to pay for your degree if you are eligible.
You can complete the Free Application for Federal Student Aid (FAFSA) to determine how much federal aid you potentially qualify for in the upcoming school year.
What is the FAFSA?
The FAFSA, The Free Application for Federal Student Aid, is a free online form that students can use to apply for federal grants, work-study, and loans before each year of college. The financial aid limit for each program varies by school, year and more. Financial aid is calculated based on your financial need, so how much aid you may qualify for also varies depending on your financial status and how much the school you’ve applied to considers you need.
Factors that colleges consider when assessing your financial need include:
- Expected family contribution (EFC): This is how much your family is expected to pay for your education on your behalf.
- Your year in school: First-year dependent students will have lower student loan maximums than second- and third-year students.
- Enrollment status: You’ll get less financial aid as a part-time student than a full-time one.
- Cost of attendance: Each school has its own cost of attendance, which comes from tuition, fees, room and board, books, supplies and more.
How can you maximize your financial aid eligibility?
The best thing that you can do is to get started quickly. The FAFSA starts accepting applications on Oct. 1 every year for the following year. Since some need-based aid goes out on a first-come, first-served basis, you could get more aid the sooner you apply.
Also consider your assets. Moving your assets to non reportable asset accounts. If you have any reportable assets, you may want to move them into non reportable asset accounts. For instance, if you have a 529 college savings plan, you could move those funds into a Roth IRA.
What are the different types of federal financial aid?
Grants
A grant is a form of financial aid that doesn’t have to be repaid (unless, for example, you withdraw from school and owe a refund, or you receive a TEACH Grant and don’t complete your service obligation). A variety of federal grants are available, including:
- Pell Grants,
- Federal Supplemental Educational Opportunity Grants (FSEOG),
- Teacher Education Assistance for College and Higher Education (TEACH) Grants, and
- Iraq and Afghanistan Service Grants.
Scholarships
Many nonprofit and private organizations offer scholarships to help students pay for college or career school. This type of free money, which is sometimes based on academic merit, talent, or a particular area of study, can make a real difference in helping you manage your education expenses.
Work-Study Jobs
The Federal Work-Study Program allows you to earn money to pay for school by working part-time. You’ll earn at least the current federal minimum wage. However, you may earn more depending on the type of work you do and the skills required for the position. Your total work-study award depends on when you apply, your level of financial need, and your school’s funding level.
Loans
A loan is money you borrow and must pay back with interest. If you apply for financial aid, you may be offered loans as part of your school’s financial aid offer. When you receive a student loan, you are borrowing money to attend a college or career school. You must repay the loan as well as interest that accrues. It is important to understand your repayment options so you can successfully repay your loan.
Conclusion
Funding your education may seem challenging but it is not an impossible task. It’s always best to try and get ahead of the process as soon as possible. While the FAFSA may not cover all your education costs, there are student grants and scholarships that can also help you pay for your education so you don’t have to take out too much in student loans.