Last Updated: August 28, 2021
Financial Aid for Students
Candidates who wish to pursue their higher education will have to inevitably face the expenses involved in the same. The cost of attendance for courses irrespective of the field the student chooses will be a substantial amount that can even put the student in debt by the time they complete the course. it is due to this factor that candidates often wait for a specific period of time and save enough money before they enroll in programs.
Students will also be keen on applying extensively for financial aid in any form whatsoever to complete their education without running out of finances. It is extremely rare for students to spend their educational fee from an existing source of income and most students will prefer to have their cost of attendance to be covered by some financial aid rather than pay for it themselves. Among the different kinds of financial aid, candidates can receive, students often try to avoid student loans and the like since it requires the students to pay the amount back within a limited period of time.
Difference Between Financial Aid and Scholarships
While both financial aid and scholarships are ways of covering one’s educational expenses without having to fret over earning and saving the money before entering college, they can be considered to be different from one another. Scholarships are essentially the prize won by students due to their academic merit or other achievements which can be used by students to cover their tuition fee. Scholarship amounts are either provided directly to the candidate or are sent to the university as part of their cost of attendance. The amount given for a scholarship can either be a part of the educational expense the candidate will have or can even be enough to cover their monthly expenses. Candidates will not be required to pay the amount they have won as a scholarship back.
Financial aid, on the other hand, can either be need-based or merit-based and the candidate will have to provide the necessary proof while applying for the same. While most financial aid does not require candidates to pay the amount back, aid like student loans only provides candidates a brief window before which they will have to pay the amount back. The kinds of financial aid offered include federal student aid, institutional aid, state aid, student loans, grants, work-study, etc.
Types of Financial Aid
The different kinds of financial aid that students can receive include both private and public sources. While most students prefer and apply extensively for financial aid from public sources, some even have to resort to private sources to get their funds on time. The main sources of financial aid include federal student aid, state student aid, institutional aid, work-study, and student loans.
Out of these options, applying for federal student aid can seem challenging to candidates due to the number of documents they will have to submit and also due to the lengthy procedures involved in the same. Institutional aid is often provided to candidates based on their academic performance and is also often need-based. This is provided to candidates from the time they have enrolled in the college and often does not require applying separately.
The work-study option refers to the part-time jobs that are offered to students from within the campus they are studying in. Most often, the students are paid decently enough for them to manage their educational expenses. Students will also have the option of taking public or private educational loans for their education which is also considered to be part of financial aid. But this amount will have to be paid back by the candidate after they have completed their education.
Applying for Financial Aid
Candidates who wish to receive financial aid will most probably have to fill and submit the FAFSA form. This is the primary requirement for all need-based financial aid due to the accuracy of the procedure used. The FAFSA or Free Application for Federal Student Aid is free of cost as the name suggests and can be filled in by any candidate whether or not they are eligible to receive financial aid. The eligibility requirements for filling the FAFSA are generic and have been listed below-
- Student must be a US citizen or an eligible non-citizen.
- Male candidates between the age of 18-25 must register at Selective Service System.
- Student must have Social Security Number.
- Student must have a high school diploma or equivalent.
- Students must not be found guilty of selling or possessing illegal drugs.
- Student must maintain Satisfactory Academic Progress.
Students will be able to fill the hard copy of the form or create an FSA user name and password on the official website. They will be required to fill in their personal details including federal tax Information and record of untaxed income. They will also have to list out the colleges/universities they plan to apply to.
Federal Student Aid
Federal student aid accounts for the largest percentage of aid received by graduate and professional students. Federal student aid includes grants provided by the federal government along with work-study options. They also offer programs like tax benefits for education, education awards for community service with AmeriCorps, educational and training vouchers, scholarships, and loan repayment options for candidates.
This type of financial aid is need-based and hence requires candidates to do a lot of paperwork where they will have to submit all their financial details. They might sometimes be required to even submit the financial details of their close family to be eligible for aid. Federal student aid, unlike other forms of financial aid, covers expenses for accommodation, books, supplies, cost of attendance, etc. depending on the aid the candidate is eligible for.
Grants by Federal Government
Candidates who wish to receive grants from the federal government will have to submit the FAFSA form. While most of the grants provided by the government do not have to be repaid by the candidate, some grants will have to be repaid eventually. Certain conditions will require the candidate to repay the grant they received which changes from grant to grant.
The grants provided by the federal government are-
- Federal Pell Grants
- Federal Supplemental Educational Opportunity Grants
- Iraq and Afghanistan Service Grants
- Teacher Education Assistance for College and Higher Education Grants
Students who wish to receive financial aid from the government but could not receive federal aid can always apply for aid from the state government. To apply for aid from the state government, candidates will have to contact their state grant agency which can be their department of education, higher education agency, special education agency, or the adult education agency in their particular state.
The application criteria and available grants will differ from state to state and hence candidates need to enquire about the details of aid from their state directly from the department. The application procedure also changes from state to state.
Institutional aid is similar to federal student aid and hence can take the form of grants, work-study, and scholarships. The difference between these two is in the source from where the amount is disbursed. While the institutional aid will be provided by the college or university the candidate is studying in, the federal student aid will be provided by the government.
The aid provided through the institution can either be need-based or merit-based. Sometimes the aid will be a mixture of both these factors. One of the most common requirements for the continued availability of institutional aid is that the candidate will have to maintain a particular GPA throughout the duration of the study.
To receive institutional aid, candidates will have to fill and submit the FAFSA form just as they did for the federal student aid. Candidates might also have to file a CSS Profile which further assesses the financial situation of the candidate.
The federal government and even institutions offer candidates with work-study options that can fund their education. The Federal Work-Study option gives both graduate and undergraduate students the option of doing part-time jobs. This option is available only for candidates who have financial needs.
The jobs provided through the program can be both on-campus and off-campus. The money that the student can earn will be dependent on their financial need and the time they apply for the same. At the very least, candidates will get an amount equal to the federal minimum wage.
Students who are seeking financial assistance will often not go for the option of student loans
. The repaying factor of student loans also makes it uncertain whether this is financial aid or not. But at the end of the day, a candidate that takes a public or private student loan will still be able to complete their education on time. They will also get a brief window before they will have to pay the amount back to the source. While repaying the amount, students will have to pay an additional amount as interest. This interest rate varies from source to source and is found to be the cheapest in public sources.
Federal Student Loans
This is the loan provided by the federal government and contains different types to suit the various needs of students. The loans provided by the government are-
- Direct Subsidized Loans
- Direct Unsubsidized Loans
- Direct PLUS Loans
- Direct Consolidation Loans
Private loans are the least sought-after aid by students due to the high-interest rate and the low year gap between the completion of the course and repayment year. It is usually taken by candidates who have received various small scholarships but still require a small amount to complete their education. A few of the popular private loans available to students are from-
- Sallie Mae
- Education Loan Finance
- College Ave
Other Sources for Financial Aid
Students will be able to find more financial aid-related information by using the reference section of their school or in the public library. They will also be able to find relevant information from online sites which they can do through even normal Google searches. Foundations, religious organizations, community organizations, local businesses, etc. all provide candidates with scholarship and grant options as long as students remain open to all possibilities and keep applying.
They will also be able to receive scholarships by looking within their own community or neighborhood. While looking for aid, candidates should not be keen on finding aid that can cover all their expenses. Though it would be better if one aid can cover it all, this is rarely possible for even the brightest of all students. Applying for multiple financial aids and receiving small amounts from different sources will eventually add up and be more useful to candidates.