7 Tips When Applying for Student Financial Aid

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With tuition, fees, supplies, and living expenses averaging in the tens of thousands of dollars a year, a college education is an enormous investment. For many students, financial aid can and does help cover these costs. According to College Board, there is more than $185 billion in aid available to students, and most do qualify. Some funds are doled out as gifts based on need or merit, and some are loans that must be repaid.

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To obtain most types of financial aid, you must submit the Free Application for Federal Student Aid (FAFSA). The deadline for submitting the application is the end of June (for 2015, that's June 30). You can complete the form online to be eligible for federal and state grants, loans, and work-study assignments. Even if you think your family's financial situation will disqualify you, submit anyway because many factors besides earnings and assets affect colleges' decisions to award financial aid. Submit the application as early as possible for the best shot at funding.

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The formula used in FAFSA submissions for determining aid eligibility assumes that students should spend 20 percent of her/his own funds on tuition and expenses. Parents also are expected to contribute, but at a much lower percentage. Some experts suggest moving children's assets out of private bank accounts and into 529 college savings accounts to minimize the impact of that money on the financial aid calculation. For parents with a lot of savings (not counting retirement accounts), it might make sense to spend down those funds -- by paying off debt, for example -- in order for the student to qualify for more financial aid. Alternatively, a family could use savings to pay for the first year of college and then reapply for assistance through FAFSA for subsequent years.

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Some schools require their own financial aid forms in addition to FAFSA, and many are due well before the official FAFSA deadline. Apply for aid from all schools you might want to attend. Generally speaking, requests for financial aid will not hurt your chances of acceptance; most public and many private schools adhere to a "need-blind" admissions policy. The schools' financial aid web pages may contain a net price calculator that lets you estimate how much you'll pay out of pocket (after accounting for aid) to attend.

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The FAFSA application contains more than 100 questions, but your answers might not tell the entire story of your financial situation. If you think you have mitigating circumstances, submit a letter of explanation. Don't send the letter with the FAFSA form but do send it directly to the schools you're applying to, and include documentation. For instance, if your family is facing high medical bills or a parent recently lost a job, explain the facts and provide billing or unemployment records. Or, perhaps your family is supporting a relative, which means less money available for college than what shows up on the FAFSA form. A supplemental letter could sway a college to reassess your aid package and offer more funding.

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If the aid package is less than you had hoped for, you have several options. First, you can ask for a FAFSA reassessment if your financial circumstances have changed. Never lie on financial aid forms, but ask to resubmit if there are new and significant increases in your expenses or decreases in your income. Next, ask to speak with a financial aid officer and discuss finding a way for you to attend the school. Most experts advise against negotiating, per se, but say that making a gentle appeal in a courteous and gracious way sometimes can pay off. Explain your situation, emphasize your interest in the school, and ask for reconsideration. One way to make your case, if you're an outstanding candidate and you've already been accepted, is to ask your top-choice school to match a better offer from another college. If your preferred school is impressed with your credentials and promise, it might respond with a better offer. It never hurts to ask.

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Beyond the funds available from federal and state governments and college aid offices, financial assistance also comes in the form of private scholarships. Experts recommend beginning the quest during high school -- certainly no later than junior year. Scholarship search engines, such as Scholarships.com and Fastweb.com, can match you with applications for awards that you might qualify for. College scholarships run the gamut, from those that target niche candidates, such as Hispanic students planning to study a STEM (science, technology, engineering, mathematics) field to those that reward specific achievements, such as poetry writing. Private organizations often underwrite these awards, although some colleges and universities also offer targeted scholarships. Again, ask the schools you're interested in whether such help is available. Scholarship applications often require essays, and they have strict deadlines. Winning one (or two or three) does more than lower college expenses -- it looks good on your resume, so it's worth trying for as many as you can.

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Once you're "on" financial aid, you must remain in good academic standing in order to keep it. Government and university assistance is renewed annually, and colleges generally demand a certain level of academic achievement. Each school has its own policy, so it's important to know the minimum requirements, such as grade point average (GPA) and the pace at which you should be moving toward graduation. Always speak with a financial aid officer before withdrawing from or dropping a class, or if you think you're in danger of failing a class. These scenarios have the potential to jeopardize your financial aid. And remember, you must fill out a Renewal FAFSA every year.