It’s not easy, but there are some effective, if well-hidden, ways for college students to qualify for financial aid – even in a recessionary environment where credit is tighter than a college quarterback’s spiral.
Whether it’s via lower student loan interest or through beefier grants or scholarships, here’s a road map to some serious student financial aid treasures.
First, know the odds. Most of the financial aid going out to college students is set aside for families that earn less than $50,000 a year. So, ironically enough, if your family makes more than that, college financial aid can be an uphill climb.
That said, even families that earn six figures or higher can get financial help for their college-bound teenager – if you’re tenacious about it. Start with these steps:
Fill out a FAFSA. To maximize your aid possibilities, no matter what your financial income, make sure to complete a FAFSA form. It’s the mothership for financial aid. As the FAFSA Web site states, “The (Free Application for Federal Student Aid), or FAFSA, is the first step in the financial aid process. Use it to apply for federal student financial aid, such as the Pell Grant, student loans and college work-study. In addition, most states and schools use FAFSA information to award their financial aid.” Fill out the FAFSA here. For more information, check out the FAFSA Web site.
Take out a Stafford Loan. Even if you don’t qualify for a scholarship or a grant, your student can still qualify for a low-interest Stafford loan engineered by the U.S. government (Interest rates are capped at 6.8% - but only for undergraduate students). If you take out a Stafford loan between July 1, 2009 and June 30, 2010, the interest is only 5.6% – that’s pretty low by historical standards.
Go for a grant. Federal Pell Grants are now capped at $4,860 per year for the 2009-2010 school year. Grants, unlike loans, don’t have to be paid back. You can also apply for Federal Supplemental Educational Opportunity Grants, which offer between $100 and $4,000 a year, depending on what you’re already getting in financial aid. You can apply for a Pell Grant on the FAFSA Web site.
These aren’t your only options. For example, if you are a single parent, your chances for financial aid might increase. The federal government uses a financial aid formula that accounts for single parents, who Uncle Sam expects to contribute toward their child’s college care costs, no matter what the divorce agreement says. Consequently, single parents may even qualify for more financial aid than married couples.
Also, play up your child’s academic, athletic or other skills by “matching” him or her up with schools that aim for students of your child’s talents. Usually, colleges give out scholarships on their “needs” and not yours. Leverage that by playing the “match” game. Take a short cut by using a scholarship-finding web site like http://www.fastweb.com/.
It’s tough out there financially right now. But there are some creative ways to get your child into college. You just have to know where to look.
—For more ways to save, spend, invest and borrow, visit MainStreet.com.