2013-14 Financial Aid NightWelcome Parents and Students!

Tonight’s Presenters are:

•Karla Weber, UW-Madison Financial Aid Office

•Barb Fassbender, Counselor, Waunakee HS

Agenda

•Review of Handouts

•Scholarships

•College Goal Wisconsin

•The Wisconsin Covenant

•Questions

•Financial Aid & College Cost Basics

•Types of Financial Aid Available

•The FAFSA & Application Process

•Questions

Scholarships•Free money!•$900,000+ of awards given to WHS students last year

•Your son/daughter MUST apply for these awards

•Some school awards are drawn directly from the admissions application information

•Other information al sources and sites for scholarships:•Waunakee HS Scholarship Bulletins•Waunakee Scholarship Fund Drive•Parent’s place of employment opportunities•Local Service Organizations, businesses

College Goal WisconsinThis is an opportunity to help students and families complete application for financial aid

Where and When?- Saturday, February 22, 2014 – begins at 2:00 pm

~ Madison College – Truax Campus- Sunday, February 23, 2014 – begins at 2:00 pm

~ DeForest High School

~ Edgewood College – Main Campus, Monroe Street- Wednesday, February 26, 2014 – beings at 6:00 pm

~ All sites are outside of the Madison Area – check handout for listings

If you go, plan to bring completed federal income tax return for 2013, W-2 statements, and other 2013 income and/or benefit information for both parents and students. If parents are unable to attend, students may attend alone and bring this information. Independent students may bring just their own income and asset information.

STUDENTS ARE ELIGIBLE FOR A SCHOLARSHIP DRAWING!

Wisconsin Covenant Scholars Grant

Throughout the state, Wisconsin Covenant students are dedicated to bettering themselves and their communities. They are taking tough classes, volunteering in their neighborhoods, and checking out colleges that will be the right fit for them.

To honor this hard work, all Wisconsin Covenant students who fulfill the pledge will be eligible to receive the Wisconsin Covenant Scholars Grant (WCSG).

Senior Student Responsibilities:• Sign and submit the confirmation form. Parent (s), primary contact ( the

student’s school counselor), and student signatures are all needed.• Provide a record of your service hours.• Two letters of recommendation, if necessary, due to a suspension.• Students/parents mail these completed forms to the Wisconsin Covenant

Office.

Important Dates for the Confirmation Process

November/December: Lists of Covenant students sent to the primary contact.

December 1: Confirmation form will become available online and will be mailed to seniors.

January 1: Confirmation process begins.

April 1: Confirmation/FAFSA deadline.

July 1: Deadline for primary contacts to send list of students that were confirmed, but

did not graduate.

Wisconsin Covenant Scholars Grant

•In order to receive the funds students who signed the Covenant agreement in 8th grade, and their parents, MUST file the FAFSA form, regardless of need

•Downloadable forms and questions may be directed to wisconsincovenant.wi.gov

I have been sent the listing of our current Wisconsin Covenant Scholars who are seniors. If you are unsure if you son/daughter is a Covenant student, please see me afterwards.

Minnesota Wisconsin Reciprocity Agreement for 2014 School Year

Under the new reciprocity agreement, the supplementary payments to Minnesota schools (previously paid by the State of Wisconsin) have been eliminated.

That means Wisconsin residents will have to pay the full in-state tuition to attend school in Minnesota.

Visit the Wisconsin Department of Public Instruction’s website for the required filing form and information at:

http://www.heab.state.wi.us/programs.html#reciprocity

Before we continue, are there any questions?

PAYING FOR HIGHER EDUCATION

2014-2015 Academic Year

Karla WeberFinancial Aid Advisor

Office of Student Financial AidUniversity of Wisconsin – MadisonKarla.weber@finaid.wisc.edu

Tonight’s Discussion

•Financial Aid & College Cost

Basics

•Types of Financial Aid Available

•The FAFSA & Application Process

•Questions

WARNING!!!

Financial Aid Regulations

•Federal and state statues and legislation

•Establish unique eligibility requirements

•Applicable to ALL schools that receive funding

FINANCIAL AID & COLLEGE COST

BASICSNeed Analysis

Cost of Attendance

Expected Family Contribution

Financial Need

Principles of Need Analysis

•Financial aid narrows the gap between what the family can pay and the cost of education

•To extent they are able, parents have the primary responsibility to pay for their dependent children’s education.

•Students have a responsibility to contribute

•Evaluated in current financial situation

•Ability to pay evaluated in an equitable and consistent manner

•Recognize that special circumstances can have major financial implications.

What are the costs?

Tuition and Fees+ Room and Board+ Transportation+ Books and Supplies+ Miscellaneous Living

Expenses= Cost of Attendance

(COA)

** Direct versus Indirect Costs**

2013/14 Estimated Costs of Attendance (approx)

College/University

Living @ Home

On/Off Campus

UW-Madison $16,541 $24,221

UW-Milwaukee $16,454 $22,580

UW-Eau Claire $13,740 $18,980

Madison College $12,988 $17,812

UW Colleges $13,510 $18,590

Edgewood College $33,294

Marquette University

$45,508 $48,178

UM-Twin Cities $25,124

Iowa State $31,470

Northwestern $63,228

Expected Family Contribution (EFC)

•Determined by filing the FREE Application for Federal Student Aid (FAFSA) at www.fafsa.gov (NOT .com!)

•Ways to think about the purpose of the EFC•An index number used to calculate eligibility for aid

•NOT an estimate of “extra” cash available

•NOT what you will pay for school

•Stays the same regardless of college/university

•What WILL you be expected to contribute?•Whatever costs the financial aid is unable to cover

EFC Calculation•A complicated formula established by Congress – sometimes referred to as Federal Methodology

•Uses both parent AND student information (for dependent students)

•Has income and asset protection allowances

•Ranges from 0 to 999,999

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Expected Family Contribution (EFC)

Financial Need

Cost of Attendance (COA)- Expected Family Contribution (EFC)= Financial Need

Need Varies

School #1

School #2

School #3

Cost of Attendance

$39,028 $19,388 $14,285

Less EFC $6,355 $6,355 $6,355

Need $32,673 $13,033 $7,930

TYPES OF FINANCIAL AID

Sources of Aid

Gift Aid Versus Self Help

Three Primary Sources

•US Department of Education•The federal agency that provides funding in the form of grants, work study, and loans.

•State•Higher Educational Aids Board (HEAB) manages aid for Wisconsin

•Administers state scholarships, grants, loans, college savings programs.

•Colleges & Universities•May offer their own scholarships, grant, and loan programs with each setting its own requirements

•Availability eligibility varies WIDELY between schools

Types of Financial Aid

•Grants•Federal – Pell Grant, Supplemental Educational Opportunity Grant (SEOG)

•State – WI Higher Ed Grant, WI Tuition Grant

•Scholarships – Institutional, Community, Business, Organizational

•Work Study/Other Employment

•Loans•Subsidized/Unsubsidized Federal Direct Loans

•Perkins Loan•Parent Loan for Undergraduate Students (PLUS)

•Private/Alternative Loans

Gift Aid - FREE

Self-Help Aid

Federal Pell Grant

•Pell Grant

•Based on EFC range; this current year 0 – 5,081

•Award amount varies based on EFC and enrollment status

•Maximum award for 2013/14 - $5,645

•Lifetime Pell Grant eligibility

•decreased from 18 semesters (900%) to 12 semesters (600%)

State of WI Funding - HEAB

•Wisconsin Higher Education Grant (WHEG) or Wisconsin Tuition Grant (WTG)• UW System, Technical and Tribal Colleges• Independent Colleges & Universities (does NOT include for-profit institutions)

•Academic Excellence Scholarship• Questions/Issues? Nancy.wilkison@wisconsin.gov

•WI Covenant• Questions/Issues? Garth.beyer@wisconsin.gov

•Minnesota-Wisconsin Reciprocity – MUST apply• http://heab.state.wi.gov/reciprocity

•Other various programs – most require add’l application – see website• http://heab.state.wi.us

Scholarships

•Colleges/Universities•Need-based & non-need based: Academic, athletic, music, or other talent

•Alumni Organizations

•Civic/Community Organizations•Churches, PTA, Elks, Kiwanis, cultural leagues, etc

•Private businesses•Wal-mart, Best Buy, Dell, Gates Foundation, etc

•Parents’ and/or students’ employers or labor unions

Employment

•Federal Work Study (FWS)•Must show a specified amount of need

•Part-time employment may be on or off campus (public/private non-profit)

•Receive funds through a regular paycheck

•Earnings do not count against future aid eligibility

•Institutional Work Programs

•Off campus/summer employment

Loans

•Perkins Loan•Priority to students who show “exceptional need” as defined by the school and the amount received varies

•Subsidized – Gov’t. covers interest as long as student is at least ½ time.

•Fixed Interest Rate: 5%

•9 month grace period/10 year standard repayment period

•State Loans

•Institutional Loans•Vary in availability and eligibility depending on college/university

•Private/Alternative Loans

Federal Direct Loans

Regardless of income, EVERY student qualifies if they meet the basic eligibility requirements!

•William D Ford Federal Direct Loan Program (DL)• Subsidized: MUST demonstrate financial need

• Unsubsidized: Not based on need (EVERY student is eligible – no matter what!!)

•EFFECTIVE July 1,2013 for NEW BORROWERS

150% Rule for Subsidized Direct Loans• If a borrower exceeds the total enrollment allowed for their program, they

become ineligible for any additional subsidized loans, AND

• They become responsible for the accruing interest on all previously borrowed subsidized loans from that point forward.

Federal Direct Loans - Benefits

•No credit score or co-signer requirements

•Currently low and fixed interest rate

•In-School Deferment: student must maintain at least ½ time enrollment

•6 month grace period

•Repayment period between 10 & 30 years depending on repayment plan

•Deferment and cancellation provisions available

Direct Loan Amounts

•Annual Loan Limits• Freshmen - $5,500 total ($3,500 max subsidized)

• Sophomore - $6,500 total ($4,500 max subsidized)

• Junior/Seniors - $7,500 ($5,500 max subsidized)

• Grad Student - $20,500 (as of 12/13 no longer have subsidized eligibility)

•Career Maximums•Dependent Undergrads - $31,000 ($23,000 max subsidized)

• Independent Undergrads - $57,500 ($23,000 max subsidized)

•Grad & Law - $138,500

•Med, Vet Med, Pharm, Dentist - $224,000

Direct Loan Interest – NEW!

EFFECTIVE July 1, 2013 – Bipartisan Student Loan Certainty Act of 2013

•ALL federal loan interest rates will be tied to the 10-Year Treasury note with a statutorily defined add-on

•Fixed/Variable Rate – interest rate will adjust each year, but will remain fixed once applied to a specific loan.

•There are interest rate caps•Undergrad Direct Loans 8.25%•Graduate Direct Loans 9.50%•PLUS Loans 10.50%

Student Grade Level Loan Type10-Year

Treasury Note Index

Add-On

2013-2014

Fixed Interest Rate

UndergraduateDirect Subsidized & Unsubsidized

1.81% 2.05% 3.86%

Graduate & Professional Students

Direct Unsubsidized

1.81% 3.60% 5.41%

Parents of Dependent Undergrads AND

Graduate/Professional Students

Parent or Grad PLUS

1.81% 4.60% 6.41%

Direct Loan Interest – NEW!

•All federal loans have an Origination Fee that is charged at the time of disbursement

•Due to Sequestration – any loans disbursed after December 1, 2013•Federal Direct Loans (Subsidized & Unsubsidized)

•1.072%

•Federal PLUS Loans (Parent & Grad)

•4.288%

Direct Loan Fees – NEW!

•National Student Loan Data System

•www.nslds.ed.gov

•Repayment Plans• Standard (10 years, minimum $50/month)

• Graduated (10 years, low payments gradually increase)

• Extended (Up to 25 years, fixed or graduated payments)

• Income Based (Up to 25 years, 15% of discretionary income)

• Pay As You Earn (Up to 20 years, 10% of discretionary income)

•Forgiveness Programs• Teacher

• Public Service

• Nursing

Repayment Basics

Parent Loan for Undergrad Students (PLUS)

•Must pass a basic credit check

•Annual Loan Limit: COA minus other accepted aid

•2013/14 fixed interest rate – 6.41%

•Origination Fee – 4.288%

•60 day grace period – “opt-in” to in-school deferment

•Compare to Private/Alternative Loans

•Additional unsubsidized loan eligibility for undergrads whose parent was denied PLUS:• $4,000 per year for 1st and 2nd year students• $5,000 per year for 3rd and 4th year students

www.studentloans.gov

Borrowing Tips

•Consider ability to make monthly payments when you leave school •Loan repayment calculators available online

•Shop around! Choose any participating lender.

•Compare the differences: Fixed/Variable, co-signer requirements, min/max amounts, deferment and/or forbearance options, fees, repayment period, etc

•Borrow only what you need for direct educational expenses and avoid borrowing for discretionary spending

•ALWAYS check with the Financial Aid Office BEFORE pursuing to make sure all other options have been exhausted

Other Resources•Other Government Related

•AmeriCorps www.americorps.gov

•Veteran’s benefits/tuition waivers

•ROTC scholarships and/or stipends

•Bureau of Indian Affairs Grants

•Dept of Vocational Rehab

(DVR)

•School payment plans – may or may not be available

•Home equity loans

•Life insurance policy loans

•Retirement Plan loans

•529 Education Savings Plans (EdVest) www.edvest.com

THE APPLICATION

PROCESSFAFSA

IRS Data Retrieval

Common Questions/Confusion

Special Circumstances

Comparing Offers

College Scholarship Service/PROFILE

•Used by SOME colleges/universities (mostly private)• The school should notify if required

• Don’t trust the website’s list of participating schools (Ex. Edgewood)

•Collects data beyond what’s required on FAFSA

•Uses institutional methodology and targets their dollars ONLY

• Supports early estimates/admission - became available October 1st

•Application fee is $25, plus $16 for each additional school it needs to be sent to

www.fafsa.GOV

Application Process Overview

•Apply for a PIN – student and one parent•www.pin.ed.gov – can request at any point either prior to or during FAFSA

•Submit:

• the FREE Application for Federal Student Aid (FAFSA) prior to your school’s deadline

•www.fafsa.GOV (not .com!!!!)

•Becomes available January 1st for the upcoming academic year

•Must reapply EVERY year!!!

•Any requested/required documents for Verification to the school(s)

•Any institutional application materials (if required/requested by your school)

•Finalize school admissions

•Make sure to meet ALL required deadlines!

What is the PIN?

•www.pin.ed.gov Personal Identification Number

•Electronically sign the FAFSA, but can also be used to:

• Make corrections to a completed FAFSA

• Sign-in to the National Student Loan Data System

• Sign promissory notes for student/parent loans (Perkins, Federal Direct, PLUS)

•The student and at least one parent (if dependent) must get their own

•The PIN should NEVER be shared

PIN Main Page

FAFSA.gov – Student Sign-In

Documents to Have Ready

•Social Security number (Student and parents)

•Student’s driver’s license number (not required)

•Alien Registration Number if not a U.S. citizen

•Federal tax info or W-2 information, for student and parents• IRS 1040, 1040A, 1040EZ

• Foreign tax return and/or

• Tax return for Puerto Rico, Guam, American Samoa, the U.S. Virgin Islands, the Marshall Islands, the Federal States of Micronesia, or Palau

•Records of untaxed income for student and parents, such as child support received, interest income, and veterans non-education benefits

•Information on cash, savings and checking account balances, investments, business/farm assets if required to include

FAFSA Steps•Student Demographics

•School Selection

•Dependency Status

•Parent Demographics

•Financial Information

•Sign & Submit!

•Confirmation

IRS Data Retrieval Tool

•Request and retrieve income and tax data directly from the IRS

•VOLUNTARY!

•“Should” be available beginning early February

•Can be used:•After at least 2 – 3 weeks of electronic tax filing•After at least 8 – 11 weeks of paper tax filing

•If tool not used or changes made, may request “Tax Return Transcript”

IRS Data Retrieval Tool

3 Possible Responses• You are not eligible to

transfer information• Too soon since taxes

filed – may not be available

• Recommend to try!

Citizenship - Explained

•Only the STUDENT is required to be a U.S. citizen, permanent resident, or eligible non-citizen to receive aid

•Undocumented students are currently ineligible for federal and state aid

•Students with Deferred Action Status are also not eligible for financial aid

•What options do undocumented students have?•Very few…

Parents Explained – NEW!

Beginning with the 14/15 FAFSA - Who is considered a parent?•Two biological or adoptive parents REGARDLESS of marital status OR gender, if those parents live together•Both parents information will be included on the FAFSA

•Divorced or Separated parents•Will use information for whichever is determined to be the custodial parent

•Step-parents

•Widowed parent

•Impact of DOMA?

Divorced/Separated Explained

•Complete FAFSA using the parent with whom the student lived with more in the past 12 months

•Believe it’s equal? Use the parent who provided MORE financial support during the last 12 months or during the most recent year the student actually received support

•If the parent has remarried, the step-parent information MUST be included on the FAFSA•Step-parent income and assets represent significant info about the family’s financial resources and help to form an accurate picture of the family’s financial strength

Assets - Explained

•Investments INCLUDE:•Real estate (but not the home you live in), trust funds, UGMA/UTMA accounts, money markets, mutual funds, stocks, bonds, other securities, installment and land sale contracts, etc

•Qualified educational benefits or education savings accounts – 529 Plans

•Investments DO NOT INCLUDE:•The home you live in, the value of life insurance, retirement plans (401k’s), pension funds, annuities, non-education IRAs, Keogh plans, etc.

•Business and/or investment farm assets are excluded IF:•Related family members own 51% or more of the business

AND• It has less than 100 full-time or equivalent employees

Once FAFSA’s filed…

•Results are sent electronically:•To the selected school(s)•To the student/parent – Student Aid Report (SAR)

•If corrections are necessary, log back in and proceed as instructed

•If FAFSA rejects, student/parent must correct before information will be released

•Student may be required to verify their FAFSA data and will need to submit tax forms, but school(s) will request documentation

•Once student has been admitted, a financial aid package will be prepared

•Contact the school with any special circumstances

Keep a

Copy!

Tax Return Transcript

•Have to request from the IRS•Online www.irs.gov•By phone 1-800-908-9946•Complete and submit IRS Form 4056-T

•Taxes filed electronically will take about 3 – 4 weeks before available, paper taxes take about 6 – 8 weeks

•It is a FREE document and is usually received in about 7 – 10 day from request

•Some schools may still choose to request even if data retrieval used

•Can no longer accept copies of the 1040.

Special Circumstances

•Cannot report on FAFSA initially

•Limited to special and unique family circumstances that must be documented

•Usually adjustments to income due to job loss, high medical/dental expenses, recent divorce, one-time income, etc.

•Adjustments are made by each institution on a case by case basis

•School specific – not transferable

•CANNOT consider everything!

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Costs

Net Cost

The Award Letter

How to Compare Aid Offers

•Start with tuition, fees, room, and board

•Subtract grant and scholarship offers ONLY

•The difference is your “net cost”

•Always compare the NET COST of each school

•Do not subtract work study as a lump sum – students are paid based on number of hours worked

•Do not subtract loans – you’ll eventually be responsible for paying for those

Proceed with Caution!

•NEVER pay a fee to file the FAFSA•Go directly to www.fafsa.gov (NOT .com!!!!)

•Don’t hire someone, contact financial aid office if you need assistance

•College Goal Wisconsin!

•NEVER pay to apply for scholarships•Lots of FREE scholarship searches

•Contact your nearest financial aid office if you have questions regarding the legitimacy of any questionable offer

www.studentaid.ed.gov

Video Resource Links

•Overview of the Financial Aid Process•http://youtu.be/kbJ55UWMEFE

•FAFSA: Apply for Aid•http://youtu.be/c-23SMf5DyQ

•How to Fill Out the FAFSA•http://youtu.be/VRyXfUStHO0

•Types of Aid

•http://youtu.be/Pn4OECMTh5w

•Repayment: What to Expect•http://youtu.be/oJHySMdXjxE

•After the FAFSA: What Happens Next?• http://youtu.be/JQxorQ9s_pY

•Myths about Financial Aid• http://youtu.be/K8JuaYVJ_LE

Net Price Calculators

•Federally mandated

•Based on income information and, sometimes, academic information

•Will provide at least the following information:

•Estimated total cost of attendance: tuition and fees, room and board, books and supplies, other expenses (including personal expenses and transportation)

•Total estimated merit- and need-based grant aid

•Estimated net price (cost of attendance minus grant aid)

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So what now?!

•Involve your student!!!

•Be Proactive/Realistic

•Research costs at different schools

•Look for scholarships

•Make a schedule/timeline

•Pay attention

•And…ASK QUESTIONS!!!!

QUESTIONS???