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Helpful Web Sites:

Collegeboard.com The folks who bring you the SAT also offer financial aid information and updated statistics on higher education costs.

FastWeb.com Frequently updated, this site matches students’ personalized profiles with scholarship opportunities across the nation.

Finaid.org This nonprofit site is one of the best, most informative, and most comprehensive guides to financial aid out there today.

Insidehighered.com An online magazine offering up-to-date articles on all aspects of higher education.

Projectonstudentdebt.org A nonprofit site that provides news and resources to increase public understanding of the impact of borrowing on students and families.

Upromise.com One way to open a Section 529 college savings plan for your child is by using this site.

SOLVING THE PUZZLE OF PAYING FOR COLLEGE

By Anne Heinen

It’s no secret: College is expensive and not getting any cheaper. Students bound for higher ed (and their families) need to figure out pronto how to cover costs—which can easily reach six figures for a four-year degree.

Luckily, taking simple steps can help pay the way—more than 70 percent of students receive some form of financial aid in the form of grants, part-time jobs, federal or private loans, and scholarships, according to the U.S. Department of Education. The goal is maximizing monies that you don’t pay back, like savings, grants, scholarships, and work-study jobs, and opting for federal loans while minimizing private loans.

Financial aid officers with decades of experience at Texas colleges and universities encourage all students to at least apply for financial assistance, and to reach out for advice when they encounter obstacles instead of giving up.

“We encourage every student to apply,” said Delisa Falks, Executive Director, Scholarships and Financial Aid at Texas A&M University, College Station. “There are people who will qualify for just a student loan and not grant money, but everyone can be eligible for some type of financial aid.”

Simply by getting a handle on what your costs will be and filling out and submitting the Federal Application for Student Aid (FAFSA) in a timely fashion will position you to tap university and colleges’ financial aid coffers that supplement other sources.

CHECK THE ESTIMATED COST OF ATTENDANCE AT THE SCHOOLS OF YOUR CHOICE

Take this step anytime with cost-calculator tools at schools’ websites or CollegeForAllTexans.com. “Trying to get an idea of costs early, before senior year of high school, is important for managing expectations around cost,” said Anne Walker, Director of the Office of Financial Aid, Rice University, Houston.

FILL OUT THE FAFSA

Skip this step, and there’s no financial aid for you. The Federal Application for Student Aid (FAFSA) is a form (available online) that colleges require to help determine a student’s financial need. Data including family income, veteran status, race, and family size is used to estimate how much a student qualifies for in terms of federal grants, subsidized loans, work/study jobs, and other sources, as well as the size of the “expected family contribution.” That’s the amount the government expects to come out of a family’s pocket for college expenses. You can have your FAFSA results directly sent to schools you’re applying to.

Filling out the FAFSA isn’t as onerous as many expect, and many high schools and colleges offer free assistance for families who hit roadblocks when completing it. The Internal Revenue Service’s Data Retrieval Tool makes it easier by accurately uploading pertinent financial data from previous-year tax returns.

“You click a button, it goes to the IRS and populates the FAFSA,” said Laurie Coulter, Assistant Vice President for Institutional Enrollment and Executive Director of Financial Aid at Austin College, in Sherman. “You don’t have to hunt for tax returns.”

A college’s aid package to a student might be more or less than the FAFSA estimate, depending on the school’s resources and the composition of the admitted pool of students.

COMPLETE THE FAFSA AND COLLEGE APPLICATIONS AS EARLY AS POSSIBLE

Colleges have a limited pot of aid to divvy among admitted students, so strive to turn in applications early. The FAFSA can now be completed as early as Oct. 1 and automatically sent to up to 10 schools of your choice.

“It’s important to make sure to apply early for admissions and financial aid,” said Christopher Murr, Director of Financial Aid and Scholarships at Texas State University, San Marcos. “From a financial aid perspective, it’s pretty critical.” It also gives you leeway to polish essays, give time to people writing letters of recommendation, and round up any extra requirements that weren’t apparent at first, he added.

STUDENTS: CHECK YOUR EMAIL REGULARLY AND MEET DEADLINES

After applications are in, follow-up questions or prompts for missing information are emailed to students. “Students will often not check emails or read all the instructions,” Murr said. “They might need to do counseling or meet certain academic standards to receive funds.”

Coulter noted, “Some schools have very firm dates for financial aid priority applications. Knowing those deadlines is very important.”

Because of privacy laws, schools can’t communicate directly with parents unless the student gives permission. Texas A&M finds there’s a flurry of updating after it sends postcards to students’ homes to remind them to check email for missing parts of applications or financial aid requirements, Falks said.

COUNT ON CREATING HIGHER EDUCATION SAVINGS

Families need to expect to have some skin in the game. “A lot of families are under the mistaken assumption that schools will cover all of their costs,” Murr said. “Financial aid is there to supplement family resources.”

HAVE A FAMILY CONVERSATION ABOUT FINANCING AN EDUCATION

“It’s not a fun conversation, but too many families go in (paying for college) blind versus looking at what they can afford,” Walker said. “If you can’t afford a $50,000 a year school, go ahead and apply but be aware there might not be enough aid to make it a reality.”

The parents and student should discuss what colleges are on the table and look at their costs compared to family resources. “They need to think holistically because there will be incidental costs in addition to living expenses, tuition and fees and books,” Falks said.

TAKE TIME TO LEARN ABOUT MONEY MANAGEMENT BASICS AND TAKING ON LOANS

Knowing the basics can help students recognize what’s reasonable debt to take on for higher education versus too much.

Some schools such as Texas State are encouraging students to attend financial literacy programs so that they “can borrow in a way that helps them be successful in college and beyond,” Murr said.

Students who shy from taking on any debt may miss out entirely on the increased earnings and opportunities associated with a four-year degree. But big student loan debt can be crippling to families and students who don’t understand interest rates, terms of repayment, the total amount they’re borrowing, and how the loans often can’t be discharged, even in bankruptcy and sometimes not even in death—making student loan debt a “major problem,” according to 78 percent of adult Texans surveyed in 2016 by Western Governors University (WGA).

WATCH OUT FOR SCAMS

Don’t trust companies that charge for scholarship searches or FAFSA help. Instead, obtain free assistance at guidance counselor offices, state grant offices, schools’ admissions and financial aid offices, and at legitimate websites (see sidebar, “Title of Sidebar,” page xx).

Unscrupulous, high-pressure lenders prey on families wanting to make college dreams a reality, as do for-profit educational institutions that may not deliver on career prep promises. Watch out, too, for identify theft when sharing personal data.

WHAT ABOUT MERIT AID AND SCHOLARSHIPS?

Merit aid and scholarships are great because they don’t need to be repaid. Some schools require separate applications, essays, and recommendations; others, like Texas State, automatically put your application in for merit aid when you apply.

No matter what, don’t count on these sources to cover everything, and check whether it recurs all four years. “It’s hard for families to understand why their brilliant kids didn’t get merit aid,” Walker said. But there’s no absolute formula except at schools that kick in funds for applicants that hit specific SAT or ACT scores or a class ranking. “You never know what a school is looking for in a particular year and there are a lot of smart, engaging, over-the-top students.”

Competitive scholarships from parents’ employers, fraternal organizations, credit unions, historical societies, and more are awarded every year. Applying strategically and doing your best on as many as you can result in funds that will help.

COMPARE PACKAGES

You’re admitted to a bunch of schools and have the financial aid award letters in hand. Now what? Keep your eye on the bottom-line Cost of Attendance, not the award amounts. A school offering $30,000 off tuition still might leave a student with a bigger bill than an institution offering $15,000 off. Similarly, be aware if a school’s “aid” is mostly in the form of loans instead of grants.

“You need to understand what are they giving you. What is your real net price?” Walker said. “How much does it cost to live off campus, if that needs to be factored in? Any financial aid office will be happy to sit down and help a family analyze award letters to figure out what makes the most sense for them.”

Here’s where applying and hearing back from a school early can pay off: “It gives families and students more time to digest financial aid offers and to not make decisions under duress,” Coulter said.

WHAT IF MY DREAM SCHOOL IS FINANCIALLY OUT OF REACH?

While it’s totally reasonable to try for admission at the school of your dreams, brush away the romantic veil. If a college doesn’t come through with a financial aid package that makes a family’s contribution doable, think twice before taking on extraordinary loans. “Ask what school is the best fit and what can the family afford,” Walker said. “You need to manage expectations up front. You can go for that dream school but remember, your kid is going to be fine no matter where they land. There’s a school in Texas for every student in this state.”

COMMUNITY COLLEGE CAN SERVE AS A STEPPING STONE TO A FOUR-YEAR DEGREE

Many community colleges across Texas offer articulation agreements that enable students to save money with lower tuition and living at home while earning credits that transfer easily to a four-year school.

“The community college mission is so valuable to many of our students in Texas,” Walker said. “It’s a great entry point financially, and many have honors and remedial programs.”

Special programs that connect universities and community colleges for an easy transition include Texas A&M University’s engineering academies at community colleges in Austin, Brownsville, Dallas, Houston and San Antonio. At the community college campuses, students take fundamental classes with community college profs and engineering classes with A&M engineering faculty. After two years, students finish their degrees at Texas A&M in College Station.

Sometimes the community college route isn’t the best choice because a student is more likely to enroll only part-time and not be fully engaged with campus life—factors that contribute to dropping out, according to TG, a non-profit student loan guarantor dedicated to helping students achieve higher education goals. Every situation is unique.

FINANCIAL AID OFFICES ARE YOUR FRIENDS

It might not feel like it when your student doesn’t land a full ride, but financial aid officers are in the business of helping make college a reality by giving away money. “We do this because we love our work and make a difference in families’ lives,” Walker said. Reach out to financial aid offices for clarification and assistance as you navigate paying for college.

If you do nothing else:

  • Check Estimated Costs of Attendance at schools where you’ll apply
  • Complete the FAFSA no matter what
  • Submit the FAFSA and college applications as early as possible

Other helpful hints:

  • Meet deadlines
  • Students: Check your email
  • Learn money management basics
  • Watch out for scams
  • Reach out if you have questions. Guidance counselors and college financial aid offices want to help.

As a family:

  • Discuss the family’s financial limits
  • Plan to help cover college costs
  • Compare award letters from schools where you’re admitted in terms of total costs of attendance and award amounts that aren’t loans.