Financial Aid question

[skimomma]

Dd's college choices got seriously hampered by the pandemic and a drastic change in our family income.  Of her original options, she has settled on one, mostly due to financial constraints, and we are going forward with that plan.  Her choice has a minimum of 75% of her tuition being covered by my employment benefits as I work at the university.  She additionally may qualify for merit aid, if she can EVER take the ACT or SAT.  And she is applying for scholarships that may cover even more on the tuition-side.  All this to say, we have tuition covered.  We originally (pre-income disaster) had not intended to file the FAFSA if she chose this route.  With tuition being mostly covered, we were in a position of being able to cover her living expenses, books, and other costs between her savings and our out-of-pocket contributions.  We are no longer able to do this.  She will either have to get financial aid to cover living expenses or live at home.  She does not want to live at home.  We would also prefer she not.

Since the FAFSA will be based on 2019 tax filings, it will not accurately reflect our current financial situation.  I understand there are additional forms we can submit to show the change in income.  Before we even bother.....  Can students take out loans for living expenses only?  If dd's tuition is fully covered by benefits and/or scholarships, can she still seek financial aid for living expenses only?  Does it matter if she lives in campus housing versus off-campus housing?  We don't want to bother with the FAFSA circus if it is not going to help her.

Edited September 30, 2020 by skimomma

[Lanny]

I have read a number of things in the past few years, and watched a few videos, about families that do not file the FAFSA.  A huge percentage (I forget the number) of the families who do not file the FAFSA form, would, in fact, receive Federal Financial Aid. And, probably more aid from the school?

FAFSA Circus?  I think the "CSS Profile" (which DD had to submit to Carolina and several other schools she applied to) is much more invasive and detailed and time consuming.

Note: The correct Federal Income Tax return, for the FAFSA is I believe the one from 2 years ago. Not the one for 2019.  We need to file a Renewal of the FAFSA for DD for the 2021 to 2022 school year, and I looked this morning, to be sure I have my copy of my 2018 Federal return available.

 

 

[skimomma]

1 hour ago, Lanny said:

I have read a number of things in the past few years, and watched a few videos, about families that do not file the FAFSA.  A huge percentage (I forget the number) of the families who do not file the FAFSA form, would, in fact, receive Federal Financial Aid. And, probably more aid from the school?

FAFSA Circus?  I think the "CSS Profile" (which DD had to submit to Carolina and several other schools she applied to) is much more invasive and detailed and time consuming.

Note: The correct Federal Income Tax return, for the FAFSA is I believe the one from 2 years ago. Not the one for 2019.  We need to file a Renewal of the FAFSA for DD for the 2021 to 2022 school year, and I looked this morning, to be sure I have my copy of my 2018 Federal return available.

 

 

Right.  2018 tax filings.  I mistyped. Although the result is the same.  2018 and 2019 will show about 3 times the income we currently have.  So, when i say "circus," I meant the dealing with whatever additional paperwork and proof we will have to provide to show that our income is now dramatically reduced.  I don't know how onerous this is.  Maybe it's not a big deal?  But whatever the case, if her tuition is fully covered by other means and she cannot receive financial aid for living expenses, there is no point.

[Lori D.]

Federal student loans may be used however the student wishes; however, because it is money that needs to be paid back, it is most advisable to use the loan money for directly-related-to-school costs: 
- tuition & fees
- housing (whether dorm/on campus or off-campus) & related expenses (such as utilities at off-campus housing)
- meals (campus meal plans and other food expenses)
- transportation (car expenses, gas, parking fees, bus, purchase a bicycle & maintenance, flights home, etc.)
- textbooks & supplies (including a computer)

One thing to check on is: does your college allow "stacking" of scholarships? Stacking means the school does NOT reduce the "inside" scholarships and financial aid that *they* offer by the amount of scholarships or grants that a student is bringing in from "outside" sources. 

Many schools do NOT allow stacking so they WILL reduce the amount of scholarships and financial aid that they offers by the amount of those "outside" scholarships--which means overall, NO additional financial aid for you.

It can also mean that the outside scholarships (which are frequently 1-time awards) may ultimately reduce DD's future scholarships from the school as well. If the college removes their offer of a 4-year renewable "inside" freshman scholarship because DD has "outside" 1-time scholarships, that covers her freshman year, for the next 3 years, she will have a financial aid hole that *would* have been covered by the renewable "inside" scholarship that will not be re-offered because now she is not a freshman. 

For changed financials, check out this article from the Federal Student Aid website.

Edited September 30, 2020 by Lori D.

[mom2hunangirls]

The FASFA that is about to open tomorrow, for the 2021-2022 year will be based on the 2019 tax return.

On the FASFA site, they direct you to your school's financial aid office (and this is what each of our schools have told us). You will have to document with them the change in financial situation and they can make a professional judgement from that.  So far, no school has told us exactly what "proof" they will require. But all offices are prepared for a LARGE number of appeals.

[Lori D.]

4 hours ago, Lanny said:

...families that do not file the FAFSA.  A huge percentage (I forget the number) of the families who do not file the FAFSA form, would, in fact, receive Federal Financial Aid. And, probably more aid from the school? ...

Totally agree. Some schools do not widely advertise it, but if you don't apply to FAFSA, you will not be considered for scholarships--regardless of family financials.

I recall that some years back, a regular poster on these boards had a DS who missed out on a scholarship that the school wanted to give him-- but couldn't, because the school's policy was only to award even merit-only scholarships to students who had filled out the FAFSA. The family had not filled out the FAFSA, as their financials would not yield Federal Financial Aid -- but that decision cost them the merit-only scholarship.

Edited September 30, 2020 by Lori D.

[skimomma]

36 minutes ago, Lori D. said:

One thing to check on is: does your college allow "stacking" of scholarships? Stacking means the school does NOT reduce the "inside" scholarships and financial aid that *they* offer by the amount of scholarships or grants that a student is bringing in from "outside" sources. 

Many schools do NOT allow stacking so they WILL reduce the amount of scholarships and financial aid that they offers by the amount of those "outside" scholarships--which means overall, NO additional financial aid for you. It can also mean that the outside scholarships (which are frequently 1-time awards) may ultimately reduce DD's future scholarships from the school as well.

If the college removes their offer of a 4-year renewable "inside" freshman scholarship because DD has "outside" 1-time scholarships, that covers her freshman year, for the next 3 years, she will have a financial aid hole that *would* have been covered by the renewable "inside" scholarship that will not be re-offered because now she is not a freshman. 

For changed financials, check out this article from the Federal Student Aid website.

This is where things get tricky and I may need advice.

I have checked with the school about the 75% tuition reduction.  That is not a scholarship as it is an employee benefit.  They told me this will be applied after scholarships, be it internal or external.  So, if dd got a $5000 scholarship and full tuition is $20,000, the 75% would apply to the full tuition minus the scholarship, or $15,000.  That I can figure out.

The only scholarships dd is applying for are internal to the school, including the automatic merit aid she could get based on test scores.  I know based on her PSAT and practice tests that she would very likely qualify for substantial merit aid but so far has not been able to take the ACT or SAT.  She has until classes start in fall of 2021 to take a test so I am hopeful that will happen.  It sounds like I had better ask if a FAFSA is required in order to actually get that merit aid!

I appreciate the link about changes.  I guess I will know more when the FAFSA is available and we start to fill it out.  It says we should report our income based on the day the application is submitted.  That is going to be WAY lower that the tax documentation will show, be it 2018 or 2019.  Further complicating the issue is that we are business owners and will not get a true sense of our actual 2020 income until April 2021, at the earliest.  I understand that waiting that long to file could result in less aid.  So, I guess we figure it out from there.  The fact is, if they are basing it on our former income, dd would likely not qualify for any financial aid.  This is why I am questioning if it is worth it....assuming she does not have to file in order to get any scholarships.

 

[Lori D.]

39 minutes ago, skimomma said:

...employee benefit... will be applied after scholarships, be it internal or external...
... The only scholarships dd is applying for are internal to the school, including the automatic merit aid she could get based on test scores...
...She has until classes start in fall of 2021 to take a test...
...I guess I will know more when the FAFSA is available and we start to fill it out...
... This is why I am questioning if it is worth it...

re: scholarships & tuition reduction
Sounds pretty straight-forward of how the school applies the tuition reduction. Nice! And with no "outside" scholarships, that will make things easier and less complicated. Yea! 😄

re: taking ACT or SAT
Both are offering more testing dates to accommodate the need for social distancing. I'd strongly recommend getting signed up as soon as possible so you can get a test date. That way if they have to bump your test date, you have the rest of the school year to get rescheduled. Here are webpages to get you started:
- ACT covid-19 & test info and registration pages
- SAT covid-19 & test info and registration pages

re: is it worth it to do FAFSA
Yes.

1. It is not hard to do, even if you have to submit additional financial info to show financial changes. I'm sure they work with business owners all the time -- ask them what the process is for applying NOW in October, since you won't have "true" income figures until April 2021.

2. You may miss out on scholarships if you don't do FAFSA.
You can even miss out on merit scholarships based on test scores and that have nothing to do with family finances -- if the school policy is to award to only students who have filled out a FAFSA (see my previous post).

3. You may actually qualify for Federal Financial Aid.
With the recent changes in your family's finances, your student may end up actually qualifying for Federal Financial Aid (Pell Grant -- FREE money, or a Subsidized Student Loan, rather than an unsubsidized loan. Subsidized loans mean that the gov't pays the interest on the loan while the student is in school, and interest does NOT start accruing for the student until 6 months after the student leaves school, either by graduation or dropping out. Unsubsidized Student Loans are ones in which the moment the student accepts the loan, it begins to accrue interest.

4. Apply now for best shot at the most amount of Federal Financial Aid.
The earlier applicants get more money. Think of it like the Federal Gov't has a "pot of money" that holds only so much. They give the full amount of grants and loans to those students who are first in line. As the money left in the pot dwindles, those later in line (i.e. turning in FAFSA in the spring) only get a portion of what they might be eligible for because there's just not enough money in the pot to hand out full amounts. My guess is that covid-19 has hit everyone hard, and even more people will have financial need and be eligible for Federal Financial Aid -- so those who wait until spring to file FAFSA may get nothing because it's already been "handed out" to the early birds and the "pot" is empty.
 

Edited September 30, 2020 by Lori D.

[skimomma]

29 minutes ago, Lori D. said:

re: scholarships & tuition reduction
Sounds pretty straight-forward of how the school applies the tuition reduction. Nice! And with no "outside" scholarships, that will make things easier and less complicated. Yea! 😄

re: taking ACT or SAT
Both are offering more testing dates to accommodate the need for social distancing. I'd strongly recommend getting signed up as soon as possible so you can get a test date. That way if they have to bump your test date, you have the rest of the school year to get rescheduled. Here are webpages to get you started:
- ACT covid-19 & test info and registration pages
- SAT covid-19 & test info and registration pages

re: is it worth it to do FAFSA
Yes.

1. It is not hard to do, even if you have to submit additional financial info to show financial changes. I'm sure they work with business owners all the time -- ask them what the process is for applying NOW in October, since you won't have "true" income figures until April 2021.

2. You may miss out on scholarships if you don't do FAFSA.
You can even miss out on merit scholarships based on test scores and that have nothing to do with family finances -- if the school policy is to award to only students who have filled out a FAFSA (see my previous post).

3. You may actually qualify for Federal Financial Aid.
With the recent changes in your family's finances, your student may end up actually qualifying for Federal Financial Aid (Pell Grant -- FREE money, or a Subsidized Student Loan, rather than an unsubsidized loan. Subsidized loans mean that the gov't pays the interest on the loan while the student is in school, and interest does NOT start accruing for the student until 6 months after the student leaves school, either by graduation or dropping out. Unsubsidized Student Loans are ones in which the moment the student accepts the loan, it begins to accrue interest.

4. Apply now for best shot at the most amount of Federal Financial Aid.
The earlier applicants get more money. Think of it like the Federal Gov't has a "pot of money" that holds only so much. They give the full amount of grants and loans to those students who are first in line. As the money left in the pot dwindles, those later in line (i.e. turning in FAFSA in the spring) only get a portion of what they might be eligible for because there's just not enough money in the pot to hand out full amounts. My guess is that covid-19 has hit everyone hard, and even more people will have financial need and be eligible for Federal Financial Aid -- so those who wait until spring to file FAFSA may get nothing because it's already been "handed out" to the early birds and the "pot" is empty.
 

Thanks so much!

Dd is registered for the December ACT.  We live in an odd geographically isolated location so we do not have a lot of test location options.  The SAT is only offered in schools during the school day here and they do not allow homeschoolers.  Her ACT has been cancelled multiple times....which is how she got the December date bump.  To get a sooner date or to take the SAT, we would have to travel 4+ hours and two states away.  We would absolutely be willing to do this if not for the expense and Covid risk....especially with the chance the test could be cancelled once we were already there or on the way.  We went back and forth and back and forth on this but since she can test up until start date in fall 2021 and still get the merit aid, we decided to cross our fingers for December but know we can go to more heroic lengths in spring/summer if we have to.  That also gives time to see if she lands one of the internal scholarships that would cancel the merit aid out anyway.  Tricky.  Her school has made admissions test optional and she has already been accepted.  But the merit aid requires test scores.  

This is not at all how we saw our only child's college decision process going.  Like most of the rest of the world.

[Lori D.]

1 hour ago, skimomma said:

...Dd is registered for the December ACT...
...This is not at all how we saw our only child's college decision process going.  Like most of the rest of the world.

Good luck in testing!

And... lots of people on these boards have shared about a child who has had post-high school go very differently than expected -- and that was long before there was any pandemic going on. And quite often it turns out to have been a blessing in disguise. As much as you are able and circumstances permit, choose to flourish where you are planted. 😉  Sounds like that's what your DD is doing -- good for her! 😄 

There are people on these boards who have posted about their children who had unexpected injuries or illnesses, or physical healt/ mental health crises, or a family financial crisis or other catastrophic circumstance, that either knocked the student out of college, or delayed entry to college, or completely cut off the ability to go to college. 😢 

Just so glad for you guys that you all have your health and that DD *can* go to college, even it is not the first choice of school. BEST of luck as you guys finish your last year of homeschooling! Warmest regards, Lori D.

Edited September 30, 2020 by Lori D.

[skimomma]

14 hours ago, Lori D. said:

Just so glad for you guys that you all have your health and that DD *can* go to college, even it is not the first choice of school. BEST of luck as you guys finish your last year of homeschooling! Warmest regards, Lori D.

Absolutely!  While things for sure took a turn, we all know that dd is super lucky to have the options left that she does.  We all have our health, we are well fed and sheltered, and dd still has a great educational opportunity....an opportunity that was up for consideration even during the best of times.  And honestly, the narrowing of options has been a bit of a relief.  This makes things simple.  There is a plan, let us now focus on optimizing that plan.  And my dd will still be close.  I would have never encouraged her to stay close for her parents' sake but I am happy to know that she will be within reach during all of this turmoil.

Now, I just have to be brave and tackle the FAFSA!