Should I apply for financial aid?
Everyone should apply for financial aid, regardless of the family’s wealth
There are three strong reasons why you should complete the federal financial aid form, called the FAFSA (Free Application for Federal Student Aid):
Need-based financial aid consists of grants, student loans, and federal work-study jobs.
- Grants are “free money” that you don’t have to pay back, such as scholarships and awards.
- Student loans (that have to be paid back eventually) carry with them the advantage of low-interest rates that don’t start accruing interest until after the student has graduated.
- Federal work-study, which are on-campus jobs often involving community service or work related to the student’s field of study.
2. To automatically establish a line of credit with the federal government that will allow the family to borrow as much low-interest, unsecured money as it needs to help with all college costs not covered by financial aid. If you don’t get enough financial aid from the college, you can turn to this reliable source of money.
Low interest loans from the government provide some significant benefits:
- You can use them to enable you to re-direct out-of-pocket “college money” to pay off higher-interest debt you might have.
- If you have investments growing at 8% (for example) and can borrow relatively low-interest loans you can use these long-term government loans instead of cashing out your long-term investments to pay for college (and getting hit with capital gains taxes). Using “cheap” government money often makes good financial sense.
Financial Aid Basics
- Financial Aid Home
- Analyzing Your Student Aid Report
- Current topics & admissions and aid
- Do you know what kinds of student loans you have?
- Financial aid advice for college students
- Financial aid advice for parents
- Financial Aid Calculator
- Financial Aid Myths
- Financial Aid Probation
- Financial Aid Statistics
- Financial Aid Video Workshop
- Financial Aid: Should You Apply?
- I am divorced; do I have to enter my former spouse's financial data on the financial aid forms?
- International students & financing college
- Multiple Children In College
- Should I take out a private student loan? SimpleTuition's Monisha Perkash explains.
- The Cost of Attendance, Part II
- What if my parents refuse to pay for college? Can I apply as an independent student?
- What is Self-Help Aid?
- What is Student Financial Aid?
- What is the cost of attendance (COA)?