Financial Aid 101

Please note that this transcript was auto-generated. We apologize for any minor errors in spelling or grammar.

[00:00:00] Okay, great. Hello, everybody. Thank you for joining us tonight. My name is Stephanie Wells. I work at MIFA. I've been at MIFA for a little over 23 and a half years, and I work mostly with college relations, but I also do a lot of work helping families and students learning about the financial aid process and really the whole enrollment management process.

I have a couple of colleagues here with me tonight, Andrea Keenan and Jennifer Bento Pinion, who are going to answer the Q& A behind the scenes. So let's get started. So before we even get into the bulk of the presentation, I want to put this, uh, QR code up and I'm going to give it to you a little at the end as well.

But you can scan it to get signed up now for the MIFA emails. Just use your phone with the camera and you'll be sent to the link. But we have this QR code and a couple other places during the presentation. And also, if you are in any of these social media channels, [00:01:00] I think I am on all of them. Actually, um, you can connect with us.

So we're always sharing good information, live events that we have coming up, scholarship alerts, things like that. So definitely connect with us on social media. And a little bit of logistics for tonight. And in addition to recording the seminar and sharing the slides with you, we do have the chat feature disabled.

We won't be answering anybody who's raising their hands or putting anything in the chat. So please type in your questions in the Q& A section. Jennifer and Andrea are going to be answering those throughout the evening. If there's some really popular questions that they want me to answer live, they will just put Pop in and announce the question and we'll stop for questions and I'll stop a couple times throughout to see if they have any questions they want to field my way.

And of course, at the end of the webinar, we'll stay as late as you know, we'll stay on for a little bit and [00:02:00] answer any we'll do Q and a at the end as well. So we'll answer a few questions throughout and then at the end, do some Q and a. So with that, let's get started. So a little bit about MIFA and who we are, for those of you who aren't familiar with MIFA.

MIFA is what we call a quasi state authority here in Massachusetts. So we are self financing, we're an independent authority, self financing. Actually created in 1982 by colleges and universities in Massachusetts. They were looking for a low cost funding mechanism for parents to borrow for college. And from that, MIFA was created.

So we are actually one of the oldest, uh, private or alternative loan lenders in the country. We've been doing this for quite a while. Since then, we've gone on to create college savings plans. Some of you may have even saved in the U plan or the U fund. And we also have great guidance and education.

That's really the bulk of what we do at MIFA, is provide guidance and education. And for students, [00:03:00] families, school counselors, college administrators, you name it. Anybody in the community, we're happy to help them. And of course, everything we do at MIFA is free of charge. So here's what we're going to talk about tonight.

Make sure that you understand the types and sources of financial aid that are out there, how the application process works, try to take some of the mystery away of how colleges make those financial aid offer decisions. Towards the end, we'll start talking about how families pay for college and different options that are available as well as free resources.

Now keep in mind, tonight's program is financial aid one on one, so it's really geared towards parents and students, most of whom are going to be in the students high school senior year. We have lots of seminars throughout the year that will focus on how to fill out the FAFSA, how to fill out the CSS profile, what type of loans are out there, how to compare loan options, understanding financial aid offers.

We have every [00:04:00] topic under the sun throughout the next year for all of you who are sending your kids to school next fall. So tonight we're really going to focus on these topics here. Most of which is talking about what financial aid is and how it works. So, um, that'll be really helpful, especially for those who have high school seniors.

Before we get into that, I do want to sort of lay, get, get a sense of the landscape in financial aid world right now. As all you had to do was turn on the news and you probably heard about all the, the FAFSA debacles last year, the free application for financial student assistance. And that was a rough year with the FAFSA last year.

They rolled, the feds rolled out a new FAFSA, which is, um, through FAFSA simplification. And it was a real bumpy road last year, getting this new form up and running online. So a lot of families had trouble and there was a lot of delays. It was, it was a pretty brutal year. [00:05:00] Um, but with that said, overall, the new financial aid, um, form, the FAFSA form is simpler for most people to fill out quickly and navigate much more easily.

Um, so we're hoping knock on wood that this year will be a lot smoother. We can't imagine it will be much worse than last year. Um, but because of the testing that's being done and, you know, fixes that they're putting in place, it won't be released till December 1st this year. So. Last normally it's released on October 1st, the FAFSA form, but this year they are going to delay it a couple months to hopefully make sure they got it right and then it will be a smooth release.

Last year it wasn't released until I think December 30th, so it should be pretty good and up and running by December 1st. Now just understand that this process we know can be, you know, confusing, um, and there's a lot of details. So don't feel afraid or shy [00:06:00] or worried about asking questions, whether it's be to MIFA, the, especially the colleges and universities and the financial aid offices.

They, they want to answer your questions, so don't be afraid to reach out. Um, do be careful about the Facebook parent groups and, you know, the Conversations with other folks at the soccer fields and things like that. Definitely you want to get, get your friends and families, uh, you know, perspective if they've gone through the process, but there's a lot of misinformation out there.

I've actually talked to a few families today who were in this situation. Um, Telling me things they've heard and most of it wasn't accurate. So I had to help her with understanding how the process was going to work. So just, you know, speak to the professionals, sign up for those MIFA emails. We'll keep you on track with good, solid, free information.

And we're going to share a ton of resources in this presentation. So let's get started, started talking [00:07:00] about the sources of financial aid and where that money comes from. So financial aid in general is. money that's used to pay for college. It's not all free money, although that's the type of financial aid that everybody likes is that free money, the grants and scholarships, we call that gift aid.

And you know, not every family is going to get, you know, a hundred percent of what they need in free money for sure. Um, but that is a way that families can pay. And I'll get into a little bit about. grants and scholarships and how that works in the next couple slides. So there's the free money that comes from lots of different sources.

Then you have federal work study. So federal work study is a part time job that students can get on campus, earn a little bit of money to pay for, you know, supplies, maybe food, pizza money, things like that. And they do actually have to apply for that job. It needs to be awarded to the student on their financial aid offer because it is a federal program.

It's not just your typical [00:08:00] part time job. Some of the benefits, in addition to having a job on campus, is that the income the student earns is not reported on the FAFSA the following year. So one nice little benefit to the work study program. In addition to grants, scholarships, and work study is what we call federal student loans, and I want to, you know, visually underline the word student, because there's lots of loans to pay for college.

What I'm talking about when I say financial aid, as far as loans, I'm really talking about those federal student loans. So the federal direct student loan, and we have a whole slide just on that program alone that we'll talk about, but that is considered financial aid because it Is a way for students to help contribute towards the bill to borrow a little bit or, you know, small amount without needing a co signer and being able to, you know, defer those loans while they're in school.

So we'll talk more about that, but those are the three types of aid. So the free money, the work study and the federal student loans. [00:09:00] A little bit more detail on that federal direct student loan. This is a loan that the student takes out in their own name. They do not need a cosigner. Many of you listening may have your own federal direct student loans that you took out for undergraduate or even graduate school.

Maybe, um, your, your other children have taken out federal direct student loans, but it is a nice way for a student to help contribute towards the bill. You know, to have a little skin in the game, the maximum they can take out. You can see the annual loan limits in the chart. As a freshman is 5, 500. So that might not sound like a lot for, you know, some schools that might cost a lot more than that, but it is a way for a student to have, you know, some of the loans in their name and they can defer payments on these loans.

They can, there are maybe forgiveness programs and different federal benefits that they might get with this loan that they wouldn't get through a. private cosign loan, even a loan through MIFA, for example. [00:10:00] So we do recommend that if your family needs to borrow at all, to start with these Federal Direct Student Loans first.

That should always be your first stop if you do need to borrow. Now, this loan could be partly unsubsidized, partly subsidized. Now, what does that mean? Subsidized means that the portion of that loan is interest free while the student's in school. So, let's use the freshman year loan as an example. Up to 3, 500 of that could be subsidized.

The subsidy is awarded or offered based on the family's financials when they fill up that FAFSA form. So the subsidized portion of it is a need based program. The rest of the loan would be unsubsidized, meaning interest will accrue on that portion of the loan. Now, not every family is going to be eligible for the subsidy of this portion of the loan.

So you may find yourself, if you're not eligible for the subsidy, You might see on a financial aid [00:11:00] offer. The entire 5500 is unsubsidized, meaning interest is going to accrue. Um, and that's okay. You know, the interest rates, although the interest rates did go up this year. So they are fairly high compared to what they usually are.

Um, but it is still, you know, pretty much lower than most. education loans that are out there in the marketplace. So the rate you can see is 6. 53 percent fixed for this current academic year. For those of you who are seniors or are going to have high school seniors, your rate will be determined next May.

They'll set the rate in May, the feds, and it will go into effect every July 1st, the rate updates. So your student could see a loan for each year of college at four different loans at four different interest rates. But once that rate is set for that loan, it's fixed for the life of that loan. Again, no payments are due while the student's in school.

There's going to be lots of repayment options for them to choose from. And, [00:12:00] you know, the payment on this loan, if they took out the maximum amount, It's going to be about 300 a month, so do take that into consideration. We'll talk about this as well. How much your family might be borrowing if they do need to borrow, and just keep in mind if you're co signing loans that the student already has these loans that they need to pay for.

Um, so just keep that in mind as you're coming up with your financial plan. Now, where does this money come from? Whether it's a loan grant or, you know, work study or scholarship, the biggest Um, give her a financial aid is going to be the federal government. So that federal direct student, when we talked about it, it's a big program.

The work study, you may have heard of the federal Pell grant. That's a federal program. You can go on studentaid. gov to find out about all the federal programs that are out there. No tax incentives and things like that. The state of Massachusetts. We have a whole slide of aid, um, [00:13:00] of great new programs that are available in Massachusetts that I'm going to cover.

But the state of Massachusetts for mass residents does offer grants and scholarship. And even no interest loans. Now this is a separate office from MIFA. This isn't MIFA. This is going to be the Office of Student Financial Assistance. So I do have a slide that I'm going to talk about some of these programs, but you can go on their website here to find out more.

So there's a lot of aid that's given out nationwide. Most of it's going to come from the feds, uh, but what we don't hear about as much is all the money that colleges and universities are giving out out of their own endowments and their own budgets. And that sort of gets under, under reported, um, compared to the high cost of college, but colleges do, you know, have funding available depending on the school will depend on how much funds and how much they're able to give out, but they do have funds available as well.

And I'll talk about how they give that out in a second. [00:14:00] So those programs through the federal, state, and college or university, typically you're just applying for financial aid through your normal way and you're being considered for all that aid. In addition to that, you can also apply for scholarships online.

So separate from the financial aid, filling out the FAFSA form. So we have MIFA pathway. org, which is a MIFA program. It's a college and career. Web portal that MIFA created years ago. Um, Andre and Jennifer actually work closely on that program. They're going to help answer questions tonight. We have a great scholarship search on that program on that website as well as fastweb.

com is another good search tool you can take a look at. But also check in with the guidance counselor at the student's high school to see what's available locally. Start locally first, apply for those scholarships at the local level because less students are applying for them. There's more opportunities.

The [00:15:00] amounts might not be as big as maybe a Gates scholarship or Gates Foundation scholarship, but it's well worth the effort to apply for the local scholarships. And then to have the student go on some of these, um, search engines like MeFaPathway. org or FastWeb to continue looking for more scholarships.

Now financial aid is given out in two different ways. One of the ways that financial aid is given out, particularly from colleges and universities and some of the scholarships that we mentioned, scholarship organizations, is based on the student's merit. So their talents and skills. Typically merit based aid is awarded in the recognition of their achievements.

Most of it is going to be based on their academics. Um, we also know, of course, athletic scholarships, student might be, um, have great musical talents and get a scholarship to be in the school's band, um, things like that. But most of the scholarships [00:16:00] given out from colleges and universities in particular is based on their overall admissions application.

If your student or does renewability requirements are the minimum GPA that they need to meet. Is there a specific major that they need to be in to get that scholarship? You want to know what the criteria is for the student to keep that scholarship because they need to understand the ramifications if they do not.

So is the minimum GPA, let's pretend it's a 3. 0 and the student gets a 2. 8. What happens? Do they get to keep the scholarship for another semester, get their grades back up? Is a portion of it taken away? Do they lose the entire thing? Know what the criteria is and make sure the student understands their responsibility, because if they lose that scholarship from the college, which could be a big, a big amount, then how are you going to cover that shortfall?

Um, it is a really important [00:17:00] discussion to have. Now, not every college is going to offer merit based scholarships. Some schools, some of the very elite universities, Ivy League schools, for example, where, you know, 100 percent of their students are probably, you know, meritorious and maybe almost straight A students, thinking, you know, Harvard, MIT, schools like that, they don't offer merit scholarships, but they do offer a lot of need based aid, so even, you know, middle income, upper middle income families might, might be able to get some financial aid as well, um, including, uh, You know, from the need based portion that we'll talk about.

So these, Merit scholarships. Just check on the school's website to see what they offer. If you're a junior or sophomore in high school and you're still searching, you know, ask the colleges at their college fairs, um, what kind of merit scholarships they have available and but make sure that you know what the deadlines are.

Deadlines are really critical in this [00:18:00] process. Um, not just the admissions deadline, but these financial aid deadlines that we're talking about for early action early decision. Some of those deadlines might be coming up as early as November for at least on the admissions side. So make sure you know what those deadlines are.

Then we have need based aid, and most of the financial aid that's given out nationwide is going to be based on financial need. So, your family's financials that are going to be determined based on standardized formulas that are built into those forms you're going to fill out online. We're going to talk about those forms in a second, but the FAFSA form, the CSS profile, this is going to include grants, Loans work study and students do need to be making satisfactory academic progress to maintain need based aid.

So we talked about minimum GPAs and things like that for the merit based aid, but the need based aid does have criteria that the [00:19:00] students need to maintain as well. So they, it is really important that students understand that. SAP, we call it, Satisfactory Academic Progress, because if the student, let's say they start with five classes and they're not doing well in a few, so they drop them.

Now they're down to two classes. Uh, that's not maybe going to be able to meet school's satisfactory academic Academic progress standards because they're not moving towards graduation. I'm just using that as an example. Um, but those are things that students need to need to be aware of. Is there how much they're enrolled?

Cause that can have an impact on their financial aid. All right. So I'm going to talk about the application process next. So talking about those forms and how to apply and what's taken into consideration before I move forward, we're going to make a quick. Q& A stop. Is there anything, Andrea and Jennifer, that you want me to answer live right now, or do you want me to keep going?

There are no outstanding questions at this time. [00:20:00] Okay, great. Very thorough. Thank you. Okay, so I mentioned timelines. Very, very important. You want to check every college the student is applying to for admissions. Make sure you know what the admissions deadline is and what the financial aid deadline is.

Now, we mentioned that the FAFSA is not going to be available until December 1st. So, obviously, colleges aren't going to be expecting you to fill out that FAFSA in October or November, but they might have their own financial aid application that they want you to fill out. So, make sure you know what those deadlines are, particularly if the student's looking at early action.

Early decision, because those deadlines are coming up this month and in November, December is a popular timelines. Regular admissions is typically going to be sometime in February, March, um, but we have a great college application manager that you can use to stay on top of those deadlines and put them all sort of in a spreadsheet format to [00:21:00] make sure, you know, things you'll want to know is what colleges they're applying to, what is the application deadline for admissions?

The application deadline for financial aid, and very important, what financial aid applications does the college want you to fill out? First one, everybody's going to be filling this one out, is the FAFSA form. So the Free Application for Federal Student Aid. And underline free. If anybody asks you to pay to fill out this form, may or may not be a scam, but it's a, it is going to be simpler for you to fill out this form.

So definitely, you know, do it on your own. There's going to be lots of free assistance to help you with this. Shouldn't have to pay anybody to get through the financial aid process. And that includes applying for scholarships. Every school is going to require this. You have to complete the FAFSA every year to be considered for financial aid.

As I mentioned, it will be available on December 1st, usually. Next year, I imagine, it will probably go back to that October 1st opening [00:22:00] deadline. Now, if you are a high school senior or you have a high school senior, you've already started filling out the FAFSA, you want to cancel that application because you're filling out the wrong form.

The form that's available online now is for students who are currently in college for the 24 25 academic year. So, you will be filling out the 25 26 FAFSA, which will not open until December 1st. Now, The contributor is going to be the person whose information appears on the FAFSA, in addition to the student, obviously.

That is going to be the person that provides the most financial support to the student. So I'm going to talk about who the contributors are in a little bit. We'll get into that more. The student is going to fill out their section of the FAFSA. They're going to log in, fill that out, and then they're going to invite their contributors.

So each contributor on the form is going to have their own section. So the student contributor will have [00:23:00] theirs and then the parents. Either one or both of them, depending on the situation we'll go through that, is going to fill out their section. Now the last contributor to fill out their, fill out the FAFSA so that the FAFSA is complete can then submit the FAFSA.

If you start a FAFSA and don't do anything with it, don't touch it for 40 days, so there's no activity at all, it's going to, delete what you started and you're going to have to start over. So there'll be a countdown clock on your FAFSA so that, you know, once you start it, you do want to at least have some activity happening, updates or, you know, filling out your section.

Once you submit the FAFSA, you're good to go. But if, if people start filling it out and don't finish it within 45 days and there's no activity, it will, um, you know, Clear out and start over. Now we have a webinar on understanding the FAFSA that's recorded and on our website so we can help you out [00:24:00] with that.

And we're gonna have a lot, lot of FAFSA programs coming up so I'll tell you about that as well. Now the first thing that you'll want to do when you're filling out the FAFSA is get an FSA ID. If you already have an FSA ID, then great, you don't need a new one. Your FSA ID is basically your login to access the federal financial aid system.

And it's a lifetime ID, so You have your login and then your password. So if you don't have one, you can set up an FSA ID. I would just get it out of the way now before the FAFSA is open. So you because it does take a few days for it to process and you can do that right on this website. It's studentaid.

gov and you do have to have an email address. So each contributor has to have a separate email address. As I mentioned, the student is going to need their own FSA ID, which they'll also use to sign [00:25:00] their federal student loan documents, for example, online. If the student is married and they filed separately taxes from their spouse, then their student's spouse will also need their own FSA ID.

Now, every parent that's going to be listed on the, is going to be listed on the FAFSA based on who's providing the, um, financial support. So if the parents, both parents, um, filed joint taxes jointly, then only one parent actually needs an FSA ID. Okay. So you might be able to get away with just one FSA ID if parents filed jointly on their taxes.

Thanks. If one of the contributors does not have a social security number, they can still fill out this FAFSA form that is one of the new features of the new FAFSA, and they'll have to answer knowledge based [00:26:00] questions and have that pulled from their credit history to get their FSA ID. So everybody needs an FSA ID to fill out the form, even if you don't have a social security number.

So what is reported on this FAFSA? You know, basic general demographic information, student citizenship status, undocumented students may be eligible for mass in state tuition and mass state aid. I'll talk about that towards the end. So, you know, don't, you know, make sure that you know what resources are available to you.

Um, but all U. S. citizens and eligible non citizens can receive federal financial aid as well as, um, state aid here in Massachusetts. The colleges the students applying to will all be listed on the form. You can list up to 20 colleges and by listing those schools, once you submit that FAFSA, all that data will go to all of those colleges.

The parents [00:27:00] information will be on the FAFSA. If the parents are married, whether it's same sex parents or not, both parents information is going to be on that FAFSA. If the parents live together, whether they're married or not, if they live in the same household, both parents information is going to be required on that FAFSA.

If the parents are divorced or separated, it doesn't have to be a legal separation. It could be, you know, parents separated yesterday and one of the parents, you know, has moved out. Um, Then it would be the parent who provides more financial support in the last 12 months and their current spouse if they are remarried.

So if parents are providing equal support, because a lot of times that happens, you're going to use the parent with the greater income and assets. So for those who have filled out a FAFSA in the past, this is a little bit different. It's not part of this requirement [00:28:00] really is about who provides the most financial support.

The number of people in the household, um, will be on there. It will pull from the IRS, but you can update that. The number of children in college is still on the FAFSA, although that's not going to be used for federal financial aid, but a lot of colleges might use that for their own institutional aid. If you have multiple kids in college at the same time, financial information will obviously be put on.

Be. That's going to be in there. Um, the parent and student income is so much easier to get right from the IRS. Now it's almost like an automatic download. You just provide consent right in the FAFSA. There's no IRS data retrieval that you have to worry about, both tax and untaxed income that's on that tax return is going to be reported.

Now, for those who are filling out that 2526 FAFSA, the income that's going to be reported is going to be from 2023. So quick [00:29:00] situation with the You know, having to report income from two years ago is that, you know, maybe your situation's changed since then. You know, I talked to a mom today who has lost her job, but the 23 taxes look like she's employed.

So you'll just need to let colleges know if things have changed from 2023. Parent and student assets are reported on the FAFSA. So Checking savings accounts, any investments, not retirement investments, but just regular investments in any farms or business, um, assets. You do not have to include education savings accounts, uh, or you would include it, but it's included as a parent asset.

So you, um, don't report, you know, 529 for an example as a student asset. You want to report that as whoever the owner is, which is typically going to be the parent. Okay. You are not going to be required to report the equity in your primary residence, [00:30:00] the value of your retirement or life insurance. So that's really important on that FAFSA.

Any child report, child support received is going to be considered an asset and debt is not reported on the FAFSA. So, you know, if you have credit card debt, any student loan debt that's not going to be reported on the FAFSA. So they're really looking at, you know, what do you have for income and assets primarily, you know, there's a lot of other things, but those are the biggest drivers.

So income is going to be the biggest driver. A lot of families are worried about, you know, I have some savings. It's really the income is going to be the biggest piece that's looked at. So in addition to the FAFSA, Many of you may be required to fill out a second financial aid form, and these financial aid forms are going to be used by the college to determine their own institutional aid.

Some colleges, many, especially public colleges, even some [00:31:00] smaller private colleges, they use what's on the FAFSA to determine their own institutional aid as well, so you might not need to fill out two forms. But a big one is going to be the CSS profile. That's through the college board. If the student did the SAT, they can actually use that login to, um, fill out, to fill out their section of the profile.

But it is going to be required by many private colleges, especially those with bigger endowments. They have a lot more money to give out because they want They're going to ask a lot more questions. They want more information, excuse me. So there is a cost to this form. There's 25 to have the information sent to one school and then 16 for each additional school on top of that.

Now, when you're putting in this information, if the parent income is over a hundred thousand, or if the family meets other need, um, you know, means, uh, tested. Um, programs such as free lunch, for [00:32:00] example, other criteria, then they may audit, you may automatically see that fee waived. So there are fee waivers available for, um, you know, families might be on the, um, may have lower income or, um, have other criteria that they're meeting.

Now that should be available today, October 1st. So you can fill that out early. And then if a parent, if a family, parents are divorced or separated, the non custodial parent is always going to be filling out the profile as well. Most colleges are going to request, require both custodial parent and non custodial parent.

Oops. Sorry about that. I just clicked by accident. Um, so they're going to be required to fill out the profile as well. So what will happen is a student in their custodial parent will fill out their profile and then put in the non custodial parent's email address so that they'll get an invitation fill out their own profile form.

It'll be secure. Both [00:33:00] parents do not see the other's profile form. So there's no exchange of information. So it's all very secure in that way in private. Some colleges may request you to fill out their own institutional application that might ask a few questions that the FAFSA doesn't cover. So they might have you do that in lieu of the profile.

So very important to know what financial aid applications do you fill out and what are the deadlines to fill those out. Now after you've submitted these applications, it's all sent to the colleges, the state, and the federal government all electronically. Usually it's a day or two, a few days after you submit it, the student will receive via email an FSS, so a FAFSA submission summary.

That's your indication that the FAFSA was processed. So if you need to make any changes to the FAFSA after you submit it, Once you get this email with that summary, [00:34:00] then you know, okay, it's been processed. I can go make changes if I need to. Colleges may also request additional documentation if they need to verify information for the Fed on behalf of the Feds, then they're going to review the applications to determine your financial aid offer.

Now, the financial aid offers may be sent with your admissions decision, or, you know, only accepted students will get a financial aid offer. Sometimes it might be staggered a week later. Um, it really depends on the school. Um, but just, you know, talk to the colleges, review their websites, just to learn about their timing.

Because it really does depend on the time of year and how the student's applying. Typically colleges who have students applying, especially early decision, really want to make sure you have those financial aid offers in hand, um, on that early, who are on that early cycle. Now I mentioned verification.

This could or could not come up [00:35:00] depending on the family and, you know, what, what, They might need to verify. So sometimes families are verified by or selected by the Department of Education or the college or both, um, to verify certain data points on the FAFSA form. So the college will be the one getting in touch with you, even if it's the feds that want data, uh, verified.

to tell you what they need. And now it might be a tax return, transcript, business statements, account statements, things like that. Uh, but you do have to comply with these requests from the financial aid office. So make sure students are opening their email, looking on the school's portal for any messages, opening up that mail.

You don't want to overlook any of these communications because your financial aid offer, Is not going to be finalized until this verification process is complete now, just you might not even have to go through this, but we do want to let you know that it is something that some families have to go through.

So the financial aid office. [00:36:00] Is a really good, um, group of folks to work with and to ask questions of and to begin communication with. I hear a lot of times from families, especially at this stage of the process. They're just nervous when the, you know, until they get those admissions decisions in, they're worried if they ask about financial aid, it might impact their admissions decision or.

The college might be mad. They're asking a question, so they might give less aid. And that couldn't be further from the truth. Um, the financial aid office is there to try and help you access as much aid as you might be eligible for, you know, based on budget, what budgets will allow. They want to answer your questions.

They want to make sure you understand your financial aid offer. So don't be afraid to be in touch with them. That's what they're there for. That's their job. And they, they know that families have questions. They will be the office that you will be talking to, to understand if you have a private [00:37:00] scholarship, maybe a local scholarship, you're going to have to report those scholarships to the financial aid office.

They'll let you know whether it will impact your financial aid offer or not, because you can't be over awarded above and beyond that cost of attendance. So if you have a very large financial aid offer and you get a Another outside scholarship, you do need to report that and they may need to adjust your financial aid offer to be able to take in those extra scholarships.

If there's changes in your family circumstance, so I mentioned the family I talked to today who the mom has lost her job since 2023. So that's a great example of, you know, the FAFSA is not necessarily showing what today's circumstances are. So you do want to let the FA Financial aid office know of any special circumstances such as job loss, maybe you lost overtime or um, you know, there was a natural disaster.

I mean, right now, geez, we're hearing about what's happening in North Carolina and in [00:38:00] Georgia and Florida and the South. And those folks are going to need some help. You know, they're obviously going through rough, rough situations. So that's going to need to be taken into consideration up here. We live in the Northeast where we have our nor'easters and.

You know, trees. Hopefully, you know, not happening to you, but they, you know, it might fall into the garage and you need a new roof on the garage. Those are, you know, big expenses, special circumstances, medical, um, expenses that aren't reimbursed that you do want to talk to the financial aid office about and understand their process to give them that information.

Set up a Zoom call, call them, send them an email, whatever's going to work for you. And then if you need to appeal your offer, you can do that through the financial aid office as well. Okay, quick stop for questions. Jennifer and Andrea, if you have any, let me know and we can stop right now. Uh, [00:39:00] we have a couple, but we're, we're answering them in the, in the QA.

So I think, yeah, I think we're good. Okay, good. I'll stop again. Okay, thank you. All right. So once you filled out all the forms, How do colleges make that decision on what you're going to get for financial aid? The first thing they're going to do is look at your cost of attendance. So that's really what I like to call the sticker price.

So that's going to be the complete cost for your student to go to school for one year. So that's going to include the build costs. You can see in green tuition and fees. If the student's living on campus, food and housing. If the student is living off campus, the food and housing might be a blue box if they're living on campus, and maybe a smaller green box for a partial meal plan through the college.

It really depends on the student, but additional unbilled expenses, such as books and supplies, transportation. [00:40:00] Things like that, that the student needs to pay for. That is can, that is all part of a cost of attendance budget. So financial aid is based on that full picture. So they'll take that number and then they're going to look at your student aid index or SAIs.

A lot of acronyms in the financial aid world. MIFA has an SAI calculator on our website that you can take a peek at if you have a, you know, a younger student, um, you want to know what your student aid index is. But that is a number that's going to represent your family's financial strength. It's the same federal formulas used for every family.

The income really weighs much more heavily than assets in the formula. Um, some colleges, um, may use a different formula for their own institutional aid and, but it all is based on the family having the primary responsibility to pay the bill. Uh, but colleges. You know, they want to, you know, they help you [00:41:00] with financial aid to make it to make it a little bit easier.

Now your student aid index will be a number you'll see on that FSS, that FAFSA submission summary. That's not necessarily what you're going to pay. Again, it's an index. Um, So if you see that number and it's small and you get excited, like, Oh, geez, that's 1, 500. That's all I'm going to have to pay. Well, colleges, most colleges can't give you a hundred percent of what you might need.

Um, so we'll talk about that in a second. So you might be paying more than your SAI, which is true for most families. So colleges will take that cost of attendance number, subtract the student aid index, and what's left over is what you're eligible for in financial aid. Now this is, there is a thing called a negative SAI, um, student aid index, that's less than zero, so it can be as low as negative 1500.

Really zero is the lowest number [00:42:00] that's considered in financial aid. But, you know, a lot of families might, you know, have, you know, even a lower SAI calculated down to negative 1500. And colleges might use that as, you know, sort of a flag to know that that family has a lot You know, much heavier need. Um, so they might be able to use that, um, as, as a flag to help, help students who have much higher need.

So they're going to try and fill in your financial aid offer with aid from all different resources. So this is an example of how it might look. So we'll look at a college that costs 45, 000. First thing the college is going to put in your financial aid offer is going to be your SAI. So you're always going to have to pay at minimum your student aid index number.

Then they'll put in all the free money that you're eligible for. Whether it's a merit scholarship from the school and a Pell Grant or a combination of both, the free money is going to be in there. So [00:43:00] you can see in this example, we're 500. Then you'll likely see a full 5, 500 for a freshman Federal Direct Student Loan.

So we're filling up, up the bucket here. Then we have a little bit of work study that the student was awarded. So looking pretty good, but they didn't fill up the bucket all the way. So this is what we talk about unmet need. A gap in a financial aid offer is another term that you might hear. So the family does have to pay their SAI of 5, 000.

But the college, you know, couldn't couldn't meet that full financial need of 40, 000, but they did come up with 35, 000. So the family is going to have to cover any unmet need. So just keep that in mind. Now, net price calculators can be a useful tool depending on the school. Every school has one on their website, and it Is a way to [00:44:00] kind of like an S.

A. I. Calculator get an, uh, an example or an estimate of what you might be expected to pay at that particular school. Some schools have more sophisticated, sophisticated net price calculators, excuse me, um, which takes into account merit aids. You might be able to put in your GPAs or test scores in there to see if you might be eligible for merit aid.

So it really is a way for families to start shopping for schools earlier. Families with babies can look at a net price calculator on any college just to start. figuring out, Oh, geez, how much do I need to save at my alma mater? Or, you know, you might have a junior so you can't apply for financial aid yet.

Um, so you might want to know, well, what am I going to be expected to come up with? Those net price calculators can be really, really handy. So let's look at some financial aid offers. Now they're not going to actually look like this. This is just a visual of the numbers that will be on a financial aid offer.[00:45:00]

And all three colleges cost 45, 000. Family has that 5, 000 SAI, and so they're eligible for 40, 000 at each school. So you can see, every school gave some free money in grants and scholarships. Every school gave that student loan, and the work study is the same at each school. But you can see that the grants and scholarships at each school vary pretty drastically.

So, you know, if you look at College A, they met 100 percent of the family's need, which really very rarely happens that families will have 100 percent of their need met, except for at schools, you know, like, like your, you know, bigger schools, um, Ivy League schools, you know, I can mention a couple in Massachusetts, Boston College is an example, but most schools can't meet full need, so they'll do their best to fill up the bucket.

Now you have College B who, you know, did a [00:46:00] little bit better on those scholarships, but there's still 7, 000 in unmet need there, and College C is even bigger. So why is there a variance in aid packages? It could be a number of different things. It could be just a matter of Colleges at BNC have smaller budgets and they just can't afford to give this student as much, or maybe from an admission standpoint, they get a smaller merit scholarship based on GPAs and test scores.

It really depends, um, on the school, but you can see some, you might see some variances, especially in grants and scholarships from the colleges, because that's going to be based on their own budgets. Now, you will notice when you get your financial aid offers coming in the door The totals can vary, and even the way it's displayed and how you get the information can vary.

It could be electronically, it could be in print, by mail, it could be in the student's web portal through the school, it really depends. There is this thing called the College Cost Transparency Initiative that over 600 [00:47:00] colleges have signed on to. To make sure that, you know, they look the same. The same information is in all the financial aid offers.

So there's still a lot of work to be done, but just be aware that the offers might look very different. Now, here you can see very similar three college, same three colleges. Same SAI and cost of attendance, but you can see the unmet need at the bottom is the same from school to school, but you really do want to make sure that you're looking at the line items in those financial aid offers and MIFA will have programs in the spring to help you with this.

To understand is it free money or are they, you know, giving me a huge parent loan of 29, 500 to make it look like a good financial aid offer. And that's the case here. Now there are ways to pay through, you know, parent plus loan might be on there. You can see that here. It's a federal loan, but. Just cross that federal [00:48:00] parent loan off of your financial aid offer, add it to the balance, and then figure out how to pay.

And you might use that, may end up using that federal PLUS loan or get a cheaper loan through MIFA, whoever it might be, if you need to borrow, but just know that the parent PLUS loan is not financial aid. It is a credit based loan that the parent has to apply for. All right, so I'm going to keep going, Jennifer and Andre, unless you want me to stop and then we'll do Q& A.

But let me know if there's anything burning. No, I think we're good. All right. You guys are doing great. All right. So let's talk about how you pay this bill. Hopefully this can help demystify, you know, how do families do this? We get that question all the time. So let's pretend we have an example of a balance due at the end of all the financial aid is.

added in and you're left over with 20, 000 is what you have to come up with for the year. So the first thing you want to look at is past income in the form of [00:49:00] savings, whether it's a 529 plan or just, you know, you know, cash in a checking account or a savings account or CDs, whatever it might be, um, get out those savings bonds and figure out what you can contribute towards savings.

You may decide to put all that you've saved for college into the first year without borrowing. If you have enough to pay for the first year, you may decide to spread it out over four years. So in this example, let's pretend the student worked over the summer. They earned 1, 000 and parents have a 16, 000 529 account.

So they're going to do 4, 000 a year over four years. They want to spread it out a little bit. So 5, 000 in savings, we're chipping away at that balance due. Then we're looking at payment plans. So money out of pocket out of your current wages or salary. Every college has a payment plan, budget plan that's interest free, where you can spread out part or all of what [00:50:00] you owe the school over a period of months.

Typically it might be a 10 month plan, so five months per semester. Um, so in this example, they're going to do five. 5, 000 on the plan at 500 a month on a 10 month payment plan. So by using savings and payment plan, we've chopped our bill in half. They still need to borrow, but you really want to put borrowing is a last resort in any combination strategy.

Other thing I like to do when I'm talking to families, the first thing we'll find out what you owe first. And then my second question is how much can you afford per month? And in this scenario, if the family said, Oh, I can afford 2000 a month. Well, then we can do 10, 2000 a month on a 10 month payment plan and have the balance taken care of.

But in this example, they've said, you know, I can't do it all on a payment plan, but I can afford 600 a month. So that's well over a minimum loan. payment for 20, 000 loan. So let's do 500 a month on [00:51:00] that payment plan. We still have to borrow at 100 a month on a 10, 000 education loan, but at least, you know, the family has cut their borrowing in half by just jumping right to a loan.

Um, you do want to try and use savings and payment plan if you can. So these questions are really important to be talking about now to make sure you're all communicating. Lots of different strategies. Um, these are the conversations you can have on the soccer field about how to talk to the students about, you know, about college.

Maybe do it just once during the week so it's not at the dinner table every night. Um, but you do want to look at what is that bottom line price at each school. Now we know colleges, some cost over 90, 000 right now. That's a huge amount of money, but not everybody is paying that not everybody is going to schools that cost that amount.

So what is the net price for you at each school that the [00:52:00] student has applied to when it comes to the admissions process? Don't rule a school out because of cost. Have the student apply. See what you get in financial aid. If you can't afford it, then you choose a different school. But it's okay to apply to that 90, 000 college because they might be one of those schools that meet full need and you pay the same amount at that school as you would at maybe UMass.

Um, so it is important to not rule the school out because of cost when it comes time to applying, but make sure there are some schools on that list that you know, that you can afford that would make sense financially, like a financially safe school, for example. Sometimes a school student might want to go to community college to start off, and in Massachusetts, I have some great programs that can help with that, but having a balance list is really important.

Um, consider, do you have other kids coming down the line? That, you know, parents need to put through school might even need [00:53:00] to borrow for you don't want to max yourself out on the first kid. If you have a 1 or 2 more coming down the road, especially when it comes in terms of borrowing. You really want to consider the 4 year plan.

Don't, if you're struggling to get through year one, then years two, three, and four are not going to be any easier. Make sure that you can afford it for the full, full four years. Especially if you're borrowing for year one, multiply that monthly payment times four, just as an example to know if I borrow 10, 000 a year over four years, I'm going to pay 400 a month in all, for all of my loans, for example.

Make sure that's an amount you can afford. And does the college have, you know, certain. Programs are services that are really important for your students. Um, you know, learning styles, uh, multicultural centers, whatever it might be, um, if the student has, you know, a disability, whatever it might be, make sure that that is a critical [00:54:00] piece, um, that that school has good support systems for that student, if they have any special needs, sometimes students might need to take a year off and work and try to.

You know, figure out what they want to do, take a gap year that might help the student as well. But these are all things that you should start thinking about and having conversations about because there is a lot of pressure and stress, especially up here in the Northeast, especially here in Massachusetts, um, to, you know, go to a four year school right out.

Of high school and that might not be every student's path and college might not be every student's path. You know, there are a lot of trade schools and great career paths that don't require a college degree. So you do want to, you know, explore whatever options a student is interested in. Now you will get this slide that has a lot of websites on here.

So I'm not going to Go through every one of them. You can look at them on your own. Uh, but Massachusetts has really stepped up its game as far as financial aid and financial aid programs the last couple of years. So get that FAFSA in that [00:55:00] information will be sent to OSFA, the office of student financial assistance to be considered for, um, the, a lot of these programs.

I won't go through all of them, but I do want to point out a couple of them. Mass educate, free community college for mass residents, tuition and frees are covered, and potential for a book allowance. So right there, there's some savings. Going to a public college paying in state tuition is a savings.

Commuting to the private college of the four year school, you can save that way instead of living on campus. There really are lots of ways to do it that can help the family save. Um, Let's see mass grant. Uh, let's see tuition equity law. That's when I wanted to call out is, um, some undocumented students might be able to receive mass state aid and in state tuition rates, even though they might be not eligible for the state aid.

federal programs. Maybe in Massachusetts [00:56:00] they are eligible for these programs. So there are lots of programs available for adults going back to school over the age of 25 mass reconnect. Um, so definitely take a look. You know, that transfer program is a good program. Mass transfer. I did it myself back in the day.

I started out at community college for a year, figure out what I want to do and then went on to a four year school. Um, so definitely, you know, look at all the options. It's not just one way to do it. All right, I'm going to end with some free resources and then open it up for Q& A. So here are a few free resources that can help you through this process.

FAFSA Day Massachusetts, uh, is going to help you with free assistance completing the FAFSA where you log into a Zoom and get put in a private Zoom room with somebody like myself or Andrea or Jennifer that can help you fill out the FAFSA online. You can share your screen and we can do it together. So those events are going to be through [00:57:00] October through February, MIFA is also going to have FSA ID workshops coming up to help you log in and get your FSA ID.

If you need assistance, we will also have FAFSA festivals. So sign up for those MIFA emails. I'll show you that QR code in the next slide. And you'll be put in touch with all of these resources and events that we have coming up to help you. Mass EDCO, if you're looking for in person help, you want to sit down with someone, they have free services filling out the FAFSA at one of their centers.

So you can go on their website to find a center near you. MIFA Pathway, as I mentioned, is our college and career portal and there's some great scholarship searches on there. And some great free resources that you can look at. There's some calculators that you can look at on there as well. That can help you with your search.

So definitely, you know, take a peek at these free resources here. You have your, uh, timeline of [00:58:00] what's going to happen, um, coming up. So right now, most of you are in that. fall senior year bucket that has a lot of the bullets. So it's pretty busy time right now getting in those applications. There's a lot going on.

But just keep an eye on those deadlines and make sure that you're on track. We also have this Um, extended timeline on MIFA. org. That might be a little bit more helpful to see in that format. So here's what can you do now. You can register for MIFA webinars. You can look at this green QR code and you will get these slides so you can click on them if you want.

If you don't have time to do it tonight, uh, but you want to get that FSA ID, research your deadlines and required applications at each school. Take a look at that timeline. I just mentioned that's the orange QR code and sign up for those beef emails. We'll keep you on track. We're not selling your information.

We're not spamming you with. [00:59:00] You know, 10 emails a day. Um, so definitely it's a free resource that will put you in touch with all these other resources and events. I'm talking about based on the age of your child. So here's that QR code again. I'll go back to it in a second and just know that you will have our phone number and email address if you need to get in touch again.

Mifa is a free resource. We're open 9 to 5 Monday through Friday. Email us or call us if you have a financial aid question, you know, obviously we have loans. So when it comes time to pay the bill, we can help with that as well. Um, but definitely be in touch if you have questions. So with that, I am going to put it back on this slide with the QR code in case y'all want to scan it to sign up for the emails and I'll open it up to Jennifer and Andrea to shoot me some questions to answer for the audience.

We actually do not have any [01:00:00] outstanding questions. You guys have gotten all of them covered? We got the most of them. Let's see, there are a couple coming in. Uh, let's see. Oh, this is a good one. It's how much do you recommend student Parents borrow, is there a general formula? We get that one pretty often.

That's a really good question. There's not necessarily, well, let me talk about students first, because that is something that there is a guideline on, on students and borrowing. Um, So you don't want to, the student doesn't want their monthly payments to be more than 10 percent of their projected salary.

That's a guideline to look at. They also don't want it, the total, to be more than their projected annual salary. So those are two guidelines that you can use. Um, but keep in mind the federal direct student loan already has built in caps, so they can't borrow unlimited dollars. As far as parent borrowing, amounts.

That's a whole other [01:01:00] issue because you really want to be looking at your budget and that monthly payment and whether that's even going to be feasible for your family, as well as other students coming down the road. There's a lot more that goes into a parent loan scenario with budgets and mortgages and other students that that's an individual.

Um, question that we can definitely help work through. I know you, we can set up a one on one call and we have webinars that can help you with that as well to understand, you know, that the total cost of those loans as well. It's not just the monthly payment. It's the interest that's going to accrue over that 10 year or 15 year repayment term.

And just knowing, you know, that it can be a pretty big investment depending on the school. Um, so I would guess, I would say the other way I would answer that is. to set your number as a parent and make sure the student is aware of what that number is. Uh, so when you're looking at colleges, um, we find that the student typically wants to go to the college that ends [01:02:00] up costing the most.

It's always how it works out. Um, so, you know, have those honest conversations about what you're willing to do, but keep in mind that students are pretty limited on what they can borrow on their own. So they will need usually co signers to take on additional debt. That's great. Thanks, Steph. And here's, I know we get this often, this question often in the office.

So, um, if the FAFSA is postponed to open in December, One will the colleges consider it for the timeline of application for early action or early decision? Yes. Yes. Yeah. Just based on last year's experience, um, colleges were pushing, pushing. They kept pushing their deadlines out. Um, it's going to depend on the school, though.

So, for example, if you're applying to a school that requires the CSS profile. You're filling up the CSS profile that has all the FAFSA information and more, so they can actually give you an estimate of federal and [01:03:00] state aid early on before you even fill out the FAFSA because they were able to calculate that.

Um, so it really depends on the school whether they'll be pushing that out, but just knowing how things went last year, schools were flexible, um, they might have had priority deadlines or recommended deadlines, so just find out on their website. Um, Knock on wood, I don't anticipate it being bad like last year and going beyond December 1st.

I believe it will open December 1st. Uh, I had a bet going on with my colleague that it opened October 1st and I was wrong. Um, but yeah, definitely schools will be flexible and you can ask for that flexibility. Colleges do not want you to make a decision without a financial aid offer in hand and knowing what you're going to pay.

So that's really important to them. So definitely. Be in touch if you have concerns with the college, but they will definitely be flexible, especially if there's issues with the FAFSA again. That's [01:04:00] great. Great question. Any other good ones or do we, are we good? We're, I think we're good. No open questions.

All right. Awesome. Well, thank you everybody for joining us tonight. Um, I want to thank my co co hosts, uh, for helping out with the Q and A. You guys did a great job and, um, we'll send you the recording. It'll probably go out probably Thursday with a link to the slides as well. So thank you for joining everybody and have a great night.

Thank you. All right. Bye.