Financial aid is any money that the government or other organizations give or lend to students to help them afford college. While the process may seem intimidating, it is well worth it in the end. Here we will discuss the basics of financial aid and how to go about applying.
To begin, there are four different types of financial aid. They are:
Scholarships are a type of "gift aid," meaning that they do not have to be paid back. Scholarships are merit-based, meaning they are awarded based on a multitude of things such as; high academic or athletic ability, volunteer work, religion or ethnicity, and many others.
One example of a merit-based scholarship at Ohio University is the OHIO Achievement Scholarship, which is given to students based on high school performance and standardized tests.
Another scholarship example is the OHIO Promise Scholarship, which is awarded to students from a variety of diverse backgrounds and experiences.
Another type of gift aid are grants. Grants are need-based, meaning are given to students who are in need of financial help. Grants are given either from federal, state, private, or institutional funds. The FAFSA (which we will discuss later) must be filled out to be eligible for grants.
The Pell Grant is an example of a federal grant that is given to students based on financial need, school tuition, enrollment status, and whether the student attends school for a full year or not.
Unlike scholarships and grants, loans are money temporarily given to students that will later need to be paid back. Most loan repayments don't go into effect until after graduation; however all loans have interest rates, meaning the amount you pay back will be a bit more than the amount you borrowed in the first place.
It is especially important to be cautious when taking out loans. Make sure to only borrow as much as you need. Loans can be seen as a quality investment as long as you are able to pay them off.
There are two main types of loans: federal and private.
Federal student loans are made by the federal government, which requires filling out the FAFSA.
Private loans are made by lenders such as banks, schools, or state agencies.
Check out this link to learn the many differences between federal and private student loans.
Work-study provides part-time jobs on or off campus to students with financial need. The program typically encourages work related to the student's focus of study. To find out if your school provides work-study programs and how to apply, stop into the financial aid office or look on the school’s website.
Regular employment is typically available for all students, whether they are in need of financial assistance or not.
Now let's talk about your outlet to financial aid: FAFSA (FREE Application for Federal Student Aid).
Who can fill out the FAFSA? Anyone! In fact, if you don't fill out the FAFSA, you could potentially be missing out being eligible for financial aid.
Check out this article, "Myths About Financial Aid" to get a better understanding of the realities of who receives financial aid.
What exactly is the FAFSA? It is a form that is used by the U.S. Department of Education to determine a family's need based on income, assets, and other information which you will provide on the form.
Where do I go to fill out the FAFSA? The fastest way is online via www.fafsa.gov. You can also download the PDF and fill it out on paper or ask a financial aid adviser at school if they have paper copies. Don’t forget, it’s free to fill it out!
When do I need to fill it out by? FAFSA usually becomes available in early January each year. It's important to fill out the form as soon as possible so you don't run the risk on missing out on any aid. Typically schools begin making aid decisions in March, which means FAFSA should be done no later than the second or third week in February.
To get an early estimate of your financial aid, check out the FAFSA4caster.
Federal Student Aid is also a great website that goes into detail about all of the different types of aid available to students and how to begin the application process.
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