How Harvard Spends Student Tuition – Infographic
This is a fascinating infographic.
The most fascinating piece of the entire graphic is that 77% of students received financial assistance to attend Harvard and that the average tuition for these students was $11,500. That is pretty cheap compare to the vast majority of other schools in the United States, and certainly compared to the majority of Ivy Leaguye Schools.
How does Harvard accomplish this?
Look at the size of their endowment? As one of the oldest and most prestigious universities in our country, they have a rather large endowment, and their alumni strive to keep it that way. Money flows back into money, and the cycle continues.
This is also very encouraging for you as a student or as a parent of a student. Colleges even as expensive and prestigious as Harvard have relatively low costs of attendance. These colleges are attainable.
Don’t kill your dreams (if that is indeed one) of attending Harvard or any other Ivy League School just yet. They might be much more within your reach, financially, than you ever thought possible.
Would you want to attend Harvard for $11,500 per year?
Anything else in this infographic stick out to you?
Read MoreCollege Students Face Stiff Competition for Financial Aid
USA TODAY recently ran an article about the shrinking pool of financial aid, and how there is more stiff competition than ever for the financial aid that does exist.
Here is the down and dirty according to USA TODAY:
This sounds like depressing news, but I would give a much rosier view of the situation. Yes, the Federal Pell Grant applicant pool has grown tremendously. However, the Pell Grant is a guaranteed award. Meaning if you qualify, you earn it. Our government has set aside enough funds to cover every student that applies. This may not say good things about our government’s fiscal policy, but it should give you some comfort in applying for the Pell Grant. Also, Pell Grant funding has been secured through 2015 according to new legislation.
The article also notes that states have tightened the reins on qualifying for state supported scholarships. This is a sad trend but not one without hope. The positive trend that I have seen in recent years is that colleges have stopped relying as heavily on state supported scholarships, and they have begun relying more on school supported scholarships. Athletic departments are pumping money back into schools to be earmarked for Academic scholarships. Private donors are increasing their contributions which are earmarked for scholarships. Cost cutting measures have freed up University funds to be put back into the scholarship program. Colleges and universities have begun to realize that students are their greatest asset. Just like great employees make a company profitable, great students make a school excel. Scholarship money is one of the main lures to attract top tier students.
The USA TODAY article does go on to give three tips to deal with what they believe is a worsening financial aid situation:
2. Be on the lookout for private scholarships.
3. Use net price calculators as a screening tool, but exercise caution.
I actually strongly agree with all 3 of these points. We have talked numerous times here about how important financial aid deadlines are. Missing a crucial financial aid deadline could mean the difference in thousands of dollars in aid.
Private scholarships, and especially local scholarships, are in my opinion the absolute best source of financial aid. You compete against a limited applicant pool, and you can gain the support of your local community. It’s a win – win!
Finally, the article mentions the debacle that is a net price calculator. The intent was good, the end result was a confusing mess. The net price calculator was a mandate from the Department of Education for all schools to be able to give prospective students an estimate of what they could expect to pay. The net price calculator gives all students an estimate of their tuition and fees, and then subtracts an estimate of their financial aid. The problem is that these estimates are almost always way off. The calculator often does not include private scholarships, and never includes student loans. These differences are not explained to students, which gives them a very skewed view of the financial aid that they can actually expect to receive from one school versus another.
With that said, I firmly agree with this author’s suggestion to take the net price calculator with a grain of salt. It can be a good tool, but should not be your deciding factor.
Have you noticed any drop in financial aid in recent years?
Read More
Federal Student Aid Unlocked: Pell Grant
This post was originally published back in 2009 on the first variation of the Money for College Project. I would selfishly like to think that my writing has improved from these humble beginnings, but it’s probably not true. Regardless of the writing, the information is still gold. The Pell grant is the premiere need based grant funded by our tax dollars and administered by the Department of Education. Complete your FAFSA to qualify for this award and all other federal grants and Stafford student loans.
________________________________________________________________________________________________________________
Every year Federal Student Aid (FSA) provides more than $83 billion in financial aid across their various programs. This money assists about 14 million students attending college. With those staggering numbers I can promise you that if you complete the proper steps I outline here on this blog, you can get a piece of that money!
Over the next few days I would like to explore the different types of Federal Student Aid. With 10 different programs that offer assistance to students, it is easy to get lost in a cloud of numbers and unfamiliar terms. Hopefully, after we have gone through this journey of exploring every program in detail, you will have a better understanding of how you fit into the big picture, and most importantly, where you can go for your money!
Before we get into the individual programs, it is important to note HOW one would go about applying for this aid. GOOD NEWS! It’s simple: The Free Application for Federal Student Aid (FAFSA). With one application you will be evaluated for all 10 FSA programs. Simply go to www.fafsa.gov and follow the steps to submit your application (Intimidated by the FAFSA?? More to come on that later so stay tuned!).
Now that you know how to apply for all these programs, let’s look a little closer at each one.
First: Federal Pell Grant
This is the most important Federal grant as it is the largest grant. Since it is a grant, it does not have to be repaid. The Pell Grant is available exclusively to undergraduate students and your eligibility is determined by your financial need. Your financial need is used to determine how much of the Pell grant you will receive, if any.
For the 2009-2010 award year (which runs July 1st 2009- June 30th 2010), the maximum amount you can receive in Pell is $5350 (**For 20120-2013 the maximum Pell award is stuck at $5500). Depending on which college you attend this could be enough to pay your entire tuition (eg. the school where I (formerly) worked is only $1746 for a full time student, per semester!) Or if it will not pay your entire tuition, the Pell grant will almost certainly make a significant dent in your college tuition bill.
Also, for part-time students, the Pell grant can be applied to your tuition through a scaling award system. Here is an example: If you receive the maximum Pell award of $5350, that breaks down to $2675 in Fall and $2675 in Spring (if you come full time). If you come half time, the Pell amount would be cut in half or $1338 each semester. Now keep in mind, your tuition should also be less, so Pell should cover roughly the same percentage of your tuition bill whether you take full or part-time classes.
Coming up next: Federal Supplemental Educational Opportunity grant (FSEOG)
January = Time to Complete FAFSA to Maximize Your Financial Aid
You’ve all heard it before, “The only two things in life that are certain are death and taxes!” Well, I would like to add a third statement to the mix, “The only three certain things in life are death, taxes, and rising college tuition!”
I imagine that many of you parents who are currently paying, have recently paid, or are researching college prices will readily agree with me. Historically, college tuition rates have increased at roughly 8% annually since 1958. But I am not telling you anything that you don’t already know. College can be expensive!
One of the best ways to mitigate the cost of a rising college tuition is to take advantage f the financial aid funds that are made available by the U.S. Government. Agree with them or not, free money is free money. In fact, it’s partially your money, as these programs are funded by our tax dollars. It is simply a smart idea to take advantage of these funds.
Like everything with the U.S. Government there is red tape, but the Department of Education has made big strides in the past few years to streamline the financial aid application process.
Complete your FAFSA Early
As of January 1, 2012 you are able to complete the 2012 – 2013 Free Application for Federal Financial Aid or FAFSA. This application is a one-stop-shop which will qualify you for every federal aid program, including student loans. You can complete your FAFSA for free here: FAFSA . **A word of caution, there are many sites which will charge you to complete the FAFSA (fafsa dot com). These are not typically scam sites, but rather FAFSA advisors who will do the same thing for you that you can do yourself. Save the $80 and complete your own FAFSA**
It pays to complete your FAFSA as early as possible. Many schools set priority deadline for FAFSA applications. These priority deadlines dictate whether or not you qualify for institutional scholarships and grants, as well as limited federal funds that each school receives. Many federal programs such as the Federal Pell Grant are available to any student who qualifies. The Department of Education estimates this number each year, and allocates sufficient funds to cover these awards. Many other awards however, such as the Federal Supplemental Educational Opportunity Grant (FSEOG) are limited funds, and are distributed by schools on a first come first served basis. The one metric that financial aid offices use to determine this priority status is the date which your FAFSA was submitted.
Taxes Not Done Yet? Estimate Your FAFSA!
It’s common knowledge that you will need your prior year tax information to complete the FAFSA. A student’s financial need is based largely on their income and the income of their parents. However, the federal tax deadline is April 15th, and schools need a FAFSA by the middle of February……see the problem?
With this in mind, the Department of Education has implemented a tool which allows you to estimate your income for the current tax year based on your prior year tax returns. This way you can complete your FAFSA well before the tax filing deadline, and still have a fairly accurate picture of your financial status for financial aid purposes. Once you have estimated your taxes and submitted your FAFSA, your priority date will be set by the date which your FAFSA was submitted.
It is important to note however, that if you choose this option, your FAFSA application cannot be completed until your tax returns are officially filed. Your FAFSA application gets routed through the IRS system to check for errors, so they will obviously know if you have submitted a return or not. You can’t cheat this system. So once you have submitted your federal tax return, simply login to the FAFSA application and make a correction to a competed FAFSA. These changes will be sent directly to your school, and they will begin the process of completing your financial aid package.
IRS Data Retrieval Tool
One very cool new feature for the 2012 – 2013 FAFSA is the IRS data retrieval tool. This was piloted on last year’s FAFSA, but they have made significant changes to the program and it is much more effective this year. If you have already submitted your federal tax retrns, you are able to port your tax information directly from the IRS, and fill out the financial piece of your FAFSA application.
This saves you the time of going through the tricky line items on your 1040 tax forms to fill in the correct figures. It also saves on human errors in transposing a number, or adding an extra zero. This has historically been the most challenging part of the FAFSA, so this should provide a bit of comfort for many parents out there who are nervous about completing the FAFSA.
You will once again run into the timing issue with needing to submit your FAFSA early. You cannot use the IRS data retrieval for a prior year tax return to estimate your current year, but you can use the IRS datate retrieval tool when you make a correction to your completed FAFSA. This tool will still save you time, regardless of when you use it.
A Necessary Evil
The FAFSA is certainly not the model for effiiciency and you will realize that as soon as you begin the process. But it has made significant strides in the last 5 years, and more positive changes are on the way.
The FAFSA is however, the ONLY way to qualify for federal financial aid. If you or your student have any desire to qualify for federal grants (free money!) or receive federal Stafford student loans, then the FAFSA is a necessary evil. However, it can also be a great time to sit down with your student and talk about finances. You can use it as a teachable moment, or even take the opportunity to give your child some autonomy and let them complete it on their own. Scary I know, but it might pay big dividends in the end!
Read MoreMerry Christmas — A Little Early
It’s been a crazy few days for our family. My father in law wound up in the hospital with multiple blood clots in his lungs and will be in the hospital through Christmas Day. So needless to say, we will be spending part of our Christmas stuck in a hospital room.
He’s in great spirits however, not in a lot of pain, and very thankful to still be with us.
So for us this Christmas, we are very thankful to have him still with us. Regardless of whatever gifts come our way this year, that will be the most precious.
With that said, that is the reason I have been a little vacant from the blog the past few days, and why I wont be back to the blog until January. The rest of the Christmas Holiday is going to be spent with family and friends, and enjoying the precious gift of life that we all have.
I hope you all have a great Christmas, and I look forward to coming back in a week or so!
Read MoreSneak Peak at the 2012 – 2013 FAFSA Application
It’s hard to believe that it is almost that time of year again. Beginning January 1st, 2012 you will be able to complete the Free Application for Federal Student Aid (FAFSA).
This financial aid application will be used to qualify you for financial aid for the upcoming Fall semester in August 2012. Yes, it is 8 months in advance, and yes you should do it as soon as possible!
The Department of Education has recently released a sneak peak version of the 2012-2013 FAFSA Application. You cannot actually submit this worksheet, but you can begin working on the draft version today, so you will be fully prepared to submit the real document when it becomes available on January 1st.
Procrastinating on completing your FAFSA could mean the difference in thousands of dollars in college financial aid. For example, the FAFSA deadline for many colleges is February 15th. If you wait until January 1st to begin gathering the documents needed, you will likely miss out on this deadline. If you miss this deadline you will miss the priority date for your college’s scholarships and grants program and lose any potential financial aid you qualified for through your school.
Even though this worksheet is available, you do not want to submit a paper copy of the 2012-2013 FAFSA Worksheet. The electronic application at http://fafsa.gov will be available beginning January 1st, and that is where you should submit your application. Submitting a paper FASFA could take 5-6 weeks to even get to your school, whereas a FAFSA submitted on the web will take a maximum of 48 hours.
There is also a really neat tool that is new this year for the FAFSA called IRS data retrieval. If you have successfully submitted your IRS tax forms, then you can “retrieve” that data through the FAFSA form. When this data is retrieved it will automatically populate the FAFSA form so you do not have to compare line by line figures. This one change alone could save you hours in completing your FAFSA.
The Department of Education may not be perfect, but they are trying very hard to make the FAFSA completion process less of a barrier to applying for Financial Aid. The best way to be prepared is to know what to expect. Print out a copy of this 2012-2013 FAFSA worksheet, and look it over to know exactly what to expect when you sit down to complete your FAFSA in a few short weeks.
Read MoreFollow Us!
