Student financial aid in the United States: Difference between revisions
Line 243: | Line 243: | ||
* {{dmoz|Reference/Education/Colleges_and_Universities/Financial_Aid|Financial Aid}} |
* {{dmoz|Reference/Education/Colleges_and_Universities/Financial_Aid|Financial Aid}} |
||
* [http://studentaid.ed.gov Federal Student Aid] - U.S. Department of Education |
* [http://studentaid.ed.gov Federal Student Aid] - U.S. Department of Education |
||
* [http://needycollegestudents.com College Money Help] |
|||
Revision as of 16:09, 18 March 2010
This article needs additional citations for verification. (July 2009) |
Template:Wikify is deprecated. Please use a more specific cleanup template as listed in the documentation. |
Student financial aid refers to funding intended to help students pay educational expenses including tuition and fees, room and board, books and supplies, etc. for education at a college, university, or private school. General governmental funding for public education is not called financial aid, which refers to awards to specific individual students. Certain governments, e.g. Nordic countries, provide student benefit. A scholarship is sometimes used as a synonym for a financial aid award, although grants and student loans are also components of financial aid packages from students' intended colleges. [1]
Types of financial aid
Financial aid may be classified into two types based on the criteria through which the financial aid is awarded: merit-based or need-based.
Merit-based
Merit-based scholarships include both scholarships awarded by the individual college or university and those awarded by outside organizations. Merit-based scholarships are typically awarded for outstanding academic achievements and minimum SAT or ACT scores[2] , although some merit scholarships can be awarded for special talents, leadership potential and other personal characteristics. Scholarships may also be given because of group affiliation (such as YMCA, Boys Club, etc.). Merit scholarships are sometimes awarded without regard for the financial need of the applicant. At many colleges, every admitted student is automatically considered for merit scholarships. At other schools, however, a separate application process is required. Scholarships do not need to be repaid as long as you meet all scholarship requirements. [3]
Athletic scholarships are a form of merit aid that take athletic talent into account.
Need-based
Need-based financial aid is awarded on the basis of the financial need of the student. The Free Application for Federal Student Aid (FAFSA) is generally used for determining federal, state, and institutional need-based aid eligibility. At private institutions, a supplemental application may be necessary for institutional need-based aid.
Debt vs. grants
No loan financial aid
In 2001, Princeton University became the first university in the United States to eliminate all loans from its financial aid packages. Since then, many other schools have followed in eliminating some or all loans from their financial aid programs. Many of these programs are aimed at students whose parents earn less than a certain income — the figures vary by college or university. These new initiatives were designed to attract more students and applicants from lower socioeconomic backgrounds, reduce student debt loads, and provide the offering institutions with an advantage over their rivals in attracting commitments from accepted students. As of March 25, 2008,[4] the list of colleges and universities offering such no-loan financial aid packages includes the following
School | No-loan financial aid for families meeting these eligibility requirements: |
---|---|
Amherst College | No max of income |
Arizona State University | Arizona residents with family income of up to $60,000 [5] |
Bowdoin College | No max of income [6] |
Brown University | Family income below $100,000 [7] |
Caltech | Annual income below $60,000 [8] |
Claremont McKenna College | No max of income [9] |
Colby College | No max of income; all students [10] |
Columbia University | All students eligible for financial aid regardless of family income[11] |
Cornell University | Annual income below $75,000 |
Dartmouth College | Annual income below $75,000 [12] |
Davidson College | No max of income |
Duke University | Annual income below $40,000[13] |
Emory University | Annual income below $50,000 |
Haverford College | First-year students with financial need. [14] |
Harvard University | No max income |
Lafayette University | Annual income below $50,000[15] |
Lehigh University | Annual income below $50,000[16] |
MIT | Annual income below $75,000[17] |
University of Maryland, College Park | Maryland resident with 0 EFC. [18] |
Michigan State University | Michigan resident with family incomes at or below the federal poverty line. [19] |
Northwestern University | Family income lower than approx. $55,000. [20] |
North Carolina State University | Income less than 150% of the poverty line. Requires the family to have "limited assets," regardless of state residency. [21] |
University of Chicago | Students who demonstrate financial need and whose annual family income totals $75,000 or less.[22] |
UNC Chapel Hill | 200% of federal poverty line ($24,000 to $37,000) |
University of Pennsylvania | Annual income below $100,000 [23] |
Pomona College | No max of income [24] |
Princeton University | No max of income |
Rice University | Annual income below $80,000 |
Stanford University | Annual income below $45,000 |
Swarthmore College | Anyone with financial need [25] |
Tufts University | Annual income below $40,000[26] |
Vanderbilt University | No cap.[27] |
Vassar College | Annual income below $60,000.[28] |
University of Virginia | 200% of federal poverty line ($24,000 to $37,000) |
Washington and Lee University | No max of income |
Washington University in St. Louis | Annual Income below $60,000[29] |
Wellesley College | $60,000[30] |
Wesleyan University | $40,000[31] |
College of William and Mary | $40,000 (VA residents only) |
Williams College | No max of income |
Yale University | No max of income |
Loan cap
Some universities have opted to have a "loan cap" program, which is a maximum loan — either per year or for the four years combined — designed to reduce the cost of attendance for low-income and middle-class students. The following schools have a loan cap program:
School | Loan Cap for students meeting these eligibility requirements: |
---|---|
Brown University | Family earning less than about $125,000: Caps total loans to $3,000 per year. Family earning up to $150,000: Caps total loans to $4,000 per year. Family earning up to $150,000: Caps total loans to $5,000 per year. |
University of Chicago | "Those whose families make between $60,000 and $75,000 will have 50% of their loans replaced."[22] |
Cornell University | Undergraduates with family incomes less than $120,000 will have loans limited to $3,000 per year. |
Duke University | Undergraduate students with family income between $40,000 and $100,000 will have their loans limited on a graduated basis ($1,000 to $4,000 per year) and loans "frozen" at the freshman level. [13] |
Emory University | "Annual assessed incomes of $50,000 to $100,000 who demonstrate need for financial aid. The program caps total need-based loans at $15,000, assuming on-time progression toward graduation with up to eight semesters of study."[32] |
Grinnell College | "Beginning in the 2008-09 academic year, need-based loans for all eligible students will be capped at $2,000 per year."[33] |
University of Maryland, College Park | Students with need-based financial aid will have their loans capped at $15,900 for their four years of attendance.[18] |
Middlebury College | Family income below $40,000: $1,500 per year; family income $40,000 to $80,000: $2,500 per year; family income above $80,000: $3,500 per year. [34] |
Rice University | Students with a family income below $60,000 will not have loans. Families with incomes over $60,000 will have their loans capped at about $14,500. |
University of Virginia | 200% of federal poverty line ($24,000 to $37,000). Loans are capped at 25% of the in-state cost of attendance, regardless of state residency. |
In the United States
The United States, federal government provides need-based federal aid called Federal Student Financial Aid, which is composed of different programs, grants, and scholarships, work and loan programs including Federal Pell Grants, Federal SEOG Grants, SMART Grants, Academic Competitiveness Grants (ACG Grant), Federal Work-Study Program, Federal Stafford Loans (in subsidized and unsubsidized forms), Federal Perkins Loans, State Student Incentive Grants and Federal PLUS Loans. Federal Perkins Loans are made by participating schools per annual appropriations from the U.S. Department of Education, whereas Federal Stafford Loans and Federal PLUS Loans are made by participating lenders under the Federal Family Education Loan Program (FFELP). The U.S. Department of Education serves as a lender and guarantor under the William D. Ford Direct Loan Program.
To qualify for federal student aid, a student must file the Free Application for Federal Student Aid (FAFSA). The FAFSA uses a calculation taking into account income and assets to determine a student's Expected Family Contribution (EFC) toward his or her college education for that year. Colleges use the EFC to decide what types of financial aid a student is eligible to receive. Students must complete the FAFSA each year to be considered for financial aid and must complete an entrance and exit survey.
The EFC also takes into consideration any participation in college savings or pre-paid tuition plans. In the past, financial aid officers weighed pre-paid tuition plans more heavily than other 529 college savings plans when determining a student’s eligibility. In February 2006, Congress passed legislation to treat both types of plans evenly.
State governments also typically provide some types of need- and non-need-based aid, consisting of grants, loans, work-study programs, tuition waivers, and scholarships. Individual colleges and universities may provide grants and need- and merit-based scholarships. Students requiring financial aid beyond what is offered by their institution may consider a private (alternative) education loan, available from most large lending institutions. Typically, education loans obtained through the federal government have lower interest rates than private education loans.
Institutions may also offer their own student financial assistance, in the form of need- or merit-based aid, as well as endowed scholarships (with varying need and/or merit-based criteria). Some schools may only require the FAFSA; some may also require an additional need-based analysis document, such as the CSS/Profile, to apply for such funds to apply a more stringent need analysis for the rationalization of institutional funds.
Outside the United States
Many national governments provide student financial assistance subsidies, i.e. student benefit, for students attending a university, although proposed policies to change such subsidies have engendered considerable debate in several countries, such as Canada, the United Kingdom, Germany, the Netherlands and Scandinavian countries. The heavy reliance on private subsidies, as in the United States, is not as widespread, although this may be changing.
In Germany, the main source of financial aid is provided by the Bundesausbildungsförderungsgesetz, colloquially known as BAFöG.
See also
References
- ^ "Common Financial Aid Questions at Scholarships.com". Retrieved 2009-09-25.
- ^ "Academic Scholarships and Merit Scholarships at Scholarships.com". Retrieved 2009-09-25.
- ^ Scholarships, Grants, Student Loans, and Other Financial Aid Resource
- ^ FinAid - No Loans for Low Income Students
- ^ President Barack Obama Scholars | Arizona State University
- ^ Bowdoin Eliminates Student Loans While Vowing to Maintain its Com, Campus News (Bowdoin)
- ^ 07-105 (Financial Aid Changes)
- ^ Caltech Press Release, 12/11/2007, Jean-Lou Chameau
- ^ News Release, News and Events, Claremont McKenna College
- ^ Colby College | News & Events | Colby Replaces Loans With Grants, Allowing Students to Graduate Without Debt
- ^ Columbia News ::: Columbia Expands Financial Aid
- ^ Dartmouth News - Dartmouth announces new financial aid initiative - 01/22/08
- ^ a b New Financial Aid Support
- ^ Haverford College News Room
- ^ Lafayette strengthens financial aid
- ^ Lehigh to enhance financial aid policy
- ^ MIT to be tuition-free for families earning less than $75,000 a year - MIT News Office
- ^ a b Interpretations, TERP Magazine Winter 2005
- ^ Spartan Advantage Program | Office of Financial Aid | Michigan State University
- ^ <Northwestern: Grants Replace Loans for Neediest Students>
- ^ Pack Promise
- ^ a b The University of Chicago: Odyssey Scholarships
- ^ Penn Admissions: Paying for a Penn Education
- ^ Pomona College : News@Pomona
- ^ Swarthmore College :: Financial Aid :: More about Swarthmore's
Expanded Financial Aid Program - ^ Tufts E-News: Tufts University Eliminates Loans for Lower Income Students
- ^ http://www.vanderbilt.edu/expandedaidprogram/
- ^ Vassar College further strengthens commitment to access and affordability
- ^ WUSTL to expand financial aid for low-income families
- ^ Wellesley College Increases Financial Aid
- ^ http://www.wesleyan.edu/cgi-bin/cdf_manager/template_renderer.cgi?item=57727
- ^ Loan Cap Program
- ^ Tuition and Financial Aid - Grinnell College
- ^ Financial Aid
External links
- Financial Aid at Curlie
- Federal Student Aid - U.S. Department of Education
- College Money Help