Attending college is becoming more and more expensive. Families who struggle financially might look at the cost of college as an impossible mountain to climb. But with the cost of higher education getting higher every year, even middle- and upper-class families can have a hard time finding the funds.
According to the College Board, the average tuition and fees for out-of-state public universities total about $25,600 per year, while the average private school tuition and fees are now nearly $34,700 a year.
Of course, students have the option to apply for financial aid, not to mention any scholarships for which they qualify. Though the process of applying for funding can be tedious, students should take advantage of college funding opportunities however and whenever they can.
With that in mind, here are seven tips to help students and parents/guardians strategize and get the most out of college funding.
1. File forms as early as possible
Filling out the Free Application for Federal Student Aid, or FAFSA, is usually the first step toward gaining needed college funding. Based on FAFSA applications, the federal government gives eligible students a combined $150 billion a year with grants, student loans, and work-study awards.
Since the FAFSA forms can take time and require absolute accuracy, it’s important to start filling the application out as early as possible. The forms open on October 1, and some awards are granted on a first-come-first-served basis, so it’s in your best interest to get started right away.
Starting early also allows time to proofread multiple times and to fix possible mistakes to make sure you get the most funding available to you.
2. Minimize student assets
One important FAFSA and funding strategy, for example, is to make sure familial assets are in the right name to receive as much funding as possible.
Parents and guardians are only expected to utilize 5.64 percent of their assets for college funding, while students are expected to use 20 percent of their own assets to pay for college. This means that, while gifting a student money for college is helpful and kind, that gift can actually cause that student to get less money in funding from FAFSA.
Parents, grandparents, and any other kind college donors should keep college money for a student in their own names, rather than transferring that money to the student or starting a college savings account in that student’s name.
This will lower the Expected Family Contribution (EFC) and allow students to qualify for more financial aid than if they keep assets in their own name.
Students should also be careful about the money they make from their own jobs and maybe even transfer money from extremely lucrative jobs to a parent’s name before applying for college funding.
3. Understand and utilize FAFSA strategies
Filling out the FAFSA forms requires strategy, not only at the time of completing the forms, but also prior to form completion. Do your research to find out what FAFSA strategies apply to you and your situation and general strategies like applying every year and appealing your funding if needed.
Some strategies might surprise you. For example, if you live with two different parents throughout the years as a result of divorce or separation, it actually benefits you to spend more time living with the parent who makes less money and has fewer assets. Because, when you’re filling out FAFSA, you’ll be required to list the income and assets of the parent with whom you spend the most time.
While certain FAFSA strategies might seem to be gaming the system, with the cost of college so high, following these strategies actually just helps students find ways to more easily access higher education.
4. Fill out FAFSA regardless of income
If you think your family makes too much money to qualify for any college funding, think again. You should still fill out FAFSA, because so many different factors go into determining college funding.
Some factors like whether or not a sibling will be in college at the same time as you or how many people are in your family could still allow you to qualify for subsidized loans. Just fill out the forms and see what happens.
Any help you can get to pay for college is worth the effort!
5. Prepare for merit-based aid possibilities.
One funding mistake some students make is to choose to attend the highest-rated school to which they are accepted, rather than thinking about funding options from other great schools that might be more willing to give them merit-based aid.
You might be one of the highest performing students applying to really great schools, even if those schools are not as highly-rated as your top choice. This often means that really impressive schools could give you merit-based aid, making college much more affordable and lowering the student loans you have to pay off later.
6. Consider even top-rated schools as options
Though students sometimes write off top schools – especially Ivy-League schools – right away by assuming those schools’ tuitions will be too expensive, you might be surprised how accessible some top-tier schools really are.
This is especially true if you have talents or qualities a school really wants, as even Ivy-League schools might offer special funding programs for students hoping to attend. Sometimes, based on how much a school wants you and how much aid is available, even the most expensive Ivy-League schools might be less expensive for you personally than an in-state public university.
The main lesson is to look into all possible options, rather than writing anything off too soon. Though it might take more effort, figuring out what funding will work best will be worth your while.
7. Apply for all possible scholarships.
If you haven’t already, look for all possible scholarships to help augment any college funding you receive. Work on scholarship applications and look for opportunities for scholarships by utilizing your resources – like parents’ companies, community scholarships, special talent-based scholarships, alumni networks, etc.
You’ll likely be surprised how many opportunities are available that you hadn’t yet realized.
As you start the process of applying for college funding, keep all these tips in mind and explore what options will be best for you. Do the work, and you will be able to get the most funding possible and set yourself up for financial success after graduation. Good luck!