What Does It All Mean? Breaking Down Financial Aid Terminology
Posted By: Elynor Moss on October 10, 2019 |
Selecting the right college fit is challenging enough without the added stress of figuring out how you’re going to pay for tuition and additional college costs. Big Future reported that about two-thirds of full-time college students received some form of financial aid to cover the cost of college. To help student-athletes navigate the financial aid process, we’ve created a glossary of financial terms that you need to know before applying to aid.
Types of Financial Aid
This is a financial aid package awarded in partnership between the college coaches and the institution’s athletic department to student-athletes that excel in athletic ability. Athletic scholarships can be awarded as full rides that covers all college costs or a partial scholarship that cover some fees. There are currently only six NCAA sports that offer full-ride scholarships; football, men’s and women’s basketball, women’s gymnastics, tennis and volleyball. Student-athletes can combine a partial athletic scholarship with an academic scholarship, grants and other forms of financial aid to cover the costs of tuition, room and board, books and other costs.
Also called “gift aid”, grants are need-based financial aid that students are not required to pay back. The U.S. Department of Education offers four different types of grants that students attending a four-year institution can apply for by submitting a Free Application for Federal Student Aid (FAFSA) form. Students can also apply for state government, private or nonprofit organizations’ grants if they meet the eligibility requirements.
It’s common for students to take out loans to cover the cost of college. This money is borrowed from the government or a bank and must be paid back over a set period of time and requires the recipient to pay interest on the loan. According to Student Debt Relief, 71% of college graduates walk away with an average of $28,500 in debt.
This type of financial aid is awarded to students for their personal achievements. The majority of merit aid is awarded in the form of a scholarship to students who excel in academics, athletics, the arts and other areas. Merit aid is generally not awarded at top ranked private institutions, as these schools claim their entire student body demonstrate academic excellence and only provide need-based aid.
Cost of Attendance:
The total cost of one academic year before financial aid. This includes the cost of tuition and fees, room and board, books, supplies and living expenses. Colleges adjust the cost of attendance annually, which means your cost of attendance will vary each year.
Cost After Aid (Net Price): Net price is a personal estimate of how much a student will pay for tuition and other fees, as published by the institution, minus any financial aid the student-athlete receives (i.e. grants, scholarships, etc.). To determine net price, student-athletes and their families can use a Net Price Calculator.
Expected Family Contribution (EFC): Students are asked to provide specific information about their family’s financial circumstances, including taxed and untaxed income, assets and benefits, to calculate a family’s financial strength.
Your EFC is used by the state and colleges to determine your eligibility for federal and financial aid.
Demonstrated Need: This is the total amount that your family needs to pay for a particular college. This number is determined by the difference between your expected family contribution (EFC) and the total cost of attendance.
CSS/Financial Aid PROFILE®: Roughly 200 institutions require students to complete a CSS PROFILE, in addition to the FAFSA, to evaluate eligibility for non-government financial aid. Institutions use this profile to award financial aid to qualified students. You can create your CSS PROFILE here. https://cssprofile.collegeboard.org/
Free Application for Federal Student Aid (FAFSA): This is the most widely used need-based financial aid application. This free application allows students to apply for federal financial aid in the form of federal student grants, work-study programs and loans. The federal government uses this application to determine a student’s financial needs and whether they are eligible for financial aid based on the cost of attending college and the expected family contribution (EFC). States use the FAFSA EFC calculation to award state-funded grants and scholarships, and institutions use the FAFSA to award merit-based aid. You can begin your free FAFSA here. https://studentaid.ed.gov/sa/fafsa
Difference between the CSS PROFILE and the FAFSA:
Submission dates: Unlike the FAFSA that has a set submission deadline, usually at the end of June, the CSS PROFILE submission deadline varies from school to school. Most CSS PROFILE deadlines are between January 1 and March 31.
Application questions: The CSS PROFILE asks institution-specific questions based on the school you are applying to, while the FAFSA askes everyone the same generic questions.
Calculation method: The CSS PROFILE takes a more detailed look at your financial needs by asking more specific information than FAFSA, such as whether your family owns a home.
Minimum student contribution: This is only required for the CSS PROFILE.
Professional judgment: Financial aid counselors have more freedom to grant aid to CSS PROFILE applicants based on their particular circumstances.
Cost: The FAFSA is free to fill out, whereas there is a cost to complete the CSS PROFILE. CSS PROFILE applications may qualify for fee waivers if they meet these requirements. https://cssprofile.collegeboard.org/fee-wa...
Student Aid Report (SAR): After you submit your FAFSA, you and your family will receive your Student Aid Report, which will reveal your expected family contribution (EFC).
Priority Date: Some states award financial aid on a first-come, first-serve basis and set a priority date for FAFSA application. To ensure that your application is considered, you don’t want to miss this date. Students are encouraged to complete the FAFSA as close to the October 1 application opening date as possible.
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