February is Financial Aid Awareness Month ...

Since even in-state college costs often total more than $70,000 over four years and some private school costs may even approach $200,000, financial aid is an extremely important and relevant topic - especially at this time of year, and especially in this economy. 

Although college may still be several months away, for parents this is the time of year when application and acceptance responses from colleges are quickly followed by phone calls to the Financial Aid Office to find out how much out-of-pocket a school’s tuition, room and board and other costs will absorb.  

Whenever a college Admissions staff or Financial Aid Office gets a question from a parent about costs, scholarships, grants, etc., they will almost always respond by telling you to complete the FAFSA (Free Application for Federal Student Aid).  No matter what a parent’s income is, if you are applying for any type of financial aid (including scholarships, grants, government student aid and/or loans, school loans, parent loans, etc.) you will be required to complete the FAFSA. 

Many universities have significant endowments and rich alumni resources. Consequently they are often able to offer a variety of attractive financial incentives (both grants and loans) to encourage accepted students to enroll at their school. However, these incentives are almost always offered on a first come, first served basis.  So the earlier you complete your FAFSA, the better chance you have of receiving financial aid of one type or another.  Be aware too that many colleges have deadlines for filing Applications for Financial Aid.  Check each college’s web site or ask their Admissions Department for applicable dates.  Be aware that most college endowments and alumni donations have been reduced significantly in the current economic downturn so it is more important than ever to file your FAFSA early this year. 

Completion of the FAFSA is not as difficult as many people fear. It is recommended that you complete it on-line (at www.fafsa.ed.gov/) since the form has a good amount of self-help tutorials available which greatly reduce the risk of errors.  Note that you will need your completed 2009 tax information available before filing (if your 2009 tax return is not complete yet, you may use estimates based on your 2008 filing and your expected 2009 filing.  Remember that if you estimate, you will later be required to provide documentation once your return has been filed). 

While filing the FAFSA early may provide added financial opportunities, filing it on time is essential.  Schools often vary in the deadlines they attach to the FAFSA filing so you’ll need to check with each school to confirm their own deadline.  One final note, regardless whether you file the FAFSA on-line or in hard copy, be sure you keep copies of all forms and supporting documents for your own records. 

Finally, on a related college cost topic, if you have applied to universities, or if you have received acceptance letters to those you have applied to, spend some time reviewing the various academic scholarships they offer through their Admissions process.  Be aware of scholarship application deadline dates and make sure that you apply on time.  Review the school’s Admissions web pages in detail and check out free Internet scholarship resources such as www.fastweb.com. 

See also:  How to Compare College Financial Offers (click here)