Consumer Wise: Maximizing your financial aid

By Angie Moreschi, Reporter
Last Updated: Tuesday, September 05, 2017, 5:18 AM EDT

"I just had some questions about my financial aid," University of South Florida student Monica Moricette said as she walked up to the counter at her college’s financial aid office.

Moricette is thankful for a generous financial aid package from USF and wanted to make sure all her documents were in order to cover her fall tuition.

"I think it's really important, especially if you live on campus, ‘cause the cost is relatively high, and if you don't fill out your financial aid, you will be in trouble," Moricette said.

The FAFSA

Your first step in getting a financial aid package is filling out a Free Application for Federal Student Aid, or FAFSA. For students applying to colleges now for the 2018-19 school year, the application will, once again, be available starting on Oct. 1, which is earlier than in past years.  

The key to determining how much financial aid you can get is figuring out your Estimated Family Contribution or EFC, which is based on the information you enter into the FAFSA application. Your EFC is how much the government thinks your family can afford to pay towards college.

The key factors considered are:

  • family size
  • parent and student income
  • assets
  • number of children in college
  • the parents' age

“It looks at income. It looks at the number in the household. A family of four versus a family of eight, you can have a higher income and qualify if you have eight,” said USF Associate Vice President Billie Jo Hamilton who is in charge of financial aid at the school. “It also looks at how many children are in college, so if you have multiple students in college that’s taken into account.”

Parent assets are also considered, but are counted less the older parents are.

"The closer the parent is to retirement age, if they have assets, they count fewer assets, because they assume folks need their retirement money, right," Hamilton explained.

Financial Aid Packages

Schools look at the FAFSA to decide everything from grants and scholarships to subsidized loans and work-study.

“Grants and scholarships, we call gift aid, because they don’t have to be repaid,” Hamilton said. Scholarships are usually based on some skill or merit — academics, athletics, whatever, and grants are typically based on need.”

If you don't qualify for grants, you can still qualify for aid like federal work-study.

“The advantage for students to work on federal work study versus at a fast food restaurant, for example, is that — if it’s federal work-study, then it doesn’t count when they fill out the FAFSA, because it’s financial aid,” she said.

You can also still qualify for loans. If you need to borrow money to pay for college, it’s better to start with federal student loans.

Federal student loans include many benefits like fixed interest rates and income-driven repayment plans not typically offered with private loans. In contrast, private loans are generally more expensive than federal student loans.

Apply Early

The most important tip: fill out your FAFSA early to get the best shot at the most aid.

"Some schools have limited amounts of free money," Hamilton said. "Don't wait to be admitted. Do it as soon as you apply."

Be sure to check a school’s Priority Deadline for financial aid and be sure to get your FAFSA submitted by that date.

Monica forced herself to get it done and is glad she did.

"I'm a procrastinator, but that's not something you wait ‘til the last minute to fill out, cause when you need it, you need it," Moricette said.

Biggest Mistake

There is no specific income cut-out for financial aid, since it depends on so many factors, so don't count yourself out, before applying.

Without aid, the cost of attendance at USF for in-state students is nearly $25,000 a year and nearly $33,000 a year for out-of-state students. At even more expensive private schools, like Duke, Harvard or Johns Hopkins, the cost of attendance can top $60,000.

To find out your financial need, schools subtract your FAFSA Estimated Family Contribution from their cost of attendance — which includes tuition, room and board, and miscellaneous fees.

“Definitely fill out the FAFSA, that’s the first step,” Hamilton advised. “A lot of our middle income families qualify for aid. You don’t get what you don’t apply for.”

It's worth the effort. In recent years, nearly 90-percent of full-time college students got some form of financial aid.