Separating fact from fiction
If you have a teenager preparing to go to college, you know there are many steps along the way: choosing, applying to and visiting colleges, and taking standardized tests and preparatory classes. Then there is the financial end of the equation and all the requisite paperwork and head-scratching that is part of the process. This is a very important step and not to be overlooked. There’s some good information out there, but there are also a lot of myths and misconceptions to contend with. Here are a few that you’d do well to consider:
Six common financial aid myths and misconceptions:
Myth: “Financial aid is not a loan.”
Fact: Some people believe that all financial aid is “free” money. That is just not true. In fact, most financial aid packages are a combination of grants that you aren’t required to pay back and loans that must be repaid. Financial aid loans provide other benefits, including lower interest rates that can be deferred during your child’s college years.
Myth: “My family earns too much money.”
Fact: Even if you and your spouse earn good salaries, you may still qualify for financial aid. Your family doesn’t necessarily need to be struggling financially in order to be eligible. The criteria to receive financial aid include how much your family can contribute financially, whether you have a single-parent household, the total number of family members in college, whether your household has dual incomes and the college’s price tag.
Myth: “Only students with excellent grades get aid.”
Fact: Yes, academic achievers may have a better chance of receiving scholarships based on merit, but most financial aid – and all government aid – is based on need, not merit. As long as your child’s grades are satisfactory, he or she is as eligible for federal student aid as is an honor roll student.
Myth: “My daughter wants to go to college part time, so she won’t be eligible for financial aid.”
Fact: The good news is that even students who choose to go to college part time are eligible for financial aid. In fact, in 2009, the federal government announced a $12 billion grant to community colleges, which may provide the most opportunities for part-time education. Talk to the college’s financial aid office for more details concerning your part-time student’s eligibility.
Myth: “We can apply for aid close to or on the application deadline.”
Fact: It’s never a good idea to wait until the deadline to apply. College financial aid and grants get used up fairly quickly, so submit your child’s application as early as possible. You’ll receive the financial aid package sooner, too.
Myth: “Millions of dollars in scholarship money go unclaimed each year.”
Fact: This myth is perpetuated by professional scholarship search services, many of which are scams. The reality is that the government offers 70 percent of all financial aid, and the balance is a combination of college, private and state aid. However, there are still good scholarships available. Search for free at www.scholarships.com and www.fastweb.com or even at your local library, college financial aid offices and especially your teen’s high school guidance office. Your workplace may offer some kind of a scholarship for the children of employees, and clubs or associations you belong to may offer scholarships as well.
Sorting through some of the common myths and misconceptions of the financial aid process is important so that you can obtain the most financial assistance for your teen’s higher education. Sharing this information with family and friends might also help others who may be confused regarding this issue. If you need further financial help, feel free to visit us at any of eighteen UCCU branch locations where one of our Member Service Representatives can assist you regarding college loans and more.