Financial Aid Basics. What you need to know.

What is Financial Aid? Really... what does it mean?

It’s money. Money (given, borrowed or earned) that can help students and their families to pay for post-secondary education and training like college, university or career training schools and programs; financial aid helps make these schools and programs affordable for you. Knowing the financial aid basics can go a long way in helping you to find it, apply for it, and get it.

The intention of financial aid is to make up the difference between what it will cost to attend that school and what you and your family can afford to pay. Now you need to know the details….

  • What will it pay for?
  • Who gives it?
  • How is it determined what you qualify for?
  • What types are there?
  • Who’s eligible for financial aid?
  • How do you get it?
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Those questions… they’re just the tip of the iceberg when it comes to what you should know if you expect to get the help you need to pay for college or career training.  Financial aid can be an amazing gift, or turn into a tremendous burden. You want the gift, not the burden.

Is this post going to give you all of the information you need to know? Nope. But it WILL give you the financial aid basics so that you know what to look for as you educate yourself with the knowledge you need which will empower you to make wise decisions about financing your education. Lofty goals I know, but true. It’s the basics… but it’s a ridiculously good start.

What will Financial Aid pay for?

Financial aid can help to cover many of the expenses that are included in the cost of attending a college, school or training program; costs that you might not have even known about or considered.  Expenses like:

  • Tuition
  • Operating Fees
  • Housing
  • Food
  • Books, Supplies and Software
  • Transportation
  • Personal Expenses

These expenses add up to a lot of money, but we knew that. It’s a well known fact that getting an education or training after high school can be expensive, ludicrously expensive.

We need to think of college or career school as something we’re buying, and when we’re buying something don’t we want the best product at the best price? Don’t we look for deals and other resources that will make our purchase affordable and within our budget? And if what we want to buy is totally out of our reach financially don’t we do our research to find the next best product that not only meets our needs but is also an option that we CAN afford?

That’s how you need to look at the education you’re buying when it comes to financial aid.

But here’s the difference… unlike most things you buy your education has a lot of financial assistance programs and resources that can bring the cost down big time. Financial aid can make even the most expensive college or school an affordable option so don’t get sticker shock and not apply to a school based on the “retail price” you see on their website or their course catalog; you might just end up getting a bargain basement price based on your financial aid package!

Want a FREE Financial Aid “Cost of Attendance” worksheet to help you track the expenses for various schools, colleges and training programs you’re interested in? Click the button below to get it. It’s a “view only” Google doc so make a copy of it for yourself so that you can fill it in with your school specific info.

Sources of Financial Aid. Where does it come from?

We’ll make this simple for now… you just need to know that these are the 4 major sources of financial aid that you might get money or assistance from:

  • The federal government. The US Department of Education.
  • The US state that you live in.
  • The college, university or career training school that you’ll be attending.
  • Banks, associations, businesses, foundations & other private companies and organizations.

Types of Financial Aid. In the simplest terms possible.

Since this post is all about  the financial aid basics of “what you need to know”, I don’t want to go into detail about the types of financial aid (because there can be a lot of detail), so for now just know that these are the 4 primary categories of financial aid:

  • Grants
    • Free money you don’t have to pay back.
  • Scholarships
    • Free money you don’t have to pay back.
  • Work-Study
    • Money you earn at a job.
  • Loans
    • Money that you borrow and which you’ll have to pay back with interest.
      • Federal Government- Subsidized and Unsubsidized loans. There’s a big difference re: interest that you need to know.
      • Private Banks

Who Can Get Financial Aid? How do you know if you qualify?

Pretty much anyone can get some form of financial aid, but obviously that varies depending on the person and the source of aid. As far as federal financial aid, which is the largest provider of financial aid, there are some specific eligibility requirements:

  • Financial need (although not always, so you should absolutely apply anyway)
  • US citizen or Eligible Non-citizen
  • Must have a valid Social Security Number
  • Registered with the Selective Service (the military) if you’re male and between 18 and 25 years old.
  • Enrolled, or accepted for enrollment, as a regular student in an eligible degree or certificate program.
  • Enrolled at least 1/2 time to be eligible for the the federal Direct Loan Program (more about that later)
  • Maintain satisfactory grades and progress while you’re in college or career school
  • Have a high school diploma or equivalent, or have successfully completed homeschooling per your state’s DOE laws.
  • Limited eligibility for students with criminal convictions, but in many cases there is eligibility.

But keep in mind… even if you don’t qualify for FEDERAL financial aid you may very well qualify for aid from other sources like the school you’ll be attending, your state, or even private organizations that offer scholarships and other forms of aid!

How Do You Get Financial Aid?

You apply for it. Simple as that.

First of all, It starts with the FAFSA (Free Application for Federal Student Aid) but there are likely other forms and applications that you’ll need to submit based on the schools you’re applying to and the state you live in.

And that’s it. The financial aid basics of what you need to know.  If you realize it would be helpful to learn more about the world of Financial Aid then check out the course at the link below.  You’ll be glad you did!

Those are the Basics. Now get the Details....

financial aid course

The Course: "Financial Aid. What you need to know."

If you want, or need, a much more in-depth and comprehensive (but simple to follow) overview and explanation about:

  • The world of Financial Aid
  • Funding your education and training
  • Tools and resources that can help you
  • What to know and look for so that you can potentially save thousands of dollars…

Then check out the “Financial Aid. What you need to know.” course.  You’ll be glad you did!