Professional Documents
Culture Documents
2014 Fan
2014 Fan
2014 Fan
College Expenses
80% of jobs require some form of post-secondary education (not necessarily a 4-year degree).
Unskilled jobs are disappearing; demand for high skills is rising The FACTS:
100% 80% 60%
54% 16% 10% 40% 19% 26%
80% of jobs today require some sort of training beyond High School
Professional Skilled Unskilled
40% 20% 0%
1950
1994
2011
Source: U.S Bureau of Census and Pennsylvania Department of Labor & Industry, Center for Workforce Information & Analysis (Pennsylvania statewide)
Does your student have a plan? (from the Gallop Student Poll)
The PURPOSEFUL:
Found something meaningful, sustained, interest and clear sense of future purpose
The DISENGAGED:
Neither a purpose in life nor an inclination to find one
The DABBLERS:
Tried potentially purposeful pursuits, yet to commit
The DREAMERS:
Imagining great things, no practical pursuits
Grants 52%
Student loans 39%
SOURCE: U.S. Department of Education, National Center for Education Statistics. (2009)
Merit-Based Aid based on - academic ability, special talent or achievement, program of study, family or ethnic background Need-based grants, loans, and employment usually based on - income, assets, other factors
Basic Principles
Joint responsibility of the student and parent(s) to pay, to the extent possible. Not all families qualify for need-based aid. There is no guarantee that you will get any need-based financial aid to pay for higher education.
Used to determine student eligibility for: Federal programs State programs School programs
FAFSA
The FAFSA may be filed beginning on January 1 of the senior year of high school. Complete the FAFSA as soon as possible after January For the 2014-15 academic year, the FAFSA may be filed beginning January 1, 2014
www.fafsa.ed.gov
Who is independent?
24 or older on Jan 1st of award year (born before January 1, 1990) Veteran (includes active duty personnel) Working on graduate level degree Emancipated minor in legal guardianship Orphan, in foster care, or ward of the court at anytime when student was age 13 or older Have legal dependents other than spouse Student deemed homeless by proper authority
What school costs are considered by the financial aid office at the school?
School costs include: Tuition and fees Room and board Books and supplies Transportation Miscellaneous living expenses
GIFT AID: 22,000 SELF AID: 17,500* OUTSIDE AID: 3,000 Total: 42,500 Balance: $ 9,160
True cost Balance: 9,160 Self Aid 17,500* Total debt: $ 26,660 EFC = 0 * Discretionary: PLUS Loan Work Study Alternative Loans
Federal Programs
Pell Grant (2013-14 max award $5645) *.must have high need Campus-based aid amounts determined by FAO FSEOG up to $4000 Perkins loan... up to $5500 Federal work-study FAO determines
Americorps
for details, go to www.americorps.gov
Statistics
Number of student loan borrowers in the US: 37 million Percentage of borrowers who owe less than $6000: 25% Average starting salary for 2012 college graduates: $44,482 Unemployment rate for college graduates: 4.6% Percentage of 2010 college graduates working jobs that require less than a high school diploma: 38% Student borrowers under the age of 30: 14 million Number of Americans age 60 or older who owe money on student loans: 2.2 million
debtsecond only to mortgages. 1-in-5: U.S. households that have student loans. $26,682: Average outstanding balance for a borrower with student debt. 1-in-8: Share of borrowers with more than $50,000 in student debt. $165 billion: additional Private Loan Debt
www.studentloans.gov
Servicers
Fed Loan Servicing (PHEAA) Nelnet Sallie Mae Great Lakes
You may look up your servicer and their contact information at any time on www.nslds.ed.gov
Additional Eligibility
Repayment Examples
Loan Balance: Adjusted Loan Balance: Loan Interest Rate: Loan Fees: Loan Term: Minimum Payment: $27,000.00 $27,000.00 3.86% 0.00% 10 years $50.00
$271.57 120
$32,588.25 $5,588.25
It is estimated that you will need an annual salary of at least $32,588.40 to be able to afford to repay this loan. This estimate assumes that 10% of your gross monthly income will be devoted to repaying your student loans. This corresponds to a debt-toincome ratio of 0.8. If you use 15% of your gross monthly income to repay the loan, you will need an annual salary of only $21,725.60, but you may experience some financial difficulty.
*source: www.finaid.org
Repayment Examples
Loan Balance: Adjusted Loan Balance: Loan Interest Rate: Loan Fees: Loan Term: Minimum Payment: $16,000.00 $16,000.00 3.86% 0.00% 10 years $50.00
$160.93 120
It is estimated that you will need an annual salary of at least $19,311.60 to be able to afford to repay this loan. This estimate assumes that 10% of your gross monthly income will be devoted to repaying your student loans. This corresponds to a debt-to-income ratio of 0.8. If you use 15% of your gross monthly income to repay the loan, you will need an annual salary of only $12,874.40, but you may experience some financial difficulty.
*source: www.finaid.org
$19,311.57 $3,311.57
True or False?
Determining Affordability
Approach this as though you are not buying a school, you are buying an EDUCATION. Look at sticker price!! Tuition costs in PA range from $2,500 to more than $40,000.PLUS room and board. Understand that in higher education there is no direct correlation between cost and quality. Be open minded and diverse in college searches. Think in terms of yesterdays money, todays money, and tomorrows money. Determine how much you can afford to borrow. Set some parameters right up front.
Packaging Example
Low Cost Pell Grant State Grant Loans Merit Aid Work Total Aid Gap (what you owe) Actual Cost (Cost Free $) $19000 $2000 $2500 $5500 $0 $0 $10000 $9000 $14500 Medium $29000 $2000 $2500 $7000 $0 $1800 $13300 $17500 $24500 High $38000 $2000 $3100 $8000 $8000 $3000 $24100 $16900 $24900
Special Circumstances
Recent death or disability Reduced income
Contact the school and ask for a special consideration AND Contact State Grant Division at PHEAA
MySmartBorrowing.com
MySmartBorrowing.com
Resources
PHEAA toll free: 1-800-692-7392 Federal Student Aid Info Center 1-800-433-3243 www.pheaa.org www.EducationPlanner.org www.Mysmartborrowing.org www.Youcandealwithit.com www.Myfedloan.org www.fafsa.ed.gov www.federalstudentaid.ed.gov general financial aid info www.studentloans.gov information on federal loans www.nslds.ed.gov - information on your specific loans (need 4-digit PIN to access)