Category Archives: UCanGo2 Resources

Federal Student Loans: Pros and Cons

The FAFSA is one application for a variety of federal and state financial aid programs. The William D. Ford Federal Direct Loan Program is one. Before accepting loans, be sure you understand how they work. Student loans are in investment in your future, and the following information can help you be a smart investor.

Pros

  • Student loans are disbursed at a fixed rate, meaning the interest rate for the loan will never change. This is often considerably lower than private student loan sources. The interest rate for federal student loans disbursed during the 2017-18 school year is 4.45%.
  • No credit check is required. Federal student loans are available to you because you’re pursuing education beyond high school.
  • For students who qualify for subsidized student loans, the federal government pays the interest on your loan while you’re still in school, saving you money in the long run.
  • When it’s time to repay your student loans, you’ll have several repayment plan choices designed to fit your specific needs.

Cons

  • Not all students qualify for subsidized student loans. The information you provide on your FAFSA determines eligibility.
  • Student loans must be repaid, and debt adds up quickly. Keep track of your student loan debt while you’re in school by visiting the National Student Loan Data System.
  • There is a cap to how much you can borrow, so be sure you’re seeking other types of financial aid as well.

To learn more about how to be a smart borrower, check out ReadySetRepay.org. You’ll find information about borrowing smart from the start, estimating your loan payments, and repayment options.

Apply Now

During your Thanksgiving break, be sure to carve out some time to submit your Free Application for Federal Student Aid (FAFSA) for the 2018-19 academic year. It may sound like Fall, 2018 is a long time away, but consider these reasons to apply now:

  • Some forms of financial aid are first-come, first-served. When this type of aid is gone, you may have to wait for the next school year to apply for it again.
  • More and more colleges are setting early enrollment and institutional scholarship deadlines in November and December. During the application process, they’ll want to know if you’ve submitted your FAFSA.
  • It’s not uncommon for a scholarship committee to ask for a copy of your Student Aid Report (SAR) that you receive after you submit your FAFSA. Completing your FAFSA early ensures that you won’t miss important deadlines.

For more information about completing the FAFSA, visit StudentAid.ed.gov.

What is Federal Work-Study?

Federal Work-Study provides part-time jobs for students to earn money to help pay for school. Work-Study positions exist in various departments across campus (and sometimes off campus).

There are several perks to Work-Study positions. First, they’re flexible. Schools know a student’s classes are their number one priority, and they know class schedules change each semester, so they work with students to build work schedules around class schedules. They are also often flexible if students need time off to study for a test or work on a class project.

Second, Work-Study jobs exist all across campus. Students can work in the bookstore, with the grounds or maintenance crews, in an academic department or in a variety of other areas. Some schools even have Work-Study positions off campus. This allows students to find a job that fits their interests.

Finally, Work-Study positions offer competitive pay. Students will earn at least minimum wage. At some schools, pay starts above minimum wage or increases with length of employment.

Work-Study funds are limited, so students should complete the FAFSA early and begin applying for Work-Study jobs as soon as possible.

To learn more about the Federal Work-Study program, visit the Federal Student Aid website or ask the financial aid off at your college.

HELPFUL FAFSA RESOURCES

Completing the Free application for Federal Student Aid (FAFSA) can be stressful, especially for students who are already weighing the options of various universities or career techs, applying for scholarships and studying for the ACT or SAT—and all while still trying to be regular high school students! That’s why the Oklahoma College Assistance Program (OCAP) offers various resources to help families understand and navigate their way through the FAFSA.

StartWithFAFSA.org offers a number of articles and links to help you as you complete your FAFSA application. Check out these great posts and resources:

Don’t forget: the 2018-19 FAFSA became available on Oct. 1, so high school seniors should complete this form as soon as possible. Visit FAFSA.gov to start the process today!

Completing the FAFSA

Completing the FAFSA is as easy as 1, 2, 3… 4, 5!

  1. Gather Materials – You’ll need your social security card, current bank statements and, if you’re a dependent student, your parent(s)’ information. For the 2018-2019 FAFSA, you’ll also need your 2016 W2s and tax returns.
  2. Create an FSA ID – This username and password is used to electronically sign your FAFSA and other important financial aid paperwork. Visit fsaid.ed.gov to sign up.
  3. Fill It Out – The FAFSA is available at FAFSA.gov after Oct. 1 each year. Check out the Help and Hints box on the right side of the screen for assistance on answering each question.
  4. Sign & Submit – Enter your FSA ID to serve as your electronic signature. Don’t forget to click Submit at the bottom of the screen.
  5. Follow Up – Watch your email for a Student Aid Report (SAR) and information from the schools who’ve received your FAFSA results. Be sure to follow up with the financial aid office at your school if you have additional questions.

For more details, check out Finish the FAFSA in Five Steps or watch the Finish the FAFSA in Five videos, available in English and Spanish.

DON’T MAKE THE MISTAKE OF NOT APPLYING!

Completing the Free Application for Federal Student Aid (FAFSA) has never been faster or easier. However, there’s one mistake students and their parents often make: not completing the FAFSA at all!

Each year, many families don’t complete the FAFSA because they think they make too much money to qualify for aid. Counting yourself out before even starting is a huge mistake! Even if you think you won’t qualify for aid, you should still submit the FAFSA anyway.
Here’s why:

  • You could be missing out. Billions of financial aid dollars are offered every year. Those funds will be awarded to someone… and that “someone” could be you. But you’ll never know if you don’t apply!
  • Your school might use the data for other financial aid. Some schools use the data on your FAFSA to award school-specific grants and scholarships. So, in addition to missing out on federal funding, you could take yourself out of the running for school aid by choosing not to submit the FAFSA.
  • Federal student loans offer options. Even if you’re positive you’ll only qualify for student loans and you’re unsure about borrowing money for school, federal loans could be your best option. Federal student loans often have lower interest rates than private or alternative loans, and they offer flexible repayment plans. They’re also a better option than high interest credit cards.
  • There’s no obligation. You’re not required to accept the aid offered to you. You’ll have the option to decline any aid offered, or you may choose to limit how much you borrow.

The FAFSA is available on Oct. 1, so apply as soon after as possible at FAFSA.gov!

Get Your FSA ID Before You Start the FAFSA

The Federal Student Aid Identification (FSA ID) is used to log in to certain FSA websites, such as FAFSA.gov. It’s comprised of a username and password. If you used a the old PIN system to sign your last FAFSA, you’ll be given directions on how to set up an FSA ID the next time you log in at FAFSA.gov.

Setting up an FSA ID is easy, and it’s strongly recommended that you set it up before you start the FAFSA. Simply visit fsaid.ed.gov, click ‘Create an FSA ID,’ and fill in the requested information.

Here are a few things you need to know:

  • If you are a dependent student (see our FAFSA Dependency Questionnaire in the resources section), one of your parents will also need to set up their own FSA ID. Parents will use the same website and follow the same steps.
  • Your email address cannot be the same as your parent’s email address on the FAFSA. Make sure you have two separate email addresses before you set up your FSA IDs.
  • Because many high schools have firewalls to prevent students from receiving external mail, it’s best not to use an email address that’s been assigned to you by your school.
  • If you have any questions about the FSA ID, click ‘Help’ in the top right corner at fsaid.ed.gov. You’ll find a wealth of information there.

Don’t forget to submit your FAFSA as soon as possible for priority consideration for some types of financial aid!

Get Ready, Get Set, FAFSA!

Oct. 1 is quickly approaching, and we all know what happens then, right? The 2018-2019 Free Application for Federal Student AID (FAFSA) opens! Take these steps now to prepare.

  1.  Create your FSA ID. The Federal Student Aid ID is a username and password used to electronically sign your FAFSA and complete other important financial aid paperwork. The student and one parent will each need their own FSA ID. Be sure to keep track of the username and password you create. You’ll use your FSA ID for years to come, so be sure to use a personal email account when creating your FSA ID. You may not always have access to your school issued email account in the future.
  2. Gather your tax information. The 2018-2019 FAFSA will request 2016 tax information. Take the time now to locate 2016 income and tax information for both the student and parent(s). The IRS Data Retrieval Tool will be available for students and parents to transfer tax information directly from the IRS into the FAFSA. However, it will still be important to have your tax documents with you when you complete the FAFSA.
  3. Think about where you’re headed. You’ll have the opportunity to send your FAFSA to up to 10 schools you’re considering attending. Keep in mind you can log back into your FAFSA to add and remove schools if your plans change. Check out OKcollegestart.org to learn more about schools that would be a good fit for you and your goals.
  4. Ask questions. If you have special circumstances that you believe impact your ability to complete the FAFSA, ask for guidance now! Ask us by clicking on “Email Us Your FAFSA Question!” on the right side of this page. You can also contact your high school counselor or the financial aid office at your college to discuss your situation.

Completing the FAFSA is an important step toward funding your education after high school. Be sure to complete the application as soon as possible after Oct. 1!

Are You Looking for Money?

When you’re investigating your financial aid options to help fund your education, always remember to go for the “free money” first. Free money is grants and scholarships that you don’t usually have to pay back.

The Pell Grant is a huge benefit for students who need help paying for school. Many factors go into deciding who is eligible for Pell grants, but three major factors are family income, household size and the number of people in the household who will be attending college. The maximum Pell grant a student can receive during the 2017-18 school year is $5,920, which is a $105 increase from last year.

If you must borrow student loans to pay for college, borrow only what you’ll need to pay your remaining expenses after the free money and college work study funds you expect to receive. For the 2017-18 school year, federal student loans will bear the following interest rates:

  • Direct Subsidized Loan (Undergraduate): 4.45%
  • Direct Unsubsidized Loan (Undergraduate): 4.45%
  • Direct Unsubsidized Loan (Graduate): 6%
  • Direct PLUS Loans (Graduate & Parents): 7%

To find out what types of federal and state aid you will be eligible to receive for college expenses, you must submit a Free Application for Federal Student Aid (FAFSA). The 2017-18 FAFSA is available now, and the FAFSA for the 2018-19 academic year will be available on Oct. 1.

For more information about the types of aid that may be available to you, visit UCanGo2.org and read our popular booklet, Are You Looking for Money?