Figuring out Financial Aid

by Timothy Harper

First the bad news: college costs are going through the roof. Now the good news: thanks to an increase in the amount of financial aid offered by colleges and universities, most students don't pay full fare. Keep in mind, though, that most financial aid is given in the form of loans that must be repaid.

The way to maximize your chance of getting maximum aid is to start planning early.

Start Early

An early start gives a child an advantage in competition for the many merit-based and specially targeted scholarships that are available. Millions of dollars are awarded to outstanding athletes, musicians and others who demonstrate accomplishments. Residence or family membership in particular organizations can make a child eligible for targeted assistance.

Admission to college and qualification for aid depend on taking the right secondary school courses and studying diligently. Evidence of extracurricular activities, leadership, community service and summer job experience also help. By taking standardized tests early, students have time to take them again if necessary.

A child should ask his guidance counselor to recommend the high school course of study most likely to win college admission and aid. Visit campuses and admissions offices no later than 11th grade to learn about the schools and what they're looking for in applicants, and to make early impressions on the college decision makers.

Kinds of Aid

Nearly 70 percent of aid to American students is awarded by the U.S. Education Department, and other federal agencies pass out more. As a result, every financial aid applicant should fill out the Free Application for Federal Student Aid. Many colleges accept that application for their own aid programs as well, but others also require a form called the Financial Aid Profile (formerly known as the Financial Aid Form).

Aid comes in grants, loans, tax credits, jobs and as reward for performing military or community service. Many middle-class families qualify for some need-based aid. Merit scholarships aren't based on need. And anyone with an acceptable credit record can obtain a loan, some of which come with the benefit of deferred payments.

Timeline

The federal aid application cannot be filed until after January 1 and must be received by June 30. Colleges and aid-awarding institutions establish varying application deadlines for their own assistance programs, including federal aid that they administer. In his book, "USA Today's Financial Aid for College," education writer Pat Ordovensky recommends filling out the federal form between Christmas and New Year's and mailing it on January 2. There's advantage to being the early bird, he says. If you don't have all the information you need then, you can amend the form later.

Resources

Keep in mind that your child's high school counselor may be one of your best first sources for information about financial aid. Also, state education agencies can tell you about assistance at state campuses and special aid available to state residents. If you come up short with these, you could also try college aid offices, unions, professional associations, community organizations, and religious institutions.