ASK KIM


Worthwhile to Apply for Financial Aid

Kimberly Lankford

You might qualify for funding to help pay college bills -- even if you think your income is too high.



My daughter will be starting college next year, and we already spent many hours filling out applications. I know that financial aid forms are due soon, too, but we're wondering whether it's really worthwhile to submit those forms -- I really don't think we'll qualify for any need-based aid, although it would be nice if we did!

It's definitely worthwhile to submit the financial aid forms. Almost $135 billion in financial aid was distributed in the 2005–2006 school year, according to the College Board. Full-time students, on average, received $5,144 each in federal loans and $4,433 in grants.

Some pricey private schools give out more money than you might expect. For example, 93% of students at Princeton in the class of 2008 who applied for financial aid and whose families earned between $120,000 and $139,999 a year were eligible for aid. The average grant was $14,000 (grants are higher for families who earn less). And two-thirds of the undergraduates at Harvard receive some form of financial aid, with half receiving need-based Harvard scholarship aid. One-fifth of the families receiving need-based scholarships from Harvard have family incomes of more than $130,000. And Harvard is among a growing number of schools that now meet the full need -- through grants and work-study -- for families earning about $60,000 or less. See Special Deals on College Tuition for more information about several of these programs.

To see if you're likely to qualify for need-based aid, run your numbers through the expected family contribution calculator at Finaid.org (which is also filled with a lot of great financial aid resources). You'll get an estimate of how much your family will be expected to pay for college expenses. But even if aid doesn't look likely, it's still worth the effort to fill out the forms, which are often a starting point for merit-based aid, too.

Also find out if your state offers money for students with high grade-point averages or standardized test scores. Georgia residents who earn at least a 3.0 grade-point average in high school and college qualify for free tuition at Georgia state colleges or a $3,000 discount at private schools in the state. Louisiana, Massachusetts, Nevada, New Mexico and several other states offer sizable scholarships to residents who attend state colleges and had good high school grades or scores -- regardless of financial need, but you may need to submit the Free Application for Federal Student Aid (FAFSA) to apply. For more information about the FAFSA, see the U.S. Department of Education's Student Aid Web site.

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Now is the perfect time to apply for financial aid because some schools award aid on a first-come first-served basis, even though their aid application deadlines may not be until February or March or later. It's best to submit them as early in January as possible. Don't worry if you haven't filed your taxes yet -- you can estimate the information now (you should have most of the information from your December pay stub and year-end statements) and then can make revisions on your student aid report after you complete your tax return. For more information about applying for financial aid, see Early Birds Grab the Financial Aid.

Got a question? Ask Kim at askkim@kiplinger.com.




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