Need-based financial aid may include grants that you don’t have to repay, work-study employment to help defer college costs, and subsidized loans, which come with friendly repayment terms.
Here’s what it is and how to get need-based financial assistance, kindly study our content carefully.
What is Need-Based Financial Aid?
Need-based aid is a type of financial aid available to students whose parents do not have enough money to pay for college.
Students who are self-sufficient may be eligible for need-based aid if they are unemployed or have few assets.
To be eligible for need-based aid, you must complete the Free Application for Federal Student Aid (FAFSA) (FAFSA).
The FAFSA requests financial information about you and your families, such as income and assets, in order to determine your eligibility for need-based aid.
To be eligible for need-based aid, students must complete the FAFSA every year. Students may receive more or less need-based aid than the previous year if their family’s financial circumstances have changed.
If your parents divorce during your freshman year of college, for example, you may be eligible for more need-based aid during your sophomore year.
Types of Need-based Financial Aid
There are several types of need-based assistance, including:
Grants are available to undergraduates with exceptional financial needs.
How much you get is based on your expected family contribution as calculated by the Free Application for Federal Student Aid or FAFSA; your enrollment status (full-time vs. part-time) and your school’s cost of attendance.
The maximum Pell Grant for the 2020-2021 school year is $6,345.
These part-time jobs are available both on- and off-campus for graduate, professional and undergraduate students at schools participating in the Federal Work-Study Program.
You’ll earn at least the federal minimum wage and usually get paid directly as opposed to having the funds directly applied to tuition.
Federal Student Loans
There are two types of federal student loans: unsubsidized and subsidized. Subsidized loans are given only to students who qualify for need-based aid.
Interest on a subsidized loan does not accrue while the student is enrolled at least part-time, during the six-month grace period after the student leaves school, and during any deferment periods.
Subsidized loans are available for both undergraduate and graduate students.
The maximum annual amount for undergraduate students ranges from $3,500 to $5,500, and the aggregate limit for all undergraduate subsidized student loans is $23,000.
The aggregate limit for subsidized loans for graduate students is $65,500.
While many scholarships are granted to students based on academic or athletic merit, some are available only for students with demonstrated financial need.
Your college may have specific scholarships and grants for such students. Contact the financial aid department and ask if there are any scholarships you can apply for.
You can also search for need-based scholarships from third-party providers on sites such as Scholarships.com, Bold.org, and Fastweb.com.
How to Qualify for Need-Based Financial Aid for College
If you’re looking to get money for school, you can qualify for need-based financial aid by first completing the FAFSA.
The FAFSA is your first step in detailing your family’s financial information. The Department of Education uses this application to determine your expected family contribution or EFC.
Be mindful that even if you qualify for need-based financial aid, you might not receive enough to cover college costs.
Many free need-based options are awarded on a first-come, first-served basis.
This means you’ll want to complete the FAFSA as soon as you’re able. You can submit your FAFSA as early as Oct. 1 for the following school year.
That means for students entering school in the fall of 2021, you can submit your FAFSA starting Oct. 1, 2020.
If you’re looking for money to pay for college, the financial situation of your family will play a significant role in determining how much need-based financial aid you can receive.
While you may require financial aid to cover your entire cost of attendance, you may not always receive it. Fill out your FAFSA as soon as possible to maximize your return.
Fill out applications and, if necessary, find references to speak on your behalf. Get as much free money as you can before taking out loans that you’ll have to pay back after you graduate.
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