July 16, 2007
6 Myths about Financial Aid
The Kansas City Star has a great article detailing the 6 top myths about financial aid. Here are the myths tackled with links to the web pages:
Myth No. 1 – Financial aid comes only in the form of grants and scholarships.
Not true! Click on the above link to learn more about the Stafford Loan and how it can really help.
Myth No. 2 -The value of my retirement funds and my home will prevent me from getting need-based aid.
Retirement plans are excluded from Federal calculations of what you can afford – so is the house you live in. The government also “shelters” a certain amount of your income, to allow you to save for retirement. Some private companies do calculate things a little differently, though – read the full text to learn more.
Myth No. 3 – I should choose a lender from the list of “preferred” lending companies recommended by my college financial aid office.
Shopping around is probably a good idea – compare borrower benefits and read the fine print carefully. Many are dependent on not missing payments!
Myth No. 4 – I’m doomed: I’ll have two kids in college at the same time.
Actually, you won’t be expected to may more. Your Expected Family Contribution (often referred to as the EFC) is the same no matter how many kids are in college. You’ll actually like qualify for more aid.
Myth No. 5 – The federal aid process is bound by a strict formula, and it’s virtually impossible to eke any special consideration out of college administrators.
No – if you have special circumstances like a job loss it’s definitely worth calling and asking fora Professional Judgment Review and backing up your claim with documentation in your letter.
Myth No. 6 – The 529 college savings plan offered by my state is bound to be the best for me.
Maybe, maybe not. Take a look at the discounts for in-state residents, but also be careful of the fees!