Top 5 Mistakes Students Make with Financial Aid
How to avoid falling into common traps when paying for college.
Figuring out how you’re going to be paying for college can be a real challenge, especially with everything else you have to do your senior year of high school. From filling out college aid forms and seeking out federal grants and college scholarships to comparing tuition costs and deciphering your financial aid award letters, paying for college can take up a lot of your time during your senior year and after you start your college degree.
How do you make sure you have enough to cover your college tuition? Read on for tips on how to avoid making common financial aid mistakes students make when planning for college.
- Mistake: Turning in your Free Application for Student Aid (FAFSA) form too late.
How to avoid: Send in your FAFSA as soon after January 1 as you can. Technically, you have between January 1 and June 30 to submit your FAFSA form. However, some schools may have earlier due dates, so contact each school’s admissions or financial aid office to find out when forms are due. Also, be aware that some financial aid is paid on a first-come, first-serve basis, so the later you submit yours, the less college money there is available.
- Mistake: Missing out on college scholarships and other possible financial aid.
How to avoid: You may already known about the main federal grants awarded for the pursuit of higher education, but many students miss out on a lot of college money by not pursuing every college scholarship available to them. Scholarships aren’t just awarded for academic excellence; you can earn a scholarship for a special skill, association affiliation or even through your parents’ employers. Talk to your guidance counselor, college admissions offices, your employer, your parents’ employers and any professional and social organizations you belong to see what college money is out there.
- Mistake: Accepting all the loans offered in your award letter without assessing your actual need.
How to avoid: The financial aid offered by colleges and universities to help pay for college tuition usually consists of grants, scholarships and college loans. Free grants and scholarships do not have to be paid back, so you should accept those without question. But college loans do need to be paid back. Before you accept these loans, think of ways you can lower your budget so you don’t need them. Or, compare student loans to get a financial aid package with low interest rates. Remember, you don’t have to accept all the aid offered to you. After you receive your award letter and decide on a school, you got back to the college to let them know what you’ve decided to accept.
- Mistake: Not reading or understanding the fine print on college loans.
How to avoid: Do the math to see how much money you’ll need to pay back on each loan. Look at each loan’s interest rates and repayment policies, as well as when you’re expected to start paying and what the penalties are for non-payment.
- Mistake: Assuming your financial aid package will be the same each year of college or if you transfer schools.
How to avoid: Contact the admissions or financial aid offices of the schools you’re considering to ask how your financial aid allotment will change after your freshman year. And if you do plan to transfer to a different school, contact the new school to find out how much of your financial aid you can expect to transfer with you.
College Financial Aid Tips & Tactics
- Headed back to college after an absence? Read up on education grants and tax credits, as these are likely to have changed since the last time you pursued a college degree.
- When you’re pursuing grants and scholarships, don’t just focus on your unique skills and skip the obvious. There are grants for women and scholarships awarded by religious organizations, social clubs and major corporations. Some require a specific skill or background, but others are run like contests, where the prize money is awarded for the best essay or project submitted.
- When you’re considering accepting loans, be sure you’re realistic. Entry-level salaries in many fields aren’t high, and you can’t necessarily assume you’ll achieve your career goals, and dream salary, your first years out of college. Look at salary calculators and job listings to see what you can realistically expect to make in the career fields you’re interested in, and be sure to keep that in consideration when you’re accepting loans.
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