Nearly 75 percent of private college students receive financial aid and 60 percent of public college students get loans, grants and scholarships, according to CNN Money. Statistics like these encourage parents to see what help is available for their children. The federal government distributes most of the grants and loan guarantees to encourage college attendance and improve the lives and education of the American public.
Types
Financial aid may be in the form of grants, scholarships, loans and loan guarantees, but grants are a large share of the aid offered in 2010. Some students who do well in college do not qualify for scholarships; likewise, some students who qualify for scholarships cannot get grants because family income is too high. The Pell Grant is the best-known federal grant for college students, and it is need-based.
Action
Students who are seniors in high school should complete the Free Application for Federal Student Aid as early as possible. The FAFSA is the entry form to most of the federal and state grant money, including the Pell Grant. Many colleges use this form for distribution of private funds as well. About four weeks after the FAFSA is completed, the student will receive a Student Aid Report listing the expected family contribution (EFC) figure that determines grant qualification and ultimately, the amount of grant entitlement.
Considerations
Family income and resources, including the number of dependents and other children in college, determine the EFC figure. The U.S. Department of Education uses a formula for calculation. It considers the status of the student --- dependent, independent or independent with dependents. The formula also includes the cost of education, since some colleges are more expensive. The Pell Grant program pays a maximum of $5,550 in 2010 in grant money, or $2,775 each semester for a full-time student, so this covers a smaller percentage of expenses for private colleges.
Significance
Once the student completes the FAFSA and receives the EFC figures, parents can review the result and develop a plan for college funding. Grants do not provide total college funding. Students often combine grants, loans and part-time employment to complete college with the least debt possible.
Warning
Students must complete the coursework for one semester to be entitled to grant funding for the following semester, and must complete a new FAFSA each spring for additional grant money. The year runs from July 1 to June 30 for Pell Grants and most federal grant money. FAFSA completion has a June 30 deadline, but early applicants often get funding that others do not. As with most free money, it may go faster than expected.
Tags: grant money, college students, Pell Grant, college funding, federal grant, grants scholarships, loan guarantees