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For decades now, the cost of a college education has been rising at twice the rate of inflation.

And while many parents are scrambling to pay for tuition, an alarming number of low-income students are missing out on federal money – because they simply never apply.

Dwayne Brown, however, took advantage of that available aid. He wanted to go to college, but didn’t know how to pay for it.

“Yes I worried about that, right when I got my first acceptance letter,” says Dwayne, who is now a senior at Georgia State University.

His guidance counselor helped him apply for a Pell Grant– which gives up to $4,050 a year to needy college students.

“If you want to get any kind of government assistance, you have to fill out this form,” says Dwayne, “and it takes no more than 30 minutes to fill it out.”

He says it was easy, and in the end, he had a Pell Grant.

But according to the American Council on Education, one and a half million students miss out on federal Pell Grants – simply because they do not apply.

“It means that some students might self-select out of colleges, because they don’t think they’ll be able to afford it,” says Julia Padgett, the financial aid director at Emory University.

She says other students, who don’t know about the grants, take out loans and go further into debt.

“Or maybe they take a few classes and they are trying to work at the same time,” says Padgett. “We see a lot of that.”

She says you apply for a Pell Grant online – by filling out the “Free Application for Federal Student Aid,” or “FAFSA.”

“So if a student fills out the FAFSA, and they are Pell-eligible, the aid office will also determine if they are eligible for any other federal grant programs, for the work-study program, for federal loans,” says Padgett. “They do not have to apply specifically for each type of aid.”

Besides the Pell Grant, Dwayne also qualified for federal loans and the work-study program.

“It financed my education, and that’s the biggest thing,” says Dwayne. “I do not know how I would have got through college. It might have taken me longer. It might have taken me – instead of four years, it might have taken me maybe six or seven years, because I would have had to work and do part time.”

What We Need To Know

• Students who are interested in receiving any type of federal financial aid for their college education should fill out a Free Application for Federal Student Aid. You can find that application at http://www.fafsa.ed.gov. Federal financial aid administrators will automatically consider the student for every type of federal assistance available. (U.S. Department of Education)
• Students who fill out the FAFSA will need their social security number, driver’s license, income tax return, bank statements and investment records. In many cases the student will also need that information, as well, from both parents. (U.S. Department of Education)
• To be eligible for financial aid a student must be a U.S. Citizen, have a high school diploma or GED, and be accepted to a school that participates in the federal financial aid program. Also, the student must not have defaulted on a previous federal student loan or have certain drug convictions. (U.S. Department of Education)
• If a student is applying to more than one college, the student does not need to fill out a separate “FAFSA” for each school. Instead, there is a space on the application where the student can write down every school that needs access to the information. (Julia Padgett, Director of Financial Aid, Emory University)
• If a student wishes to receive federal funding for the 2006-2007 school year, they must submit the FAFSA by midnight Central time, June 30, 2006. (U.S. Department of Education)
• Many colleges and universities use their own money, to provide needy students with financial aid. The student should check with the financial aid office at each university to find out how to apply. Many schools will have a single form that will determine a student’s eligibility for every type of assistance offered by the institution. Many schools also use an application form called the “Profile”, which is put out by the College Board. You can find it at https://profileonline.collegeboard.com/index.jsp. (Julia Padgett, Director of Financial Aid, Emory University)
• The only reliable way to know if a student is eligible for financial aid is to apply. The formula is complicated, and many factors are taken into consideration besides income. (Julia Padgett, Director of Financial Aid, Emory University)
• Scholarships can be a great source of “free money” for a college education. Before investing time in seeking out scholarships, parents and students should develop a plan. Research local scholarships first. The smaller the geographical area, the better your chances of winning. Also, parents may have the inside track on scholarships offered by their employers or churches. And don’t overlook your child’s employer. Many fast food chains, department stores, and supermarkets offer scholarships. (The College Board)
• “The Scholarship Search” is a tool put out by the College Board that collects information on hundreds of scholarships and awards. Based on your answers to a questionnaire, you will receive information on scholarships that might be right for you. There are several good scholarship search services. A reputable service should be free. If you are asked to pay a fee for exclusive scholarship leads, you may be dealing with a scam artist. (The College Board)
• According to the Federal Trade Commission, the following lines are telltale signs that a would-be scholarship is a scam.
• “This scholarship is guaranteed or your money back”
• “I just need your credit card or bank account number to hold this scholarship.”
• “We’ll do all the work.”
• “The scholarship will cost some money.”
• “You’re a finalist” – in a contest you never entered.

Resources

• Free Application for Federal Student Aid
• Federal Student Aid, division of the U.S. Department of Education
• The College Board

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