Financial Aid

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When planning your college career, one of the biggest questions asked is: How am I going to pay for it?

Applying for Financial Aid

Overcoming Sticker Shock

Over the last several decades, college tuition has increased dramatically. Naturally, the sticker shock of college tuition can be a cause of concern for many students and families, but there are ways to negate the high price tag and still achieve your education goals.

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According to the College Board, the average tuition cost for full-time students (in-state) at a public, 4 year college is $9,410. For out-of-state students, that cost jumps up to $23.890. For those of you looking at a private university, the average annual cost of tuition is a whopping $32,410. Due to the rising cost of college education, applying for financial aid is of paramount importance.

1. Determine Your Financial Situation

student taking notes during meeting

The first step in figuring out what you need in terms of financial aid is having an honest look at your family’s financial situation. Are you able and willing to cover the cost of tuition?

Having a clear understanding of your financial situation and establishing realistic expectations is essential to moving forward in pursuing other forms of financial aid.

2. Know the Difference between Merit-Based and Need-Based Aid

Merit-based and need-based financial aid are two different forms of assistance available to students, and it is important to understand the differences between them.

  • Merit-based aid. This type of financial aid is based upon the achievements and academic performance of the student. The most common form of merit-based aid is scholarships that are awarded through schools or private institutions.
  • Need-based aid. This form of financial aid solely takes into account the ability of you and your family to pay the cost of college tuition. You can receive need-based financial aid through private and federal student loans and grants.

3. Find Out What Merit Can Do for You

student receiving acceptance letter from university

Merit-based financial aid is focused on your performance in school and excelling through extracurricular activities.

Your first step in figuring out what merit-based aid you may be able to obtain is to speak with your high school guidance counselor. He or she will be able to direct you to local, state, and organizational opportunities that fit your unique skills. If you are an adult learner going back to school, you can reach out to the university’s financial aid advisor for assistance.

Additionally, public and private colleges often list available merit scholarships on their websites, so it is worth taking a look! For more information on the various merit-based scholarships available, you can also check out reputable scholarship websites, such as and

4. Understand Loans, Grants, and Work-Study

Need-based financial aid comes in three main forms, and having a clear understanding of their differences is essential to make sure you are applying for the aid that best suits your circumstances.

  • Loans. Federal student loans are a common form of need-based financial aid to help students make up the difference left after any merit-based aid is applied. These loans require repayment beginning after you are no longer enrolled in college or drop below half-time enrollment.
  • Grants. Unlike student loans, grants are need-based financial aid that does not need to be repaid upon graduation. There are several federal and state grants available to students in need, and filling out the FASFA is the first step to figuring out which ones are available to you.
  • Work-Study. The federal work-study program offers part-time employment to students who demonstrate a financial need. This allows students to earn money that can be used to pay for educational expenses while working in a field that supports their studies.

    5. Complete the FAFSA

    filling out FAFSA form

    Once you have a clearer picture of the financial aid available, it is time to fill out the Free Application for Federal Student Aid (FAFSA). If you are interested in any form of need-based financial aid, this application is essential for determining your eligibility.

    Keep in mind that private institutions may have an additional form for you to fill out, so it is important to touch base with your prospective schools to inquire about their unique processes. The FAFSA website is very user-friendly, but the process will go faster if you have the following items ready when filling out your form:

    • Social security number (including your parents’ if you are a dependent student)
    • Driver’s license number, if applicable
    • Federal tax information or returns (including parents’ or spouse’s, if applicable)
    • Records of untaxed income
    • Bank account, investment, and real estate asset information

    If you want to get an early estimate of the aid you might receive, check out FAFSA’s new FAFSA4caster which can be used to help you get an early estimation of your financial aid eligibility so you can plan ahead. For those of you who like doing things on the fly, you can now download the FAFSA mobile app.

    6. Apply for a Private Loan

    Applying for merit-based and need-based federal aid is typically the first step when looking for ways to cover tuition. If you find yourself still coming up short, private student loans can be a viable option, but they do come with a price.

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    Student loans obtained through private banking institutions or schools should be a last resort for financial aid due to their higher interest rates. While federal student loans typically have fixed interest rates and do not require repayment when you are in school, the opposite is true for private loans. Additionally, private student loans are not typically eligible for forbearance, consolidation, or loan forgiveness.

    7. Watch Those Deadlines!

    Even if the fall semester seems far away, many financial aid applications have early deadlines that are essential to meet. You can check with your guidance counselor to make sure you know when applications for merit-based scholarships are due so you can avoid missing out!

    For federal financial aid, the FASFA can be filled out as early as January 1st of the year you will be attending college. You can submit your FAFSA beginning on October 1st each year. It is important to get it completed as soon as possible! The sooner you submit your application, the more money you may be eligible for when it comes to federal and state grants.

    8. Colleges Want to Help

    incoming college student looking for university online

    If you find yourself struggling with covering the high cost of college tuition, you are not alone! With the state of the economy, financial aid officials are working hard to accommodate students in all financial situations.

    To have the highest chance of receiving the money you need, it is best to start early! You can contact your prospective colleges to find out their policies on financial aid and visit their websites for helpful information. In addition, a number of colleges offer payment plans to help students manage the cost of their education without going into debt. Here’s a list of almost 250 online colleges offering monthly payment plans to their students.

    9. Don’t Be Afraid to Appeal an Offer

    Despite all of your efforts, you may find yourself receiving less aid than you had hoped. If this happens to you, don’t panic! Financial aid officials understand the hardships that tuition can cause, and it may be helpful to appeal directly to your college for assistance.

    By explaining your situation and asking for a review of the aid offered, some schools may be willing to make an adjustment to their financial aid formula on a case-by-case basis.

    10. Don’t Base Your Choice on Finances Alone

    students choosing which university to apply

    There are many factors that go into choosing a college that is right for you. Not only should it cover your desired course of study, but it also needs to be a match for your lifestyle and financial situation.

    Do you have a full-time job, and are you not sure how you can juggle school and the rest of your responsibilities? You can compare traditional and online college courses to see which is a better fit. You can also check out our list of the most respected online universities.

    Ultimately, you want to choose the university that’s the best fit for you and your long-term goals. A college education is one of the best investments you can make for your future. Sometimes, all it takes is thorough college finance planning to make it work.

    Applying to college is a big step toward your future, and it is a given that your educational journey may come with a high price tag. That doesn’t mean there aren’t options! With the assistance of scholarships, loans, and grants, it is possible to achieve your goals without breaking the bank.

    Ready to start your journey?
    Elizabeth Abner
    WRITTEN BY Elizabeth Abner

    Elizabeth is pursuing a Doctor of Philosophy in Foreign Policy and earned her master's degree in business administration. For her undergraduate studies, she earned a Bachelor of Arts in Business Administration with a concentration in international business. Elizabeth's research is focused on universities offering online degree programs.