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Student loan debt canceled sooner than expected
The Biden administration has announced it will begin forgiving student loans for borrowers sooner than expected.
Have a FAFSA anomaly? Don’t worry, experts say.
Although the new simplified Free Application for Federal Student Aid (FAFSA) got off to a late and rocky start, things are improving, they say.
More families are completing their 2024-25 forms without delay. But if you’re still concerned about whether you still have a disability or whether financial aid changes will give you enough money to attend school, there are other avenues to consider besides those related to the FAFSA.
Please note that students must fill out a form if they wish to receive federal financial aid in the form of a Pell Grant or government student loan. This form is simplified compared to past years. Financial aid experts advise all students to complete the FAFSA, even if they are unsure whether they will receive aid.
That being said, you can look for money and things you need to know here.
First, FAFSA
Experts say the FAFSA remains the top choice for securing financial assistance before pursuing alternatives.
“The reason we look at the FAFSA for financial aid is because Pell Grants and federal loans are the backbone,” said Senior Director of Data and Strategic Initiatives at the nonprofit advocacy group National College Attention Network. , said Bill DeBurn.
The U.S. Department of Education provides more than $120 billion annually in grants, work-study funds, and low-interest loans to approximately 13 million students. Federal loans also offer better consumer protections, including flexible payment options and the possibility of forgiveness.
The average aid amount for full-time equivalent undergraduate students totaled $15,480 in 2022-2023, according to the College Board, a nonprofit organization that promotes college readiness.
Bethany Hubert, financial aid specialist at Going Mary by Earnest, said the FAFSA is “the most important step in the financial aid application process and should not be skipped by students graduating from high school.” Ta. “Skipping the FAFSA could mean leaving financial aid on the table.”
What to expect: How will the FAFSA change? How that means less financial aid for some people.
What is the alternative to FAFSA?
If you’re frustrated and worried that you don’t have enough money after patiently waiting for your financial aid letter, or that you can’t even apply for the FAFSA, experts say there are some things you can consider to provide back-up. There are options.
- CSS profile: A financial aid application form that some universities use to award institutional aid.this is do not have It is an alternative to the FAFSA and by submitting a CSS profile, do not have Make a student eligible for federal or state financial aid.
- Application of alternative state aid: Some students who are ineligible for the FAFSA due to immigration status should check their state for alternative aid applications. For example, Illinois offers an alternative application for Illinois Financial Aid that is also available to undocumented students.Virginia is offering state funding to Virginians who are nonimmigrants, undocumented immigrants, have Deferred Action for Childhood Arrivals (DACA) status, or are otherwise ineligible to apply for the FAFSA and would like to be considered for state financial aid. Start an alternative state aid application.
- Scholarships and grants: Schools and private organizations offer their own scholarships and grants based on need and merit. Many, but not all, may require a FAFSA. The trick is finding them. Luckily, there are plenty of his websites to help, including Scholly, founded by Christopher Gray, who won a $1.3 million scholarship and landed a Shark Tank deal for his company. Others include Going Merry, FastWeb, and BigFuture.
- Veteran benefits: If you served in the military or have someone in your family who was in the military, you may be eligible for Veterans Education Benefits in addition to the FAFSA.
- Financial aid counselor: We can provide a wealth of information as well as help you navigate the FAFSA and school admissions processes. They also know about lesser-known scholarships and grants. They have important contacts and information available to help you find more help. “It’s never too early to start building a relationship with the Office of Financial Aid,” said Patti Koehler, vice president for financial aid at Western Governors University. “They can help you overcome and alleviate common fears and help you earn enough money to graduate.”
- Employer: Your employer may offer money for your education. The IRS allows companies to provide up to $5,250 per employee per year in educational expenses tax-free.
- Private student loans: Most experts say this option should be reserved as a last resort because you can benefit from low federal interest rates, attractive federal repayment plans, and other borrower protections. If you are considering these, you should do your research and fully understand the terms.
- Please reconsider your plans. Review your list of colleges to make sure you have a mix of schools with different price points and consider the costs and benefits of each. “I’m a strong believer in informed decisions,” said Bob Collins, senior advisor in the Office of the President and vice president for talent and finance at Western Governors University. The Department of Education’s “University Scorecard” is very important. It includes consumer information and the achievements of people who attended that university. It’s user-friendly, and if you look it up, you’ll find the average cost of attendance, the median debt for students who graduated with federal student loans, and the median income by program of study. Find out the costs of a particular institution to know what to expect. ”
You can also earn and learn. “You don’t have to leave school to go back to school,” Collins said. “You can do distance learning online.”
In the end, college may not turn out to be the most cost-effective option, and that’s okay, Collins says. There are also technical programs, practicums, and internships that don’t require a degree. Many are low-cost or can be paid for with workforce development funds or grants.
Medora Lee is USA TODAY’s money, markets and personal finance reporter. Please contact us at mjlee@usatoday.com. Subscribe to our free Daily Money newsletter for personal finance tips and business news every Monday through Friday morning.
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