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Cool Stuff About Business and Entertainment in the Greater Harrisburg, PA Area. |
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Cool Stuff About Business and Entertainment in the Greater Harrisburg, PA Area. |
Paying For Your Education: by Jo Sheppard Thinking of entering business school or returning to college? Perhaps you’ve always wanted to be a nurse or a chef but lack the professional preparation. Think a college education is out of reach? Well, think again. College financing is available … if you know where to look. MODE talked to a number of post-secondary education institutions in the greater Harrisburg area to learn the facts about financial aid. What we learned may surprise you. According to local financial aid directors, including Chip Woodward of the Central Penn College, financial aid is in reach of every student — the key is what type of financial aid you are seeking. Woodward admitted that not every would-be student is eligible for grants but he does believe all students are eligible for loans and other funding sources. Granted, no one wants to have to repay loans but if you look at education as an investment in your future, the loans will prove worthwhile. Woodward adds, “It doesn’t hurt to apply. The sooner you apply, the more options you will have available. Financial aid is out there. You just have to pursue it.” Woodward does caution, however, that many students do not receive financial aid because they fail to complete the required forms, do not include all required documents, or miss the application deadlines. If you aren’t sure how or when to apply, contact the Financial Aid office at your chosen institution. They will be happy to counsel you about your financial aid options and will guide you through the application process.
The type of educational institution or program you elect to pursue will also effect the type of funding available. Most funders require that you enroll in a degree-oriented program at an accredited institution (accreditation is earned by compliance with strict state or federal educational guidelines). Keep in mind, however, that even if you do not complete the educational program, financial aid loans must still be repaid. You are legally obligated to repay loans even if you withdrawal from the program or are involuntarily removed due to poor grades or misconduct. In addition, many financial aid sources require that you earn a minimum grade point average to continue receiving aid in subsequent semesters, quarters, or terms. I talked to Kristen Bilous, a local student who just completed her freshman year at the University of North Carolina at Wilmington and she described her college funding package. She receives financial assistance from her parents, was awarded a small grant from the University, borrowed some funds through student loans, and in the fall, will enter the work-study program at the University. In addition, Bilous has spent her summer waitressing and working as a sales clerk to contribute to her college fund. Bilous always planned to attend college, but as tuition prices rose, and with a brother also in college, she knew she would have to help with the expense. Selecting an out-of-state institution meant she pays a higher tuition rate as well. But Bilous says she loves her school and knows that her investment will pay off when she begins her career. Stories like Bilous’s are typical. Eighty-five percent of the students who attend Academy of Arts and Business receive some type of financial aid, according to Gary Kay, Academy President. Many students receive a combination of Federal Pell grants, student loans, and state grants. In addition, the Academy offers its own scholarships. Each year high school seniors compete for 50 percent tuition scholarships for each of the Academy’s six 15-month programs. Academy students may also qualify for academic assistance through SETCO or the Office of Vocational Rehabilitation (OVR). Kay confirmed that financial aid is readily available for anybody who wants to attend an educational program. “There are Federal and State loans and grants available for most people. Those who feel they cannot afford an education are many times the ones who qualify.” He added that the Academy’s financial aid counselors work closely with student applicants to determine their eligibility and design an appropriate aid package. In fact, many students actually receive approval for financial aid within seven days of their initial inquiry into the Academy programs. Kay assures that it’s never too late to apply for aid, especially at a smaller institution like the Academy where immediate assistance is guaranteed. Eighty percent of the students who attend Harrisburg Area Community College (HACC) work 20 to 40 hours per week while attending classes. HACC President Dr. Edna V. Baehre confirmed that thirty-five percent of the school’s students receive some form of campus-based aid (Federal Work Study, Perkins, and Supplemental Educational Opportunity Grant). HACC students tend to be non-traditional with a large number of older students (HACC’s average student age is 28); and most are returning to college after beginning careers. Some students who are also full-time employees receive tuition reimbursement as a company benefit. Area employers who do offer tuition reimbursement set their own policies regarding this type of benefit. Most require that the coursework be in job-related areas and that the students achieve a minimum grade. Some reimburse on a graduated level with an A-grade resulting in complete reimbursement, a B at eighty percent, and a C at sixty percent. Most do not provide any reimbursement for grades that are less than a C. Some employers will even include the costs of books in the tuition reimbursement. Check with your employer’s benefits office to determine if this type of funding is available. Note that most employers who do offer tuition funding assistance have a maximum reimbursement rate per employee per year, so be sure to check the guidelines carefully. The Department of Defense also offers tuition incentives for in return for military service. All branches of the military offer some form of tuition funding. The Navy offers several types of aid, such as the Montgomery G.I. Bill, a program for non-prior service enlistees who enroll in the Navy. Enrollees in the Montgomery G.I. Bill program agree to a $100 per month reduction in their pay for 12 months in return for a total educational benefit of $15,400. The Navy College Fund offers a maximum of $30,000 ($15,400 through the Montgomery G.I. Bill and $14,600 through the Navy College Fund) in educational benefits for those enlisting in critical or hard-to-fill jobs. The Navy also pays 75 percent of the cost of college courses with a maximum of up to $2,500 per year for undergraduate courses and $3,500 a year for graduate level courses. Another option that exists for potential students is the Pennsylvania Tuition Account Program (TAP). TAP is a government program that, according to the website, “provides a safe and affective way … to lock in the cost of tomorrow’s tuition at today’s lower prices.” While many people are aware of TAP on the premise that it is used for the benefit of a child’s future, it became obvious when talking to Bob Gentzel, Director of Communications, that the program can also be used to fund the education of anyone — including adult students. “It’s really very situated for an adult planning to go back to college,” Gentzel notes, “It’s a good way to set aside money to be able to go.” While Gentzel emphasized the fact that the money must be in the account for a year before use, he added that that factor should not deter the interested student — in fact, it could help them in building their funds. “TAP is an excellent way to begin building the funds you will need,” he says, adding, “with TAP you are able to lock into the current tuition price — it’s an excellent way to beat tuition inflation.” With TAP credits — which are applicable at participating State related or State System Higher Education Universities as well as some community colleges and accredited colleges, and whose price per credit varies per institution —a perspective student can fund a complete education at one time, or on a continuing basis. “There are no required monthly payments,” Gentzel is quick to point out, noting, “For people who are planning ahead, TAP is an excellent vehicle.” While TAP may not be “financial aid” in the sense that funds are given to you, it is certainly a program worth looking into. There are no strings attached, your money can be refunded at any time for any reason, and, more importantly, you’re using your money to buy an education for tomorrow at today’s prices. What an investment! Hopefully, now you’ll have a better idea of the financial aid packages available. They may not be easy, but they’re out there — take advantage of them! Financial Aid Sources Campus-based Aid Campus-based financial aid programs are administered by the university. The federal government provides the university with a fixed annual allocation, which is awarded by the financial aid administrator to deserving students. Such programs include the Perkins Loan, Supplemental Education Opportunity Grant, and Federal Work-Study. Note that there is no guarantee that every eligible student will receive financial aid through these programs, because the awards are made from a fixed pool of money. This is a key difference between the campus-based loan programs and the Direct Lending Program. Endowment Funds Endowment Funds owned by an institution and invested to produce income to support the operation of the institution. Many educational institutions use a portion of their endowment income for financial aid. A school with a larger ratio of endowment per student is more likely to give larger financial aid packages. Federal Direct Student Loan Program The Federal Direct Student Loan Program (FDSLP) is similar to the Federal Family Education Loan Program (FFELP). The funds for these loans are provided by the US government directly to students and their parents through their schools. Benefits of the program include a faster turn-around time and less bureaucracy than the old “bank loan” program. The Federal Direct Student Loan Program (FDSLP) includes the Federal Direct Stafford Loan (Subsidized and Unsubsidized) and the Federal Direct Parent Loan for Undergraduate Students (PLUS). Federal Family Education Loan Program The Federal Family Education Loan Program (FFELP) includes the Federal Stafford Loan (Subsidized and Unsubsidized), the Federal Perkins Loan, and the Parent Loan for Undergraduate Students (PLUS). The funds for these loans are provided by private lenders, such as banks, credit unions, and savings & loan associations. These loans are guaranteed against default by the federal government. Federal Work-Study The Federal Work-Study (FWS) program provides undergraduate and graduate students with part-timeemployment during the school year. The federal government pays a portion of the student’s salary, making it cheaper for departments and businesses to hire the student. For this reason, work-study students often find it easier to get a part-time job. Eligibility for FWS is based on need. Money earned from a FWS job is not counted as income for the prior year’s need analysis process. Guaranteed Student Loan The Guaranteed Student Loan (GSL) is the old name for the subsidized Stafford Loan. A guaranteed loan is a loan that is insured against default. In the case of guaranteed student loans, the Federal government agrees to repay the loans in case of default. Each loan is charged a guarantee fee to cover the costs of defaulted loans. Fellowship A form of financial aid given to graduate students to help support their education. Some fellowships include a tuition waiver or a payment to the university in place of tuition. Most fellowships include a stipend to cover reasonable living expenses (for example, just above the poverty line). Fellowships are a form of gift aid and do not have to be repaid. Merit-based Financial Aid Aid that is merit-based depends on your academic, artistic, or athletic merit, or some other criteria, and does not depend on the existence of financial need. National Service Trust The National Service Trust is Clinton’s national community service program. If a student participates in this program before attending school, the funds may be used to pay their educational expenses. If the student participates after graduating, the funds may be used to repay their federal student loans. Eligible types of community service include education, human services, the environment, and public safety. Need-Based Financial Aid Aid that is need-based depends on your financial situation. Most government sources of financial aid are need-based. Other Resource A resource is something that is available because a student is in school and is counted after need is determined. Outside scholarships, prepaid tuition plans, and VA educational benefits are examples of other resources. Pell Grant The Pell grant is a federal grant that provides funds based on the student’s financial need. Perkins Loan Formerly the National Direct Student Loan Program, the Perkins Loan allows students to borrow up to $3,000/year (5-year max) for undergraduate school and $5,000/year for graduate school (6-year max). The Perkins Loan has one of the lowest interest rates and is awarded to students with exceptional financial need. The student must have applied for a Pell Grant to be eligible. The interest on the Perkins Loan is subsidized while the student is in school. Parent Loans for Undergraduate Students Parent Loans for Undergraduate Students (PLUS) are federal loans available to parents of dependent undergraduate students to help finance the child’s education. Parents may borrow up to the full cost of their children’s education less the amount of any other financial aid received. PLUS Loans may be used to pay the EFC. There is a minimal credit check required for the PLUS loan, so a good credit history is required. Students are advised to check with their local bank to see if they participate in the PLUS loan program. If the application for a PLUS loan is turned down, the student may be eligible to borrow additional money under the Unsubsidized Stafford Loan program. Renewable Scholarships A renewable scholarship is a scholarship that is awarded for more than one year. Usually the student must maintain certain academic standards to be eligible for subsequent years of the award. Some renewable scholarships will require the student to reapply for the scholarship each year; others will just require a report on the student’s progress to a degree. Research Assistantship A form of financial aid awarded to graduate students to help support their education. Research assistantships usually provide the graduate student with a waiver of all or part of tuition, plus a small stipend for living expenses. As the name implies, an RA is required to perform research duties. Sometimes these duties are strongly tied to the student’s eventual thesis topic. Loan A loan is a type of financial aid that must be repaid, with interest. The federal student loan programs (Federal Family Education Loan Program and Federal Direct Student Loan Program) are a good method of financing the costs of your college education. These loans are better than most consumer loans because they have lower interest rates and do not require a credit check or collateral. The Stafford Loans and Perkins Loans also provide a variety of deferment options and extended repayment terms. Scholarship A scholarship is a form of financial aid given to students to help pay for their education. Most scholarships are restricted to paying all or part of tuition expenses, though some scholarships also cover room and board. Scholarships are a form of gift aid and do not have to be repaid. Many scholarships are restricted to students in specific courses of study or with academic, athletic, or artistic talent. Self Help Aid Self help aid is financial aid in the form of loans and student employment. Stafford Loans Stafford Loans are federal loans that come in two forms, subsidized and unsubsidized. Subsidized loans are based on need; unsubsidized loans are not. The interest on the subsidized Stafford Loan is paid by the federal government while the student is in school and during the 6-month grace period. The Subsidized Stafford Loan was formerly known as the Guaranteed Student Loan (GSL). The Unsubsidized Stafford Loan may be used to pay the EFC. Undergraduates may borrow up to $23,000 ($2,625 during the freshman year; $3,500 during the sophomore year; and $5,500 during the third, fourth, and fifth years) and graduate students up to $65,500 including any undergraduate Stafford loans ($8,500 per year). These limits are for subsidized and unsubsidized loans combined. The difference between the subsidized loan amount and the limit may be borrowed by the student as an unsubsidized loan. Higher unsubsidized Stafford loan limits are available to independent students, dependent students whose parents were unable to obtain a PLUS Loan, and graduate/professional students. Undergraduates may borrow up to $46,000 ($6,625 during the freshman year, $7,500 during the sophomore year, and $10,500 during each subsequent year) and graduate students up to $138,500 including any undergraduate Stafford loans ($18,500 per year). These limits are for subsidized and unsubsidized loans combined. The amounts of any subsidized loans are still subject to the lower limits. State Student Incentive Grants The State Student Incentive Grants (SSIG) program is a state-run financial aid program for state residents. The states receive matching funds from the Federal government to help them fund the program. Student Loan Marketing Association (Sallie Mae) Sallie Mae, formerly known as the Student Loan Marketing Association (SLMA), is the nation’s largest secondary market and holds approximately one third of all educational loans. Subsidized Loan With a subsidized loan, such as the Perkins Loan or the Subsidized Stafford Loan, the government pays the interest on the loan while the student is in school, during the six-month grace period, and during any deferment periods. Subsidized loans are awarded based on financial need and may not be used to finance the family contribution. Supplemental Educational Opportunity Grant The Supplemental Educational Opportunity Grant (SEOG) is a federal grant program for undergraduate students with exceptional need. SEOG grants are awarded by the school’s financial aid office, and provide up to $4,000 per year. To qualify, a student must also be a recipient of a Pell Grant. Teaching Assistantship A form of financial aid awarded to graduate students to help support their education. Teaching assistantships usually provide the graduate student with a waiver of all or part of tuition, plus a small stipend for living expenses. As the name implies, a TA is required to perform teaching-related duties. Unsubsidized Loan An unsubsidized loan is a loan for which the government does not pay the interest. The borrower is responsible for the interest on an unsubsidized loan from the date the loan is disbursed, even while the student is still in school. Students may avoid paying the interest while they are in school by capitalizing the interest, which increases the loan amount. Unsubsidized loans are not based on financial need and may be used to finance the family contribution.
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There
are as many types of financial aid as there are institutions. Some forms are scholarships
which may be based on merit or need, grants which require no repayment, work-study
programs which pay students for working on campus (work-study or assistantships), and
loans which require repayment — with or without interest — once you have
completed or terminated your studies. The typical financial aid package consists of more
than one type of aid, including grants and loans. Your financial picture or that of your
parents may effect your eligibility for some of the sources. The list at the end of this
article identifies the most popular financial aid sources.