Free money for college sounds far-fetched, yet every year students across the country leave financial aid sitting on the table. In fact, an estimated $24 billion in financial aid, including grants that don’t have to be paid back, goes unclaimed every year, according to Form Your Future, which is sponsored by the National College Access Network (NCAN). Here are tips for finding the free money.
FAFSA is key to free money
The free money available to students includes grants, scholarships and other financial aid that doesn’t have to be paid back. Why does that matter? Paying back student loans is a big financial burden for a lot of Americans. Nearly 44 million Americans owe almost $1.6 trillion in combined student loan debt, and many end up defaulting on their loans, damaging their credit in the process (this guy, though, paid off more than $46,000 in student loans in just two years).
In order to tap free funding, students or parents need to fill out the FAFSA, or Free Application for Federal Student Aid. FAFSA is the critical component so many current and prospective students miss when searching for money for college. It’s available for both undergraduate and graduate school and completing the form is entirely free.
Why does the free money go unclaimed?
NCAN estimates that more than 10,000 fewer FAFSAs were completed through June of 2019 compared to 2018. According to NCAN, 61.2% of high school graduates completed a FAFSA, but only 57% of high school seniors in general, a decrease of 0.4% compared to last year.
The statistics vary by location, with Louisiana having the highest completion rate at 78.7% of seniors. Tennessee (77.8%), Delaware (68.2%), Washington, D.C., (67.9%) and New Jersey (66.6%) were also in the top five in terms of FAFSA completion.
However, 11 states and Washington, D.C., had fewer FAFSA completions this year by 3% or more. And 11 states saw fewer than 50% of their high school seniors fill out a FAFSA. Colorado, Washington, Arizona, Utah and Alaska had the lowest percentages of FAFSA completion.
How to apply for FAFSA
Current and prospective college students who don’t want to miss out can start with an Early Aid Estimate.
The FAFSA4caster is especially good for those who aren’t yet ready to file a real FAFSA, such as high school juniors. The tool allows students and parents to input their financial data and get an estimate of how much free money they might get for college.
Those who are ready for the FAFSA go through a similar process. You have to meet a few general eligibility requirements for the form, including:
- Being a U.S. citizen (some non-citizens are still eligible)
- Meeting your school’s requirements to graduate on time with a degree or certificate
- Demonstrating financial need
- Having a valid Social Security number
- Registering with Selective Service if you’re male
Watch the filing deadlines
If you’re planning on attending college for the 2020-2021 school year, you should fill out your FAFSA form between Oct. 1, 2019, and June 30, 2020. Check out your state and school’s deadlines, as different colleges and locations will have different FAFSA deadlines.
Other forms of aid
The FAFSA is great, but it shouldn’t be the end of your search for financial aid for college. There are plenty of other grants and programs that could award you even more money as you plan for your education. You can also investigate:
- Federal Pell Grant
- Federal Supplemental Educational Opportunity Grant (FSEOG)
- TEACH Grant
- Federal Work-Study
Federal Pell Grants
If you are an undergraduate student with “exceptional financial need,” you could be eligible for a Federal Pell Grant. Applying for this type of grant is easy; all you need to do is fill out your FAFSA form.
How much you get from a Pell Grant depends on your need, the cost of the school and other factors. In general, though, the grant amount depends on your expected family contribution, the cost of attendance, your status as a student and your plans for how long you’ll attend. For the 2019/2020 school year, the maximum award is $6,195.
The best part of the Pell Grant is that you won’t have to pay it back (except in certain circumstances such as withdrawing from school or getting other outside scholarships and grants).
Federal Supplemental Educational Opportunity Grant (FSEOG)
Like the Pell Grant, the FSEOG is awarded through a FAFSA application. But this particular grant is administered directly by each college and university, so you’ll need to check whether your school participates in the program.
The FSEOG is funded by the U.S. Department of Education, with participating schools each getting a chunk of money to give out to students. Those awards can range from just $100 up to $4,000 per year, but it’ll depend on when you apply, how much funding your school has for this grant, other aid you receive and your level of need.
The best way to ensure you get a piece of the FSEOG pie is to apply early (if your school is eligible). Colleges and universities can set their own deadlines, so ensure you make the cut by completing your FAFSA as early as possible.
A Teacher Education Assistance for College and Higher Education, or TEACH, Grant differs from many other types of aid and loans in that you’re required to be enrolled in certain programs in order to receive the grant. For the TEACH grant, you must:
- Complete a FAFSA
- Be enrolled in a TEACH Grant-eligible program at a participating school
- Meet academic requirements including a GPA of at least 3.25
- Receive TEACH Grant counseling each year to understand the terms of the grant because of its unique program and service obligations
- Work in a related field after graduation
The crucial eligibility requirement of a TEACH grant is that you are enrolled in a program that will train you to be a teacher in a high-need field. Your school determines which courses are required for that program, so check with the institution’s financial aid office for eligibility and other requirements. High-need fields include: bilingual education, foreign language, math, reading specialization, science, special education and other fields identified by the government as high-need.
After graduation, you’ll need to teach in a high-need field for a total of at least four years within eight years after finishing your degree, otherwise the grant will be converted into a direct unsubsidized loan. While in school, you could receive up to $4,000 a year toward that degree, though.
The work-study program is a different path to getting financial aid for college. It helps provide part-time jobs for students who want to earn money to help pay for school.
One nice thing about the program is that the requirements are a bit looser. You can be an undergraduate or graduate student and full- or part-time. The program aims to place students in jobs related to community service or their fields of study, but some students also work on campus for their schools or for private for-profit employers.
Once again, the award amount will depend on your level of need. Much like the FSEOG, the work-study program provides funds to schools from a pool, so the award also depends on how much funding your institution has received.
This route can be combined with other types of financial aid. It’s worth checking with your school to see if they run any sort of work-study program that can supplement other types of aid and help you meet your financial needs.
Don’t miss out: Fill out your FAFSA!
There are a slew of grants, scholarships and programs that can help you pay for your education. The crucial step to many of them, however, is filling out a FAFSA.
Even if you think you might not be eligible for aid, it’s worth it to fill out the form. NCAN found that students in the lowest socioeconomic quintile who filled out a FAFSA were 127% more likely to enroll in a college or university that their counterparts who failed to complete the form. In 2013, a survey found that 91.5% of students who completed a FAFSA enrolled in postsecondary education, compared with 49.7% of students who did not.
Beyond the FAFSA, check with your school’s financial aid office to see if there are programs such as work-study that can help with the costs. You may even discover scholarships and grants such as the TEACH grant that are specific to your field of study.