Financial Aid-Need & Merit Based Aid

Differences Between Need and Merit Based Aid

Most financial aid programs are "need-based" which means the student and family will provide information to determine the amount the family can contribute. Some students may qualify for both Need and Merit based aid while some may only qualify for just need or just merit based.

Need Based

Most financial aid-need based programs are taxpayer supported and administered by federal and state governments. Colleges and communities also sponsor programs to help students pay for college.

Students must demonstrate financial need in order to qualify for need based aid. Need based aid award amounts are based on this formula:

The total cost of college. This includes expenses of tuition, books, room, board, and miscellaneous living
expenses)

Minus your Estimated Family Contribution (EFC). This is what you will be expected to pay regardless of which colleges or schools you plan to attend.

The difference from costs minus EFC will equal your financial need. This is the amount of need based aid that you should qualify for at the institution if you apply early.

The EFC is based your family's financial resources. Here are some facts to consider:

*EFC stays the same regardless of where you go to college/school.

*EFC is always the minimum you will be expected to pay for the year before any financial aid is awarded.

* EFC is an economic calculation and will change
-based on the age of your oldest parent
-the number of students in college in that family
-the income and assets of parents and the income and assets of the student.

*The FAFSA (Free Application for Federal Student Aid) is the document you complete to report your family's financial status.

*January of your Senior Year in high school is the earliest you may file your FAFSA

*You will need to have access to financial records for the year ending in December of your senior year in high school:
-INCOME TAX RETURNS: Both your own returns and your parents/guardians returns
-BANK STATEMENTS: Savings and checking for you and your parents/guardians
-ALL OTHER INCOME SOURCES: Any source of income for student or parent/guardian
-ASSET/DEBT RECORDS: Current values of assets and debts (not including residence) for both students and parents/guardians

*Remember, since the cost to attend varies among the different colleges and schools, but the EFC (family contribution) is constant, the student may be eligible for different amounts of need based aid at different colleges.

Many websites have EFC Calculators that may help you estimate your EFC before filing a FAFSA. When you have estimates of the above financial records you can those plug numbers into the calculator. An estimated EFC will then be calculated

Merit Based Aid

Merit based financial aid is aid given in the form of a scholarship or grant based on a special talent or ability that the student has demonstrated and/or processes.

Merit based aid may be given in competitions (beauty, cooking, writing, art, photography, other talents, etc.) and is earned because you demonstrated a talent or ability to excel beyond the average student.

Merit based aid may include both scholarships awarded by the individual college or university and those awarded by outside organizations.

Merit based aid is typically awarded for outstanding academic achievements which can be based on
*high GPA in college prep courses
*outstanding national test scores
* demonstrating mastery in an academic area such as a foreign language, robotics, nursing, etc.
* demonstration of special talents such as in instrumental or vocal music, athletics, theatre, art, mechanics, etc.
* leadership potential

*community service and involvement in community
*other personal characteristics which could include ethnicity, being first in family to attend college, etc.
*group affiliation such as church/faith based, FFA, 4-H, Scouting, FBLA, etc.

Merit based aid is awarded without regard for the financial need of the applicant. At many colleges, every admitted student is automatically considered for merit scholarships. At other schools, however, a separate application process is required.

Gift, Loan, and Self Support Aid