7 Ways to Get the Best Financial Aid Package for College [VIDEO]

By Dean Tsouvalas
StudentAdvisor.com Editor-in-Chief

Now that applications are in, it’s time for college-bound students to start applying for financial aid to help fund their education. Yesterday I sat down with Gene Lavanchy of Boston’s Fox 25 Morning News Show to discuss ways students and parents can land the best possible financial aid package. While the process of applying for aid may seem as easy as just filling out the FAFSA there’s actually a lot more to it! So what can you do to ensure you’re setting yourself up to receive the most aid?

Learn more about the 7 ways to get the best financial aid package for college:

1. Fill out the FAFSA! It all starts with the FAFSA (Free Application for Federal Student Aid).

One study showed that 53% of eligible families did not bother applying for aid through the FAFSA leaving millions on the table. Colleges use the FAFSA to determine your eligibility for government funded financial aid such as grants and federal student loans. Schools will also determine if you qualify for need-based scholarships based on your FAFSA score. You can do it all online at FAFSA.gov. DO NOT pass on filling out the financial aid paperwork if you think you won’t qualify

2.  Proof read your FAFSA (at least 3 times) to avoid these common mistakes:

  • Listing incorrect Social Security Number or Driver’s license
  • Leaving blank fields – enter a ‘0′ or ‘not applicable’ instead of leaving a blank. Too many blanks may cause miscalculations and an application rejection.
  • Using commas or decimal points in numeric fields – always round to the nearest dollar.
  • Listing marital status incorrectly – only write yes if you are currently married. They want to know what your marital status is on the day you sign the FAFSA, or Renewal FAFSA.
  • Listing parent marital status incorrectly – the custodial parent’s marital status is required; if they’ve remarried, you’ll need the stepparent’s information too.
  • Leaving the question about drug-related offenses blank – if you’re unsure about something, find out before you submit your FAFSA instead of leaving it blank. A conviction doesn’t necessarily disqualify you from getting aid.
  • Forgetting to list the college – obtain the Federal School Code for the college, you plan on attending and list it – along with any other schools to which you’ve applied.
  • Forgetting to sign and date – if you’re filling out the paper FAFSA be sure to sign it. If you’re filing electronically, be sure to obtain your PIN from www.pin.ed.gov. Your PIN is your electronic signature and will always be assigned to you only.

3.  Make sure your parent has as little cash in checking, savings and other cash-equivalents as possible on the day you file your FAFSA.

The final set of questions on your FAFSA will ask about the money you have on hand. Make sure that you and your student have as little money in checking, savings and other cash-equivalents the day you file the paperwork. It also helps to pay off as many bills as possible before filing the paperwork.

4.  Your student should always file a tax return, even if he or she is not making any money.

A tax return that says $0 can actually work in his or her favor, as it demonstrates a need.

5.  Understand that grades have little to do with financial aid awards.

Many parents assume their child must have good grades to qualify for grants and scholarships. This is inaccurate. Most colleges award a majority of their grants based on financial need, not merit. Merit scholarships comprise less than 2% of the total “pot.” Although it’s fun to talk about merit scholarships, the big money – more than 98% – is in the need-based financial aid system.

6.  Don’t wait on your acceptance letters before applying for aid!

Financial Aid is on a first come, first serve basis. You don’t need to be accepted to a college before you can submit your FAFSA – you only need to list which schools you have applied to. Typically, for first year students, colleges mail their financial aid reward statuses to students a few months after the application deadline to accepted students.

7.  Be sure to compare financial aid packages from different schools closely.

Do not be afraid to read between the lines on financial aid reward letters. It’s not uncommon for “expensive” private colleges to offer better financial aid packages than state schools. Examine the gap (if there is one) between the financial aid package and the cost of attendance for each school to see how well the package meets your need. Break down how much money is coming from grants, federal loans, scholarships, and work-study. Grants and scholarships don’t have to be paid back. Work-study money must be earned through part time employment during the school year and students must pay taxes on it. Loans need to be paid back and different families can take on different amounts of debt. Remember – federal loans are less expensive and have more benefits than private loans.

REMEMBER:

You must fill out a FAFSA every year you are in school, but if you apply online, you can re-use your FAFSA-on-the-Web PIN each year you apply for federal financial aid.

Make sure you fill in every year for every child you have in college starting in January of their SENIOR year in high school to ensure you have a chance at receiving the most aid.

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