The Never Ending Application Season

The college application process is stressful enough, there is so much pressure to find the "perfect" place and ensuring our applications are strong enough to be considered into our dream school. On top of all this stress, many of us also have to worry about paying for our four next years without being in debt for the next decade. Being able to understand student loans and the financial aid process can not only ease uncertainty, but it will also help you make informed decisions as to what you can afford and your next steps.

Whether you're a high school senior deciding if you can afford to go to college or a current college student looking to finance your studies, here’s everything you need to know about the whole process:

Types of Financial Aid

Federal

Federal Loans, are offered by the government and have low, fixed interest rates.

• Subsidized loans are need-based, and the government covers interest while you’re in school(max of $5,500 for 1st year).

• Unsubsidized loans aren’t need-based, and interest accrues from the time the loan is disbursed (Max of $20,000 for 1st year).

• Federal Grants: Based on financial eligibility as determined by information you provide on the FAFSA. FAFSA is used to determine eligibility for state and federal grants, scholarships, and loans. The FAFSA can be completed on the Federal Student Aid website. and criteria established by the federal government.

• State-level financial aid consists of grants, scholarships, and work-study programs offered by state governments to help in-state residents pay for state colleges.

• These programs vary widely from state to state so be sure to check your state's website for more information.

Institutional aid is financial assistance provided directly by colleges and universities to help students afford tuition and other costs.

• Typically private institutions offer the highest financial aid packages. Many top universities match 100% of demonstrated need.

  Schools may also offer the most scholarships, grants, and work-studies

• Merrit-Based Scholarships: Awarded solely on the basis of academic, artistic, or athletic achievements.

• Need-Based Scholarships Awarded to students who demonstrate financial eligibility and who file both the CSS Profile™ and FAFSA.

State

Institutional

Private

• Private loans are offered by banks, credit unions, and other financial institutions.

• They often have variable interest rates and may require a co-signer.

• Private loans don’t offer the same protections or flexible repayment plans as federal loans.

FAFSA vs. CSS

FAFSA, or the Free Application for Federal Student Aid, is your first step in applying for financial aid. Completing the FAFSA allows you to access federal loans, grants, work-study programs, and overall FAFSA is required by many scholarships or institutions to gauge your financial situation.

You will need to fill out the FAFSA form every year to qualify for federal aid, so don't forget your logins

How to Apply for FAFSA: Key Steps

1)Create your FSA ID as early as possible: Both you and a parent (if you’re a dependent) need an FSA ID to sign the FAFSA. Visit studentaid.gov

2)Gather documents like your Social Security number, 2023 tax returns, and bank statements.

(The new FAFSA has only 36 questions so take your time on each and make sure they're accurate)

3)Visit FAFSA.gov after it opens December 1st (for 2025-2026) to begin your application.

4)Pay attention to deadlines, school and state have their own deadline for FAFSA-- missing them can limit your aid options!

The CSS is an application for non-federal financial aid administered by the College Board. While FAFSA is used primarily for federal aid, the CSS Profile is used by many private colleges and universities to determine eligibility for institutional aid, such as grants, scholarships, and loans provided directly by the school.

The CSS has more than 200 questions that goes more in-depth into your financial circumstances. Be sure to take your time with this one and gather the proper documents or even do it alongside the FAFSA to make this step easier.

Families do have to pay $25 for initial applications and $16 per each additional report, but college board offers many fee waivers for low income families.

1) The CSS opens October 1st this year and many schools require this completed very early(check with your college's financial aid page for deadlines)

2) Visit https://cssprofile.collegeboard.org/ and you may log in with an existing College Board account. Then tap sign in and begin your application!

Remember to... Ask Questions!!

• Financial aid can be complex, so don’t hesitate to reach out to financial aid advisors or consult online resources like Federal Student Aid. Especially if you are in a complicated situation, you may not be able to find straightforward answers online so be sure to reach out to the schools you are applying to or https://studentaid.gov/help-center/contact.

• Explore each option carefully, look around for the best deals, and understand the long-term commitment of student loans before accepting them.

Tips for Reducing Student Loan Debt

• Apply for Scholarships Regularly: Many scholarships are offered on a rolling basis, so keep searching and applying even after starting college.

• Consider a Work-Study Program: Work-study jobs can help offset tuition or living expenses and often offer flexible hours that fit with your school schedule.

• Budgeting and Financial Planning: Track your expenses and create a budget that limits borrowing to what’s necessary. Use tools like budgeting apps or our Gen Z personal excel budget to make this process so much easier and organized.

Repayment Plans: Things to Know Before You Borrow

• Federal Loan Repayment Options: Federal loans offer flexible repayment options, including Income-Driven Repayment (IDR) plans, which cap monthly payments based on your income. Other options include the Standard Repayment Plan (10 years) or the Extended Repayment Plan (up to 25 years).

• Loan Forgiveness: Certain careers (like public service or teaching) offer loan forgiveness programs, allowing some or all of your loan to be forgiven after a certain period of service.

• Private Loan Repayment: Private loans generally don’t have as many flexible repayment options, so be sure to read the terms carefully. Refinancing can sometimes help, but it typically requires a strong credit score.

529 Educational savings plans

A 529 is a great way for your parents or yourself to start saving for college. Ideally you would want to open a 529 as soon as possible but its never too late to open an account.

• What It Is: 529 plans are investment accounts (that vary state to state) specifically for education expenses. While they’re not traditional brokerage accounts, they allow investments that grow tax-free if used for qualified education costs. Some state offer tax deductions for contributions as well. Overall, 529s are a great tool to help ease the financial burdens of college. They are especially effective in long-term growth with the goal of covering college or other educational expenses.

• How to open a 529: Anyone can open a 529 account for you through any state's 529 website, banks/credit unions, or through an online service such as Fidelity or Vanguard. Each platform will have their own investment options, fees, and benefits so make sure to shop around for the best fit.

Conclusions

This can be a very stressful time for most students, but if you come prepared and plan ahead then this whole process may not seem as bad, hey it might even be exciting!

Just remember not to stress to much about it and take care of yourself. Some things are just out of your control, so just do your best and know that whatever happens, you can still make the best out of your experiences. Best of luck to all the seniors out there going through this intense process, you got this! 😼