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Sure, you've heard about the Indy 500 and the Daytona 500, but you might wonder, what the heck is the FAFSA?
I was hoping you'd ask. It's a college competition that's less physical than football, doesn't require a court like basketball, and isn't intellectual like a chess tournament. Still, the FAFSA requires speed, accuracy, and endurance. But more than anything else, timing is crucial, the stakes are enormous, and winners can pocket tens of thousands of dollars.
If you have children headed toward college, FAFSA is guaranteed to be in your financial future. Whether Junior is headed for State U or Costly College, your family's cost will be based to a great extent, if not entirely, on what appears on your Free Application for Federal Student Aid (FAFSA) -- which you should submit as soon and as accurately as you can, right after January 1st of Junior's senior year.
Even though your taxes won't be prepared by then, and you'll need to send in an estimate (followed later by an updated form), don't delay!! And don't forget to sign the application, or you'll go to the bottom of the pile, which means you very well may end up with zero financial aid.
We're talking real money here, folks. At last count, a year at Harvard ... not counting books or those occasional trips home ... costs a budget busting $31,132. The average annual cost at private colleges is $20,273, and it's $7,773 at state schools.
By preparing in advance for the College Payment Olympics, you and your family can find yourselves in the winners circle, gold medal firmly in hand. (OK, it won't be a gold medal, but you could save enough money to buy a bunch of them.) If you play the FAFSA race right, it'll mean a lot more money left in your pocket.
The quickest way to file is online (where you get prompted if you haven't filled in information correctly). But since the online version isn't posted until early January (that's government for you!), the best approach is to get the paper version, and work ahead of time with that. Then, if you decide to file electronically, you'll have all the info gathered. Your local school should have the current FAFSA.
With few exceptions, your EFC will be the same at all colleges. What won't be the same is your debt load. All other things being equal, you'll have to shell out more for a private school than for a state-run one. But all things aren't equal, and many private colleges have enough financial aid money available, so that four years in their ivory towers won't cost you any more than four at the good ole state school.
Because the amount of financial aid is limited at every school, early FAFSA filers are most likely to get help, while late filers may get nada. If your child is a high school senior planning to go to college, filling out a FAFSA accurately and sending it in early is an all-important investment of your time and energy -- and THE way to start the New Year off right.
For more on selecting the right college, and then paying for it, see our book, Invest in Yourself: Six Secrets to a Rich Life, as well as the books and Web sites we recommend here.
To help your child receive the special honor s/he deserves, ask at the high school, as well as where you work, pray, and belong -- be it the VFW, NAACP, AFL-CIO, or the Boy Scouts. Also go to: www.fastweb.com/fastweb, www.collegeboard.org, and www.salliemae.com.
Financing College -- by Kristin Davis ($17.95)
If you're haunted by those astronomical tuition projections, this
easy-to-read guide will help you formulate a battle plan for affording
college. Kristin Davis, an editor at Kiplinger's Personal Finance
Magazine, takes you every step of the way -- from developing
the best investment strategies, to understanding all your financial
aid options. She explains how your kids can save on living expenses
on campus, and how you can get the most out of the new education IRAs
and tax credits.
Paying for College Without Going Broke -- by
Kalman A. Chany ($18.00)
Are you dreading filling out those complicated financial aid forms?
This is the book to have by your side. Updated annually, it includes
line-by-line guidance on completing the two most widely used forms.
You'll also find lots of valuable advice on long and short-term strategies
for meeting those college bills without breaking the bank.
Don't Miss Out: The Ambitious Student's Guide to Financial
Aid -- by Anna & Robert Leider ($9.00)
This annually updated classic gives you the lowdown on how financial
aid really works. Packed with insider tips and resources, it's must
reading if your children are juniors or seniors in high school. The
book's sections on financial aid trends and myths and misconceptions
are especially useful in helping you play the college money game.
The current edition also spells out how the new educational legislation
will affect families. A great value.
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