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Look into financial aid

The confusing part of financial aid is figuring out what kind of aid might be available and how to apply for assistance. Although the large number of financial aid options can be intimidating, here are a few steps you can start to take now.

Apply for federal student aid

Federal student aid includes options such as federal grants, work-study and loans to help you pay for college. To start the process, you will fill out the Free Application for Federal Student Aid, known as the FAFSA.

This form lists your income and financial resources, and much of the required information comes from your income tax return. The FAFSA can be filed online with the Federal Student Aid Office at no charge to you.

For more information, visit

Explore grants and scholarships

Billions of dollars are available to students, but you have to do the legwork to find them. These are extra-valuable forms of financial aid because, unlike loans, you don’t need to pay them back — as long as you complete the program. You will have to apply and qualify for a scholarship or grant, and sometimes an interview or written essay may be part of the process.

Who offers grants

Typically awarded based on need, grants are made by federal, state and city governments; unions and nonprofit organizations; private citizens and private companies; community organizations (like your local Rotary Club); and more.

Who provides scholarships

Scholarships are generally awarded based on merit or the promise to pursue a particular course of study. They’re offered by a variety of organizations, in all fields, in all areas of educational pursuit.

Where to find them

A good place to start is the U.S. Department of Education. Also, check out or for searchable listings, or simply search “how to find scholarships or grants."

Beware of sites that guarantee to find you a scholarship or grant for a fee. Some of these are scams and are just the results of combing the internet, which you can do yourself.

Apply for a student loan

Try to use debt sparingly. If you have to borrow, look to federal student loan programs first. In general, federal student loans have lower interest rates, lenient repayment plans, no prepayment penalties and no credit checks.

Perkins Student and Stafford Loans are popular federal loan programs. To find out more, go to

Financial aid dos and don'ts


  • Apply for aid no matter what your financial circumstances. Plenty of schools award aid based on merit, not just financial need.
  • Save in your name, not your child’s. Financial aid formulas favor parents’ over child’s assets. (Parental assets are currently assessed at a maximum of 5.6%. Students' assets are assessed at a maximum of 20%.)
  • Keep contributing to your retirement account. These assets are not counted in financial aid formulas.


  • Forget that most financial aid packages include heavy doses of student loans. Education debt in the U.S. has hit a record $1.57 trillion, exceeding even credit card debt, according to the Federal Reserve Bank of New York, Household Debt and Credit report as of 04/2020.
  • Start moving assets around in your child’s junior year of high school. Most schools scrutinize your tax information looking back a year or two and base awards on income and assets for those years.
  • Rob from your retirement accounts to pay tuition. You can borrow for education; you can’t take a loan out on retirement.