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  • How Does Federal Student Aid Work?

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    Trying to understand financial aid can induce headaches, anxiety, and frustration. If it's not the acronyms (EFC, SAR, FAFSA), it's the vocabulary (unsubsidized, unmet–need, institutional grants). Let's take a step back and look at the big picture.

    The intent of federal student aid is to make up the difference between (1) what your education costs and (2) what you can afford to pay. This equation clearly paints the picture…

    Sound simple? Well, it is and it isn't. Financial Aid officers prefer using other terminology to express the same meaning. Here is exactly the same equation written using financial aid jargon:

    The cost of attendance refers to the total cost of tuition, room & board, insurance, books, transportation, and other fees. Be cautious not to confuse tuition with cost of attendance – one will be higher than the other!
    Your estimated family contribution (EFC) is the amount of money the federal government has determined you and your family can afford to contribute toward your education. Uncle Sam determines your EFC from your answers on the Free Application for Federal Student Aid (FAFSA).
    Your NEED is the amount that remains to be paid. If you are lucky, the schools to which you apply will "meet" all of your need with grants, loans and work–study. Any left–over amount is called unmet need.

    Remember this simple equation and you can safely navigate the jargon–infested federal student aid waters.


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