Career Watch Arkansas 2014 Career Watch Arkansas 2014 | Page 20

How will I pay
for College?
Financial Aid FAQs
If you are planning to attend college,
you should do a little research first. Find
out how much it will cost to go to college,
what part of that cost you and your family
will be expected to pay, and what types of
financial aid are available. The following
information is intended to get you started.
What is Financial Aid?
Financial aid is money awarded to a student
to help pay educational costs. Most financial
aid is awarded according to individual need
and educational costs. The federal government,
state government, post-secondary institutions,
and private organizations provide financial
aid to eligible students in the form of grants,
scholarships, loans, and employment.
Grants and scholarships are awarded based on
either financial need or merit and do not have to
be paid back. Employment can be a job provided
by the college and can be on or off campus. A loan
is money provided by a bank, the college, or the
government, which must be paid back with interest.
Private sources of financial aid come from
social and civic organizations, religious
organizations, and businesses.
How much does it cost to attend college?
Educational costs can differ significantly
from one school to another, depending on the
type of school and your program of study. In
general, costs are lowest at a public vocationaltechnical school, higher at a public community
or technical college, still higher at a public fouryear college, and highest at a private college.
The total cost of attending school today may
range from $2,000 per year to more than $30,000
per year. Financial Aid programs have been created
to help you pay for these costs. Schools with higher
costs often have more financial aid available than
lower cost schools. Therefore, when comparing
costs, it’s very important to determine the
financial aid available. This way you can determine
what your out-of-pocket expenses will be.
But remember, cost is only one factor in selecting

18 | Career Watch Arkansas

a school. Consider your goals, what programs
and opportunities each school offers, and how
well that school will help you meet your goals.
What do educational costs include?  
The total educational costs are called the Cost
of Attendance (COA) and include (1) tuition
and fees, (2) books and supplies, (3) room and
board, (4) transportation, and (5) miscellaneous
personal expenses, such as clothing, laundry,
and recreation. Because the COA includes
items that are living costs but are not paid
directly to the school, the actual amount billed
by the school will be less than the COA.
What is the family’s responsibility?
The primary responsibility for financing a
college education rests with the student and his
family. The family is expected to pay for the cost
of college to the extent that it is able. Financial
assistance is designed to help with the difference
between what the family can afford and the cost
of attendance. The student shares in the family’s
responsibility to pay for college and is expected
to contribute from his earnings and savings.
The amount the family is expected to
pay toward the cost of college is called the
Expected Family Contribution (EFC).
How is the family’s expected contribution determined?
Colleges, government agencies and organizations
that award financial aid based on financial need,
use a process called Needs Analysis to determine
how much the family is expected to pay towards
the cost of a college education. This process uses
both the parent’s and student’s income and assets
and other information about the family such as
the number in college, to calculate the Expected
Family Contribution. During the needs analysis