College Mistake That Hurts!

Wow! I have just learned a very hard lesson while starting the new school year at a bran new college. The hard lesson I just learned was not studying long enough and correctly for a big test that thanks to God I pulled off a 78%.

You may not believe or feel that this is so bad, but if I don't keep a 3.6 or higher GPA I can say good bye to my scholarships.

Let me tell you my mistakes so you can avoid this feeling I have right now.

1) Watching a movie a studying

College is so much fun with there always being something to do. While attending a online college I never got the experience of hanging out with others and making friendships that will last through school. Even though I am having a blast, when it is study time I need to make sure to enclose myself in a quiet room when studying for a test.

Watching a movie and studying is not something that should be done together.

2) Cramming the night before

This is one of the most used methods for college students when doing homework, looking over notes, or cramming for a exam the next day. It has been proven that short frequent periods of studying is the best way to comprehend for college exams and tests while retaining the information after the exam.

A tip for you that need to be taken and used in college is too look over your notes an hour after your class for about 10 minutes or so depending how long it is. Do this and I can guarantee your next text will improve and the night before stress level will drop.

3) Just looking over notes

Looking over the notes you took in class is ok and might work for you but it has been proven that college students test better when they studied with flash/note cards, practice with others, and link notes with understandable meanings you can relate to better.

Well, I am note happy about my test but I know the next test will make up for this one so my college scholarship will not be in danger.

Take care and God Bless!

The Bursar's Office

What is the bursar's office, and how can it help me?

By Carlin Carr

As you probably already know, college is an investment in your future. You will owe some amount of money to the school, and in return, they will provide you with thought-provoking courses and an invaluable experience that will enhance your career and life options.

Of course, there will be an office on campus designated to collecting your end of the bargain on this investment. The Bursar's Office has the responsibility of organizing your tuition account, sending out bills, and imposing late payment charges.

The Bursar's Office does not have to be so intimidating; as long as you are making your appropriate payments, you may only hear from them in your monthly statements. In fact, they can be quite helpful in setting up a payment plan, discussing various fees, and organizing your account.

Your account will usually include any tuition or housing costs not covered by your financial aid award, as well as some other smaller charges. Lab fees, student services fees, interest accrued on unpaid balances, meal plans, health insurance coverage, and late payment charges can all add up fast. Be sure to check with the Bursar's Office from the beginning to see what costs are not covered under tuition.

Organizing your account and making your monthly payments also plays a key role in registration. Most likely, you will not be able to register for next semester's classes if you have an outstanding balance. If you ever have an issue with making your payments, schedule a meeting with a representative from the Bursar's Office; they are friendly and supportive, and they can help you sort through your questions or concerns.

The moral of this story is that the Bursar's Office can be quite helpful in assuring that your money matters are worry-free.

Carlin Carr is a communications writer for Trinity College in Hartford, Connecticut, and recently worked as an admissions counselor at Post University. Carlin received her bachelor's degree in English from Mount Holyoke College and her master's degree in literature and publishing from the National University of Ireland, Galway (NUIG).

After graduating from NUIG,Carlinmoved toParma, Italy, to teach English before returning to the states.

What Is the Work-Study Program?

Discover how work-study can benefit you

By Paula Andruss

As financial aid becomes a necessity for more and more students, many are looking toward the popular Federal Work-Study Program—a federally funded program that assists students in getting part-time jobs—to help them pay their school expenses.

Through this program, the government pays some or all of an eligible student's wages. In return, in addition to earning money for school, work-study students gain real-world work experience and make contacts with employers and others who may become references for future employment.

If you qualify for financial aid, you may be eligible for a work-study program. The total award depends on several factors, including the funding levels of the school and your level of financial need. You'll need to specifically request the program on your Federal Application for Student Aid, and to be considered, you must have a high school diploma or equivalent, must demonstrate financial need, and must be a U.S. citizen or eligible non-citizen.

Jobs may be located on or off campus, and the program will make an effort to match the type of work you are assigned to with your courses of study or other abilities, based on the personal information you provide on your application. On-campus jobs are usually working for the school itself in areas such as dining halls or administrative work. Off-campus work is usually completed with a public agency or nonprofit organization

Work-study students earn at least the federal minimum wage, though some make more if the job requires special skills. You can specify whether you want to be paid directly and use the money for your own expenses or have the money deposited directly into an account to pay for school expenses such as tuition or room and board.

Once you have been accepted into the program, you'll receive information about your prospective employer in a referral letter from your school's financial aid office. But you will still need to contact that employer and be accepted for the position. Then you can work out the specifics of the job, such as salary, hours, and any other obligations. And once work begins, don't forget to keep up on your classes as well: the work-study program requires students to maintain satisfactory academic progress in their courses throughout the year in order to keep the job.

Paula Andruss is a Cincinnati-based freelance writer whose work has appeared in publications including Parents, WomensWallStreet.com, Marketing News, Crain's Chicago Business, and Cincinnati magazine.

How am I Going to Pay for a College Education?

Easing your fears about paying for college with helpful financial aid info

By Rose Rennekamp

For a lot of parents, the first question that comes to mind when their teenagers prepare to attend college is, “How am I going to pay for this?”

Let's face it—college is expensive! The good news: more than half of all college students receive financial aid. Unfortunately, the financial aid process isn't something most of us know much about until we have to dive right into it. Hopefully this column can help you understand what you're getting into before you sign on the dotted line.

College scholarships and grants are the best kind of financial aid. You don't have to pay those back. College scholarships and grants can either be “need-based,” given because of the financial situation of the student and her family, or “merit-based,” either a talent-based or academic college scholarship. Some scholarships are a blend of need and merit.

While college scholarships and grants may be what you're hoping for, there are never enough of those to go around. And, rising tuition could mean you will have to pay a larger share of the college costs.

Loans are a form of financial aid that you will have to pay back. Loans based on financial need often have lower interest rates and are subsidized by the federal government. Loans not based on need are generally not subsidized, and you will end up paying a higher interest rate. Make sure you understand all of the terms of any loans—the interest rate, the repayment schedule, and when repayment must begin—before you commit.

Work Study requires your student to work in order to receive money for school. Students typically work ten to 15 hours per week but no more than 20. Work study jobs are usually on campus, pay at least minimum wage, and can be related to your student's major. A woman I know majored in animal science in college on her way to becoming a veterinarian. She worked at the university's veterinary hospital as part of her work study program. Because of that connection, she had a leg up when applying to the vet school.

When you apply for need-based financial aid, be prepared to provide a lot of financial information. It's a little like filling out your income taxes, and you'll need many of the same records. The form usually required is called the FAFSA—the Department of Education's Free Application for Federal Student Aid. You want to fill it out as early as you can in order to get the best shot at financial aid because some aid is awarded on a “first come, first served” basis. You can find the FAFSA financial aid form on-line at www.fafsa.ed.gov.

The government uses the FAFSA financial aid form to formulate an “Expected Family Contribution”—the amount of money that your family is expected to pay for college expenses each year. I was more than a little shocked when I learned how much the government thought we should be able to pay toward our kids' college educations! You can get an idea of your “Expected Family Contribution” using the free financial aid need estimator at www.act.org/fane. Just keep in mind that colleges can have different ways of assessing need and awarding non-federal aid.

Financial aid is complex, confusing, and even frustrating. The good news is that it does get easier each time you do it. (Yes, you have to do it for each child and every year they are in college.) Just remember: start early, make sure that the information you provide is accurate, and meet every deadline. And, once you get those aid offers, compare them carefully. Most of all, be sure you read and understand everything before you sign anything!

Rose Rennekamp is the vice president of communications for ACT. She is a mom and has a master's of education in guidance and counseling. For more college and career-planning information, visit http://www.act.org/. E-mail Rose at AskRose@act.org.

The College D Word—Debt

Avoid the plastic trap while you're in school

By Christina Couch

The most common four-letter word on every student's lips is D-E-B-T.

When the average college kid owes over $2,500 in credit card debt alone, it's easy to understand why the D word is a student's worst nightmare. To save yourself from financial turmoil, read up on these ways to avoid the plastic trap.

Tip #1: Approach With Caution

Contrary to popular belief, credit cards aren't all bad. Establishing good credit is an essential part of your financial future, so it's important to have a credit card and to use it only if you can immediately pay off the bill. Finding a card is easy. Finding a card that will offer you a reasonable annual percentage rate (APR) and minimal transaction fees is a bit more difficult. Creditcards.com will allow you to compare interest rates, fees, and user rewards for cards designed specifically for students.

Shop around with your parents (they're going to have to co-sign for you anyway), always read the fine print, and be on the lookout for cards with fraud protection to protect your bank account in case the card is lost or stolen.

Tip #2: Handle With Care

Overspending is the easiest way to turn an emergency-only financial cushion into an all-consuming vacuum of debt. To prevent yourself from excessive spending, pay cash when you can, charge only what you really need, and keep an accurate, up-to-date record of money spent.

By taking note of money coming in versus money going out, you can make sure that you're always within your monetary means. If the urge to impulse shop is just too much, ask your company to set a low credit limit on your card, therefore only giving you so much room to get in trouble.

Tip #3: Treat With Respect

Maintaining a good credit report is just as important as maintaining a car or good grades. In the working world, your credit report will serve as a report card of whether or not you've been financially studious.

Good students will be rewarded with the ability to finance cars, mortgages, or small businesses while bad students will be stuck with what little cash they have in their pockets. To earn an A in credit ed, always pay your bills on time and for the full amount unless, of course, you like paying compounded interest charges by the truckload.

Christina Couch is a freelance writer based in Richmond, Virginia and Paris, France. Her writing credentials include MSN/Encarta Online, CollegeBound Teen, and Studentscoop.com. She can be contacted at couchcs@gmail.com.

Picking the Best Financial Aid Package

Search information to help figure out which package meets your needs

By Kimberly Hardy

Paying for college—the final frontier. It does not, however, have to be the most dreadful. After all, your college-bound students have already sent their applications and have already been accepted. The hard part is over! The fiscal issues surrounding college, however, can be stressful if you don't know what to look for.

Many colleges and universities are very helpful—and generous—when it comes to offering financial aid, but become a wise shopper before you accept just anything. Simply because a package may meet 100 percent of your need doesn't mean it's the best deal.

When searching for the right package, the key is to start looking early. Inquire about the types of financial aid offered by the school(s) your students have applied to. You should be interested in the aid the school can provide beyond federal loans, grants, and work-study jobs. You'll want to know if a school has scholarships and grants of its own. Also, search to find out how dedicated to meeting your financial needs a school is. For instance, Duke University in North Carolina is committed to meeting 100 percent of the students' financial need. If you find this out in advance, it may help you narrow down your choices in terms of where you'll consider applying for aid.

Another key is to look everywhere else. Thousands of sources of financial aid—Web sites, scholarship books, community organizations—exist. Did you know there is a scholarship for students who are left-handed? If you work for the United States Postal Service, your students may be eligible for an academic college scholarship from one of your unions. Are your students interested in studying women's literature at a liberal arts school in the Midwest? Money is out there for them. Consider all of the sources that exist: the Internet, the library, or your students' counselors are all great places to start.

A final key to fiscal success in college funding is to complete and return the FAFSA financial aid form as soon after January 1 (the earliest it can be submitted) as possible. You want to know what federal dollars your students will be eligible for as soon as possible because this will help you negotiate a good package with the school(s) they are interested in.

Now, let's suppose two schools have offered your students financial aid packages that meet 100 percent of your demonstrated need as determined by your Student Aid Report from the FAFSA. The single most important thing you'll want to consider is the amount of debt for which you and your students will be liable. Look at the chart below:

Both schools will meet your family's financial needs, but University 1 is offering $5,000 in student loans, which must be paid back with interest. Scholarship searching by you and your students may well have covered that expense in University 2.

University 1

• $5,000—Federal loans
• $1,200—Work-study
• $2,000—Federal grant
• $1,300—Scholarships (from school)
• $9,500/year with debt

University 2

• $5,000—Scholarship (other sources)
• $1,200—Work-study
• $2,000—Federal grant
• $1,300—Scholarships (from school)
• $9,500/year without debt

Reducing the amount of debt you and your students will have upon graduation is important. You don't want to burden them with thousands of dollars of debt right out of school. It may not be possible to avoid loans altogether, but you want to hunt for every free dollar you can early on to reduce the debt later.

If a school truly wants your college-bound students in its freshman class, it will work with you to find funding sources. It's never too early to start looking—a few hours spent performing scholarship and grant searches now can save you lots of cash and anxiety later.

Kimberly Hardy, M.S.W., is beginning the fourth year of her Ph.D. at The University of Chicago School of Social Service Administration.

FAFSA & College Financial Aid Facts

Getting all of the aid for which you are eligible

By James Maroney

Many people believe that private scholarships are the panacea for their college-funding woes. While you may have heard that millions of dollars in academic college scholarships go unclaimed each year, that simply is not true. In reality, private scholarships provide only a small percentage of college funding.

The vast majority of financial aid and grants are provided by the federal and state government and by schools. The following information will help you get all of the need-based aid for which you are eligible.

Need-based aid is determined by considering the Estimated Family Contribution (EFC) and the total Cost of Attendance (COA). The COA should reflect tuition, fees, room and board, transportation, books, and personal expenses. Need-based aid is then calculated by subtracting the EFC from the COA. Colleges will offer financial aid packages that meet your needs to varying degrees.

The first step in filing for financial aid requires you to file the Free Application for Federal Student Aid (FAFSA), which is available in paper format in the high school guidance office or online at http://www.fafsa.ed.gov/. Filing the FAFSA for financial aid online has many advantages. First, the online form is processed in two weeks as opposed to four weeks for the paper form. Second, the online form will check your responses and will not let you submit the application with mistakes. If you have submitted the paper form with an error, it will be returned for corrections and will need to be resubmitted.

Finally, the online form automatically generates an estimate of your EFC.

It is extremely important that you file the FAFSA application before financial aid priority deadlines. Information from tax forms is necessary in order to complete the FAFSA.
The following analogy from a dean of admissions illustrates the importance of filing FAFSA early for college: Financial aid is like a pot of soup. The first couple of ladles are going to be full, but at the end you are going to be scraping the bottom of the pot for what is left. Make sure you are getting your full ladle.

In order for you to receive all of the financial aid money for which you are eligible, make sure you know the requirements of all of the schools to which you are applying. It's also important that you complete the forms as accurately as possible and that you file the applications before the priority deadline.

James Maroney is an educational consultant for First Choice College Placement http://www.firstchoicecollege.com/.

College Money Matters Checklist

Making sure you have everything in order

With all of the financial information available, it's important to make sure your college-bound students run through one final checklist before they reach their final destination in the fall. They should keep copies of all paperwork and pay special attention to any deadlines in order to avoid unpleasant surprises when they arrive on campus.

Make sure they have done all of the following before they head off to college:

• Paid housing deposit
• Received Student Aid Report (SAR)
• Accepted any college scholarships and found out if they have to reapply next year
• Finalized details of their student loan, if applicable
• Planned out a budget for the school year
• Purchased a computer and any related equipment
• Made sure all bank accounts are in order
• Selected an account that does not charge ATM or monthly transaction fees
• Taken care of any car maintenance
• Purchased any necessary airline tickets
• Sent completed section of promissory note to financial aid office
• Put money aside for books, folders, pens, paper, calculators, and other miscellaneous school-related items
• Paid registration fees that financial aid doesn't cover
• Paid tuition deposit and finalized details of payment plan
• Purchased all dorm room necessities (they should talk to their roommates first to see what items they will be bringing.)
• Purchased long-distance phone plan or secure phone card
• Purchased cell phone, if necessary
• Applied for a credit card, if necessary

The Lowdown on Loans

Know your financial obligations

By Crystal Conde

You've filled out the FAFSA, determined how much money your family should contribute to your education, and begun looking into financial aid options. If you're considering taking out a loan, be sure you know your financial obligations. Borrowing money carries with it a great responsibility. The following information, compiled from the Federal Student Aid Web site, will help you determine whether taking out a loan is right for you.

Once you've committed to taking out a loan, you'll be required to sign a promissory note. The promissory note is a written promise that you will pay, at a fixed or determinable future time, a sum of money to a specified bearer. In the case of student loans, the note will outline that you must repay the loan, except in cases of cancellation of the loan. Keep in mind that you have to pay off the loan even if you don't complete your education. You're taking a big step, so be sure you understand all the terms of the promissory note. Keep a copy of it in a secure place because you'll refer to the promissory note if any questions about your obligations arise.

The entity that will service your loan depends on the type of loan you have. When borrowing a Perkins Loan, the school that lends you the money or an agency employed by the school will service the loan. The Direct Loan Servicing Center will handle a Direct Loan, and your lender or its servicing agent will service a Federal Family Education Loan (FFEL).

Borrowing a Direct Stafford Loan or an FFEL will require you undergo entrance and exit counseling. You must participate in an entrance counseling session before you receive your first loan disbursement. You'll receive information about the importance of repaying your loan and the rights you possess as a borrower. In the exit session, you'll be presented with the available loan repayment options.

When you do begin repaying your loan, you must make the full payments (agreed to in the promissory note) on time. Partial or late payments may cause you to go into default, which could have serious financial repercussions. In addition, don't wait for a bill to come before you make a payment. You're required to remit payment regardless of whether a reminder arrives in the mail.

Crystal Conde, a 2001 graduate of the University of Missouri-Columbia School of Journalism, is senior editor at Hobsons in Cincinnati, Ohio. She is the lead content editor on all four editions of The Hobsons U.S. Education Guide.

Earn Smart, Save Smart

Planning ahead to cover your expenses

by Christina Couch

It's called summer vacation, yet for students on a budget, it's anything but. While there may be a day here and there for a weekend beach trip, summer is the only time of year that you can work full-time and hopefully bank enough to keep you in the green for at least the first semester. Your financial future for the upcoming year hinges on how well you maximize profits and minimize expense. Take a minute to review your business vocab, and you'll be one step closer to a fat wallet and a semester free of financial stress.

Gross Income: Your Total Earnings

You want this number to be high…very high. To do that, choose a job or internship that pays well, and set it up early before you have to compete against every other college kid on break. Your company may offer a tuition reimbursement or subsidy plan that would put just a few more bucks in your pocket. Consider taking a second job (it's only for the summer), selling some things you don't need on eBay, or picking up a few odd jobs in your spare time. Remember that you'll probably get back any taxes taken out, sending another much-needed check your way in spring.

Net Income: Your Gross Income Minus Expenses

The first thing to do is define “expenses.” What are you willing to spend money on this summer? Creating a weekly budget can help prevent you from blowing your check on unnecessary expenses. Plastic counts too, so before you say “charge it,” think of that gruesome bill at the end of the month. If possible, have your employer deposit your earnings directly into your account. The less cash there is burning a hole in your pocket, the less likely it'll be gone before your next payday.

Investment Return: How Your Money is Working for You

When cash sits in a savings account instead of a box under your bed, it draws interest without you having to lift a finger. If you can clear the minimum balance requirement, invest in a money market account to get the best return interest rate. Students interested in longer term, higher profit investment options should consider savings bonds (typically bought at half the value they return) or mutual funds. Though your cash will be tied up for months, if not years, you'll be rolling in dough when time's up.

Christina Couch is a freelance writer based in Richmond, Virginia, and Paris, France. Her writing credentials include MSN/Encarta Online, CollegeBound Teen, and Studentscoop.com. She can be contacted at couchcs@gmail.com.

College Education on Loan

Consider some of the primary sources of loans available for students and families

By Jennifer Liedtka

No doubt about it, the cost of college can be a big one. Four-year, two-year, public, private, trade—regardless of the type of higher education institution your students decide to attend, a price tag will be tied to the experience.

How will you pay for it? Is financial aid in your family's future? Often, when people refer to financial aid they think only of free money. While students benefit from many types of scholarships and grants, it is important to realize that an even greater amount of assistance is available in the form of education loans. It's true this type of aid is not free—at some point repayment will be required. The terms of many of the programs, however, are quite favorable. Responsible borrowing for education is a great investment.

Consider some of the primary sources of loans available for families.

Stafford Loans are the most common types of student loans from which every student may benefit—regardless of family income. Based on the need of the student, the institution will determine if the loan will be subsidized (interest-free while the student is enrolled) or unsubsidized (interest assessed while the student is enrolled). Regardless, a dependent student may borrow up to $2,625 as a freshman, $3,500 as a sophomore, and $5,500 during the junior and senior years. While the annual amounts may not seem like much compared to the cost of many institutions, the relatively low interest rates and favorable repayment terms make this a good place to start borrowing and an ideal way for traditional students to begin establishing credit.

Perkins Loans have a fixed interest rate of five percent and deferred repayment of principal and interest until nine months after graduation. These loans come with some of the best terms available and offer a good way for students to borrow.

What happens if financial aid (including the above loans) does not cover your students' total costs? If your family is not in a position to make this payment, a PLUS Loan for credit-worthy parents of dependent students is an option. With a variable interest rate capped at nine percent, you may take advantage of this federal program to borrow all or any part of your out-of-pocket expenses that remain after aid is deducted from the bill.

If you aren't in a position to borrow or you feel that it is the responsibility of your child to do so, a private alternative student loan might be an option. Many loans with a variety of terms exist in this category. Traditional students often need a credit-worthy cosigner in order to borrow a private education loan, and they may typically borrow all or any part of the funds needed to cover their bill.

Regardless of the borrowing needs of your family, it is important to talk with your institution about loan processing procedures and the particular programs and lenders most commonly used there.

Jennifer Liedtka is the director of financial aid at Lebanon Valley College in Annville, Pennsylvania.

Understanding College Financial Aid & Grant Packages

Outlining the types and amount of financial assistance that you receive

By Paula Andruss

As the costs of college continue to rise, borrowing money for your education has become one of the best investments you can make. That's why college financial aid is so important, whether it comes in the form of grants, scholarship money, work-study, or loans. While applying for financial aid can be a lengthy process, results are well worth it in the end.

About three to six weeks after you submit your Free Application for Federal Student Aid (FAFSA) to obtain financial aid, you should receive a Student Aid Report (SAR) from the government. Check over this report carefully to make sure the information from your FAFSA is correct and that it is being sent to the schools to which you have applied. It's also a good idea to get in touch with the school or schools that should have received your SAR to make sure that they did in fact receive it.

The SAR will list your Expected Family Contribution (EFC)—a dollar amount calculated from a standard formula by the government that indicates how much your family should be able to contribute to your educational expenses. This number is critical to your financial aid package because it determines your financial need, or how much financial aid you are eligible to receive. In general, your financial need is calculated by subtracting your EFC from the total cost of attending each individual school.

Once the paperwork is complete, each college's financial aid office will put together a financial aid package comprised of federal and non-federal aid such as loans, grants, scholarship money, or a work-study program to help meet your needs.

It's difficult to estimate exactly how much financial aid you will receive because educational costs vary from school to school, and different colleges participate in different financial aid programs and have varying amounts of grant money to award. But each school's financial aid office will do its best to make up the gap between your EFC and the cost of attending that school.

When the process is complete, you will receive financial aid award letters from your schools of interest. Each will outline the types and amount of financial assistance that school is offering for that year. When you receive the award letters, be sure to compare the aid packages offered by the different schools; even though one school may appear less expensive, it may not contain the best deal for you.

Paula Andruss is a Cincinnati-based freelance writer whose work has appeared in publications including Parents, WomensWallStreet.com, Marketing News, Crain's Chicago Business, and Cincinnati magazine.

Avoiding College Scholarship Scams

Protecting yourself and your money

By Deborah Hardy

“CONGRATULATIONS! You have won a $10,000 scholarship for college. To obtain your award, please forward a $100 processing fee to…”

Usually, most parents and college-bound students would not go beyond those first words. Eventually, students and parents come to realize that it was only a scam. Instead of winning, they have lost.

How can you determine which scholarships are legitimate? To avoid being the victim of a scholarship scam, set up guidelines to identify which scholarships might be of concern. Here are some warning signs to look for:

Processing Fees

Scholarships that require a processing fee should raise a red flag. Some scholarships add a disclosure statement that guarantees the winnings and states that students will be eligible for a refund. These are additional scam slogans to ensure that college-bound students will be comfortable as consumers. In reality, the money never returns.

Rewards without Entries

For most students, writing another college admission essay after all of the college process is tedious. When an award is given without the student having to submit a college scholarship application, it is quite surprising. Beware the awards without entries.

Guaranteed Scholarships

In the world of financial assistance, there is never any guarantee. Guaranteed college scholarships never materialize.

Free Seminar

This on-the-spot scam lures parents and students by sending letters that ask them to attend a seminar in which the organization will present attractive materials that guarantee students will qualify for college scholarship money. A fee is charged or may be deducted from your bank account. Your students receive a package with a few scholarships listed. Often, other sources, such as the school counselor or a credible database, will have information on the scholarships presented.

Now that you know how to spot scams, how can you protect your students from these scams? For starters, never pay a fee. A scholarship is a gift from a given group. Why should anyone have to pay to process a college scholarship application or to receive an award? Also, if it sounds great, beware.

Get more information about the organization. Call the Better Business Bureau or visit the Web site at www.bbb.org. When dealing with scholarship organizations, be savvy and determine whether a group's name seems to masquerade as a federal organization or a charitable program.

Many scholarship databases provide accurate and reliable sources. Ask your students' school counselor before your students apply. Getting the right information can earn you the biggest reward of all.

Deborah Hardy is director of guidance at Irvington High School in New York.
Register now to be entered into the drawing for a $20,000 college scholarship sponsored by CollegeView!

Purchasing Power on College Campus

Beware of the credit card trap

By Crystal Conde

Credit card companies bombard students with card offers on many college campuses. To persuade you to apply for a card, company representatives may hand out T-shirts, key chains, coffee mugs, and other products. You may want to have a card for emergencies and for establishing a healthy credit history.

Be careful: some of the cards have high interest rates and limited credit lines. You should understand that credit cards, when used properly, are an effective means for building a good credit history. But when used carelessly and irresponsibly, credit cards may do more harm than good—you may find you're in debt and the victim of a bad credit report for years following graduation.

With credit cards so easy for college students to obtain, you may be wondering why companies view them as appealing card holders. The answer is loyalty. Credit card companies know that students tend to use their first credit card long after graduation. Evidence of the desire to gain college students' business can be found online. Visa, MasterCard, and American Express have information and online applications tailored just for students.

If you've decided a credit card is necessary, set up some guidelines and ground rules. Make the decision to pay monthly statements on time and in full. Determine the credit card's function: is it for emergencies only or for school supplies and books?

Set a foundation for credit card usage to avoid frivolous purchases. Also, figure out a budget. Put your monthly expenses on paper, and estimate how much you can afford to pay on a credit card.

Your parents may be able to provide the best example for teaching you about managing credit cards. Sit down with them and examine a credit card statement. Your parents can explain what particular terms mean—finance charge, minimum payment, credit limit, cash advance. Your parents can impart some of their credit card wisdom and can teach you to use a credit card properly when you begin college.

When it comes to applying for a credit card, be selective. To stay debt-free, shop for a card that offers the following:

• low interest rates or finance charges
• low or no annual fees
• a grace period for posting finance charges
• other benefits such as warranties, free gas, airline miles

Crystal Conde, a 2001 graduate of the University of Missouri-Columbia School of Journalism, is senior editor at Hobsons in Cincinnati, Ohio. She is the lead content editor on all four editions of The Hobsons U.S. Education Guide.

Help with College Financial Aid

Understanding aid options and knowing where to get help

By Ann Bezbatchenko

Financing your education can be an overwhelming task. To make the most of available funding, it is important to understand the different types of aid as well as to realize that your financial aid office is available to help you.

There are two primary types of aid: federal financial aid (based on need) and scholarships (university and outside awards). To apply for federal financial aid, you must complete and submit the Free Application for Federal Student Aid or FAFSA.

You can complete the FAFSA online at http://www.fafsa.ed.gov/. From the information submitted, the U.S. Department of Education determines how much aid you should receive and notifies your school. The National Association of Student Financial Aid Administrators also has a Web site which has helpful resources for students and parents.

Your university will send you information about your federal aid as well as any scholarships you received. (You may have to complete specific forms for various scholarships. Check with your university admissions office about applications.) If you have been awarded a scholarship through an outside source, you should notify your financial aid office immediately so that your financial aid package can be adjusted.

Most universities assign a general counselor, depending on the size of the school, to certain populations. For instance, there may be a counselor for first-year students, several for returning students, and one for graduate students. If you need to meet with your financial aid officer about your award package or issues with your financial aid, you should contact them directly. It will be important to bring any information you may have about your federal financial aid and scholarship awards.

After graduating from the University of Dayton in 2000, Ann Bezbatchenko worked as an editor for SRA/McGraw-Hill Companies. She returned to school to obtain a master's degree from The Catholic University of America, where she worked as the Assistant Director of Graduate Admissions for CUA. Ann currently works at Loyola University Chicago's Graduate School of Business as the Director of Admissions

Do Some Digging to Get College Financial Aid

Find out about financial aid and the conditions that accompany it

By Rose Rennekamp

A few years ago my daughter graduated from high school and entered college with a full-ride academic scholarship in engineering. We were thrilled. But after experiencing the world of college engineering, she changed her mind—and her major. She also lost her scholarship.

While I don't recommend that students stick with a course of study they don't like just to keep their financial aid, I do recommend that students and parents find out as much as they can about financial aid and the conditions that accompany the aid they do receive.

Every family's financial aid situation is different depending on family assets, student assets, how many family members will be attending college, tax decisions the federal government makes, state funding programs, and specific college funding opportunities. Yes, you'll need to do some legwork, but I'll get you started with some ideas and resources.

First, the good news. The U.S. Department of Education reports that while the price of higher education is going up, so is the amount of financial aid you can get.

One necessary and important step is to fill out the Free Application for Federal Student Aid, or the FAFSA, as it's better known. The FAFSA determines your child's eligibility for student financial aid from federal programs. A copy can be obtained from your high school counselor, college financial aid office, or you can file online at www.fafsa.ed.gov.

Colleges and universities also use the FAFSA information, though some may require you to fill out additional forms.

You can submit the FAFSA beginning January 1 for the upcoming school year. Fill it out as soon as possible and be sure your information is accurate. If you wait too late in the year, the money may have already been awarded to other students. Make sure you meet the deadlines because there is absolutely, positively no flexibility.

Financial aid sources are basically scholarships and grants, loans, and work opportunities for the student on campus, commonly called work-study. The financial aid package—a blend of these aid sources—is determined by the college to which your child applies. It's important to understand and follow the college's directions regarding the aid.

Scholarships are based on merit or need. Merit scholarships can be awarded for athletic or academic abilities, but also for categories such as club membership, interests, ethnicity, talent (e.g. art, music, dance), or career plans. Many companies provide scholarships to children of employees as well. Need-based awards are given by colleges and the federal government based on financial aid information the family provides.

You hear a lot about scholarships: thousands of dollars go unclaimed or a student is paying his or her way through four years of college entirely on scholarships the student found and applied for. Both of these examples misrepresent what happens in most cases. Apply for scholarships, but don't overestimate the role that scholarships will play in financing a college education. Many of the scholarships are smaller—it takes a lot of them to add up.

You may also receive offers to find scholarship information for a fee, but you never need to pay for that information or pay to apply for a scholarship. The Federal Trade Commission says warning signs include:

• having to provide credit card information
• a scholarship guarantee “or your money back”
• a claim that you can't get the information anywhere else
• that your student is a finalist in a contest he or she never entered

Your high school counselor will have binders full of scholarship information and a number of Web sites put thousands of scholarships at your fingertips. One, http://www.collegenet.com/, provides a scholarship search of more than 600,000 awards totaling more than $1.6 billion in aid.
If you will rely on student loans, you'll have a lot of company. Make sure you and your child understand the loan programs.

Federal Stafford loans (to the student) require payment to begin six months after the student leaves school. The parent PLUS loans require payment soon after the funds are delivered. For more information and current rates, check the Department of Education Web site at www.finaid.org.

Check with your high school counselor or college financial aid office about special programs. In some states, for example, students entering job areas of great need—such as teaching in low-income areas—qualify for financial aid or forgivable loans.

As you search for financial aid, don't rule anything out. Don't assume that you are ineligible for aid or that a college will be too expensive. Do the paperwork, apply to the colleges, and see what offers come in. Then make your decisions.

Rose Rennekamp is the vice president of communications for ACT. She is a mom and has a master's of education in guidance and counseling. For more college and career-planning information, visit http://www.act.org/. Send an e-mail to Rose at AskRose@act.org.

"I can't afford college" and Other Financial Aid & Grant Myths

Find the truth behind five top financial aid myths

By Rose Rennekamp

College application season is in full swing. Parents and college-bound students are filling out forms, editing college admission essays, and checking their bank accounts. Students worry about getting a rejection letter, but some parents may worry more about what they will do once their son or daughter is actually accepted.

There's a lot of information out there—both good and bad—about paying for college. I want to clarify a few of the less-than-true statements you may have heard.

Myth #1: You can't afford college, or you can't afford the college of your dreams.
Many students and parents see the tuition price, cost of college dorm life, and the price of textbooks and say there is just no way they could ever afford it.

Let's face it—college is expensive! It's the largest single investment many families ever make. However, two out of three students get at least some financial aid to help make college more affordable. College-bound students can receive a combination of grants, loans, scholarships, or work-study jobs to help reduce the cost of college. So don't ignore a college just because of its “sticker price.”

If a college has higher tuition, students often can get more financial aid to help cover the extra cost. For example, parents with incomes below $40,000 aren't expected to contribute to the cost of their child's education at Harvard.

Myth #2: You have to be very poor, very smart, or uncommonly talented to qualify for financial aid.

Financial aid comes in many forms—grants and scholarships, which you don't have to repay, and loans, which you do have to repay. There is need-based aid for students who come from lower income families, and merit-based aid for students who excel in athletics, drama, debate, instrumental music, community service, and many other areas. You will find financial aid and grants from a number of sources: the federal government, state government, the college or university itself, a parent's employer, and many other organizations.

When students take the time to discover all of the possibilities, they can be surprised at what offers for aid they may receive. One good source for information is www.ed.gov/finaid.html, where you can get The Student Guide: Financial Aid. The guide is also available in print at many public libraries and schools or by calling 1-800-433-3243.

Myth #3: You can get more free college scholarships by paying someone to search for you.
Scholarship scams are everywhere. Beware of any group or individual that guarantees a scholarship if you pay a fee. In 2003, the Federal Trade Commission found 12 of 53 Web sites marketing scholarships had what it called “dubious claims.” There are many very good, FREE scholarship sources—check out www.fastweb.com or www.finaid.org.

Myth #4: My child will pay for college herself, so it doesn't matter how much money I make.
Most need-based financial aid is based on parents' income and assets. Most schools require students to fill out the FAFSA, the Free Application for Federal Student Aid, in order to qualify for financial aid.

That form asks for income information similar to what you need for your income taxes. You can find it by logging on to www.fafsa.ed.gov. After submitting the FAFSA, students receive a report that shows how much the government expects you to pay towards your child's education.

If you're not ready to actually file the FAFSA for financial aid yet, you can get an estimate of your expected family contribution by going to www.act.org/fane/.

Myth #5: You can wait until you get accepted to a college before worrying about financial aid and grants.

Most financial aid is doled out on a first-come, first-served basis. Since most students will search for some type of financial aid, you shouldn't wait too long to get started. Looking for financial aid is probably not the way that most teenagers want to spend their free time. But a little work now can go a long way in paying for an education tomorrow.

Rose Rennekamp is the vice president of communications for ACT. She is a mom and has a master's of education in guidance and counseling. For more college and career-planning information, visit www.act.org. E-mail Rose at AskRose@act.org.

College Financial Aid 101: Isn't There a Sale Around Here?

A timeline to help you through the financial aid process

By Carlin Carr

Although many colleges and universities have heavy price tags these days, don't let that discourage you from applying. There are many financial aid options out there for college freshmen—from grants and scholarships to parent and student loans—that can help lower tuition costs and make college more affordable.

How much financial aid you need will depend on a variety of factors. If you are planning on living at home and attending a state university or a community college, you will probably not need as much assistance as you would living away from home at a private institution. So, in order to sort out your options, here's your first college lesson: Tips on Financing Your College Education.

Juniors: It's never too late to save! Even if you only save enough for books, your after-school-job money will give you a head start. Also, you should attend financial aid information nights at your high school and top college choices.

Seniors: As a college admissions counselor, I know that senior year can be a hectic and emotional year for students, so my advice is to follow this easy timeline:

November: Apply for your pin number for your FAFSA (Free Application for Federal Student Aid). Most schools require this form to determine how much financial aid you will need. The FAFSA financial aid form can be accessed at www.fafsa.ed.gov.

January: Start filling out your FAFSA college financial aid form. After January 1, you and your parents/guardians can submit your information. Check with your colleges to see if they require any additional forms.

March: Review your SAR (Student Aid Report), a report of all the data submitted through your FAFSA, for accuracy. Be sure to update any current tax information.

April: Watch the mail for your acceptance and financial aid award letters. Compare your award letters, and then choose the best option for you and your family. Remember that college scholarships and grants is free money, while loans have to be paid back.

May: Sign and return your financial aid award letter. Don't forget to decline the award letters from the schools that you will not be attending. If your award does not cover all your costs, you may need to apply for an educational loan through your local bank. Call your college's financial aid office for more details.

If you follow this timeline, your senior year and the financial aid process will be a whole lot smoother!

Carlin Carr is a communications writer for Trinity College in Hartford, Connecticut, and recently worked as an admissions counselor at Post University. Carlin received her bachelor's degree in English from Mount Holyoke College and her master's degree in literature and publishing from the National University of Ireland, Galway (NUIG). After graduating from NUIG,Carlinmoved to Parma, Italy, to teach English before returning to the states.

Five Tips for Paying for College

Advice to make paying for college a little easier

By Christina Couch

The only thing harder than getting into college is paying for it. Here are five tips on earning your degree for less.

Think Ahead—The earlier the research process begins, the bigger the payoff. As early as sophomore year, your student should begin collecting and organizing applications, recommendations, test scores, essays, and transcripts. Students should begin applying by junior year in order to take advantage of the countless scholarships geared toward younger students. Creating a family calendar of application deadlines will help you both set realistic goals and stay on top of the mountain of paperwork.

Think Federally—The most crucial step in the scholarship process is filling out the FAFSA for financial aid. The FAFSA is the Free Application for Federal Student Aid. Available online at www.fafsa.ed.gov or by calling (800) 4-FED-AID, FAFSA is the only way to apply for college grants, scholarship money, and/or loans issued through the U.S. government. Get your forms in order now and mark it on the calendar to get your hands on the nation's biggest financial aid resource.

Think Locally—College tuition could be no farther than your own community. Organizations such as the Rotary Club, the Jaycees, the American Legion, and Boosters chapters have college scholarship funds set aside specifically for area high school seniors. Memorial scholarships honoring local residents are also a lucrative, but typically overlooked, resource.

Since competition for local funds is significantly less than that for national awards, researching what's offered just around the corner could pay off in a big way. Start by stopping by your students' high school career office to see what's available, then follow-up by asking prospective colleges about their scholarship, financial aid and grant packages.

Think Categorically—Your college-bound student may be eligible for certain scholarships by virtue of ethnic, religious, and professional affiliations. Books such as Peterson's Scholarship Alamanac 2005, The Scholarship Handbook 2005, and Scholarships, Grants, and Prizes 2005 can help your college-bound student find scholarship money from around the world that meets your financial requirements.

To find out what kinds of funds your student is qualified for without leaving your home, create a profile through an online scholarships search engine and let the opportunities find you. Sites like Fastweb.com, Scholarships.com, Finaid.org, and CollegeView.com allow you to sift through thousands of career, college, and heritage-based scholarships to find what matches your interests, activities, and needs.

Think Corporately—For Chris Barrett and Luke McCabe, “think corporately” meant draping their dorms, cars, and bodies with the logo of First USA Financial. As the first corporately sponsored college students, Chris and Luke earned their tuition by acting as spokespeople/walking billboards. The good news is you don't have to wear a company logo to take advantage of corporate scholarships.

Businesses ranging from Coca-Cola to Target offer financial aid and grants to thousands of students each year. First, ask about whether or not you or your spouse's company offers scholarships to children of employees. For information on what outside corporate scholarships your student may be eligible for, check out Peterson's Scholarship Almanac 2005.

Christina Couch is a freelance writer based in Richmond, Virginia, and Paris, France. Her writing credentials include MSN/Encarta Online, CollegeBound Teen, and Studentscoop.com. She can be contacted at couchcs@gmail.com.

Getting Good Grades in College

Collaboration

When I was in a college class that was especially difficult, I invited another student in the class to study with me. We benefited from each other's class notes. We were able to ask each other questions and formulate problems for each other that we thought would be important test items. We practiced solving our own test problems together until we felt like we had some mastery. It helped us both significantly.

Being in a position to teach (explain) something to a colleague helped me clarify and reinforce my own learning. During the test I was more confident and could work faster.

Mastery vs Understanding

The course was an important requirement, but really out of my field of expertise. When I got a low grade on a mid term essay test, I changed my study methods and concentrated on learning more detailed terminology and names so I could use the technical terms, dates, and theories when writing answers to questions. I had made a fundamental mistake in learning. It was not enough for me feel that I understood what was being said in the lectures.

I had to feel like I could master the material. I could no longer "blow off" the reading assignments. On the final, instead of only giving general summaries for answers, I also gave specific examples to substantiate general principles. When studying, I made preliminary lists and sub lists to help myself organize materials and arguments better. On the final exam the professor found substance in my responses.

He found evidence that I could use the material. He was more convinced by my answers. I was quite proud to move from a bad grade on the mid term to an average grade on the final in a field that was totally out of my field of expertise.

Too Much Too Fast

I was in a college class with lots of new material outside my field. I couldn't take notes fast enough and think about what was being said at the same time. I took a tape recorder into class. During the lecture my class notes were sketches of relevant material and ideas. After class I added notes from the tape. This gave me a chance to rethink the material while still remembering the presentation. This was a second chance to jot down possible test questions and to make associations with prior knowledge and experiences.

Making Applications

I don't remember new things well unless I can make an application of the new knowledge. I try to make my own imaginary creative application of the concept being learned. I often jot down or sketch the application.

Visualizing

It helps me to think visually. It is hard for me to remember things by rote memory alone. To somehow picture something helps make a much better imprint on my memory. I use my imagination. I sketch it. We remember faces better than names. Faces are visual. Names are words.

Motivation to Practice

Not many college tests are actually tests of skill. However, some tests are. Computer software skills are tested in some of my courses.

In art courses like ceramics and photography not all of the grade is not based on tests, but much of the grade is based on the quality of artwork produced. Skill is not the only requirement for strong work, but skill with the camera, or at the enlarger is very useful to me when attempting to produce good artwork.

I find it hard to practice new skills just for the sake of practice because I keep getting distracted by other stuff I would rather be doing. My concentration is so bad that it becomes a waste of time.

Therefore, it is much easier for me to practice a new skill when I give myself an assignment or when I volunteer to produce something for somebody. Once I need to know the skill in order to produce something meaningful, I can learn difficult material and be prepared to do it on a test if needed. Having to teach something to another person is also very good motivation for me to practice it.

Mistakes

Experts are those who routinely review their mistakes to see what they can learn from them them. I find that mistakes are good in two ways. In the first place, a mistake is an obvious reason to make a correction, to try another way, or to practice more.

In the second place, I find some mistakes are not so bad, but they are actually the suggestions of better things to come. Some of my most creative solutions to difficult problems have been inspired by accidents and mistakes. Highly creative individuals are very good at seeing the potential in accidents, mistakes, and opposites.

Online College Tips for Success

High Achiever Shares Secrets of Success

Returning to school and getting a Ph.D. at the age of 47 wasn't easy for former mechanic and rock musician Frank Koscielski.Frank admits, "Probably the greatest challenge for me and I think one that is shared by most adult learners is finding time to work, live and go to school. I developed a variety of strategies to maximise the time available for study and writing:

1. Take a speed reading course.
Reading fast need not be an end in itself. What Speed Reading teaches you to do is to keep going through a text without re-reading words, sentences and sections over and over. It is really a form of self-discipline. You will amaze yourself how much faster you can read and still understand and retain information.

2. Never go anywhere without a book.
Time spent waiting in line or in the car while someone is shopping or playing soccer or whatever can be study time.3. Keep a tape recorder in the car.After reading a chapter or a book sometimes the ideas flow when you can't write things down. I have dictated entire papers this way that then can be transcribed.

4. Quiet time.
Find a quiet place to study and be a little selfish with your time.Learn to say no.

5. Use post-it notes as bookmarks.
Simply put a word or two at the top to create your own reference index. This saves you when writing a paper from having to reread whole chapters.

6. Kill your TV!
There is very little you can watch on TV that won't be a rerun or appear on ESPN Classics. If you must, discipline yourself to tape a selected show that you can watch later and zip through the commercials. Don't waste time!

7. Be an active reader.
Take notes. In your own books write in the margins. Highlight the most important parts with your own code of x's, *'s or whatever. Don't reread irrelevant stuff.

8. Find time to rest.
If you allow yourself to get totally exhausted, not only will you be unable to learn, but you could get sick, further hampering your learning efforts. If you keep falling asleep while reading, don't blame the text, don't tell your teacher the course is "boring" get some sleep!

9. Exercise a bit.
It stimulates blood flow to the brain and relieves tension.

10. Read all your work aloud to someone else.
It'll save valuable time proof reading, and improve your writing. If it sounds crummy, it is.Returning to school, especially to a program designed especially for adult learners like the Interdisciplinary Studies Program at Wayne State University, can be a wonderful and enlightening experience.Do it now, no matter how old you think you are. As Satchel Paige said: "how old would you be if you didn't know how old you were?"

Sleep Your Way to Better Grades

We have been told since childhood that we need eight hours of sleep for optimum health, safety and performance. And yet according to a National Sleep Foundation poll, 63% of Americans don’t get this recommended eight hours. Pulling all-nighters to cram for exams is just one of the many reasons college students don’t get their recommended sleep. Since the lack of adequate sleep affects our memory and ability to think, it’s essential to improve your sleep if you want to improve your grades.

Do you wake up to an alarm clock every morning?

If so, according to Dr. Wilse Web, a psychologist at the University of Florida, Gainesville, “you’re shortening your natural sleep pattern.”

Many people believe that there is widespread sleep deprivation in our nation. As a matter of fact, lack of sleep has been implicated in train, truck, oil spill and space shuttle accidents. These incidents indicate that lack of sleep can lead to inability to concentrate, think fast, make wise decisions and drive safely. For college students the inability to concentrate or remember facts during a test increases the stress and worry of competing for top grades. Here are some things you can do about it.

First, get the right amount of sleep.
Experts tend to agree that between six and nine hours is adequate for the average person. To find out more about your own sleep needs, take the quiz “How’s Your Sleep?” at http://www.suite101.com/external_link.cfm?elink=http://www.sleepfoundation.org. While you’re there, also check to see how much you know about sleep with their survey, “What's Your Sleep IQ?”

Second, once you know the right amount of sleep for you, make and stick to a schedule.
Sleeping at the same time each night is beneficial. While loss of sleep accumulates over time to contribute to tiredness and drowsiness, sleeping does not accumulate. Unlike money, you can’t save up sleep and borrow from it later. You need to sleep enough and consistently; catchup sleep doesn’t work.

Third, by-pass naps for the real thing.
I know you’ve heard the benefits of short naps, but nothing substitutes for a full night’s sleep. You’ll not only be more alert while doing homework, but you’re less likely to doze off in class during lectures or nod during movies while on a date. To aid yourself in falling asleep avoid caffeine in the evening and instead, meditate or exercise.

Fourth, don’t try to compensate for sleep with caffeine and coffee.
Using these to compensate for lack of sleep is not worth the side dangers of diabetes, heart attack and addiction.

Comparing College Loans

Which Loan Is Best for You?

Comparing loans isn't always easy, since the loan terms can vary. Here are some factors to consider when comparing loans:

Four Key Variables

The four most important variables to consider are interest rate, whether loans are subsidized or not, loan fees, and repayment options.

Interest Rate

The lower the interest rate, the less expensive the loan and the less you'll repay over time.
Subsidized or Unsubsidized?

Loans based on financial need are subsidized. This means that the federal government pays the interest on the loan while you're in school. This benefit makes the loan much less expensive for you. If you qualify, always borrow a subsidized loan first.

Fees

Most loans have origination and other processing fees. This means that although you borrow (and must repay) the entire loan amount, say $2,500, you may only receive $2,400 after the fees are deducted. So, keep your eyes on these fees.

Repayment Plans

Some offer a full range of repayment plans as well as incentives, such as interest rate reductions for on-time payments. Before borrowing a loan, make sure you understand the repayment requirements and options.

You Pay Back More Than You Receive

Even with the favorable terms of a student loan, whenever you borrow money, you will pay back more than you receive. Only borrow what you need.

Find the Least Expensive Loan

Try first for the least expensive loan. The least expensive loan is generally the loan with the lowest interest rate. In order, they are:

• Perkins
• Subsidized Stafford/Direct
• Unsubsidized Stafford/Direct
• Private

Note: If you have access to a special loan program from a college or private source, find out the terms and compare it with the above loans.

File the FAFSA

If you're thinking about taking out a loan, file the Free Application for Federal Student Aid (FAFSA). If you show need, the loan will be less expensive than if you borrow "outside of need." The federal rules will help guide you as the FAFSA is required before the college can approve an unsubsidized loan.

Your College Loan Options

Education Loans Come in Many Shapes and Sizes

There are lots of loan options out there. Read on for expert advice and information about all your options.

Some Facts

• 54 percent of all financial aid comes in the form of loans.
• Some loans are need-based -- meaning that they're awarded when the family demonstrates financial need.
• Other education loans are not need-based. Instead, they're designed to help pay the family share of costs.

Some Advice

Need-based loans tend to have better terms, so you should consider those loans first.

Student Loans

There are four main types of Federal student loans:

Perkins Loans
Perkins Loans are need-based loans and are awarded by the financial aid office to students with the highest need. The interest rate is very low -- 5 percent -- and you don't make any loan payments while in school.

Subsidized Stafford or Direct Loans
Subsidized Stafford Loans are need-based loans with interest rates in the 4-6 percent range. The federal government pays the yearly interest while you're in school. This is why they're called "subsidized" loans.

Unsubsidized Stafford or Direct Loans
Unsubsidized Stafford Loans aren't based on financial need and can be used to help pay the family share of costs. You're responsible for paying interest on the loan while in school. You may choose to capitalize the interest. The advantage of doing this is that no interest payments are required. The disadvantage is that the interest is added to the loan, meaning that you will repay more money to the lender.

Grad PLUS Loans
This is a student loan for graduate students sponsored by the federal government that is unrelated to need. Generally, students can borrow Grad PLUS loans up to the total cost of education, minus any aid received. The advantage of this loan is that it allows for greater borrowing capacity. However, we recommend that students consider lower-interest loans, such as the Subsidized Stafford or Unsubsidized loans prior to taking out a Grad PLUS loan.

Other Student Loan Options
Private student loansA number of lenders and other financial institutions offer private education loans to students. These loans are not subsidized and usually carry a higher interest rate than the federal need-based loans. The College Board private loan program is an example of a private education loan for students.

College-sponsored loans
Some colleges have their own loan funds. Interest rates may be lower than federal student loans. Read the college's financial aid information.

Other loans
Besides setting up scholarships, some private organizations and foundations have loan programs as well. Borrowing terms may be quite favorable.

Parent Loans
Parents also have federal, private, and college-sponsored loan options.
Federal PLUS loansThe PLUS Loan program is the largest source of parent loans. Parents can borrow up to the full cost of attendance minus any aid received, and repayment starts 60 days after money is paid to college.

Private parent loans
A number of lenders and other financial institutions offer private education loans for parents. These loans usually carry a higher interest rate than PLUS Loans.

College-sponsored loans
A small number of colleges offer their own parent loans, usually at a better rate than PLUS. Check each college's aid materials to see if such loans are available.

College Financing Options

When the Family Share Is More than You Can Afford

There are a variety of financing options available for families who are concerned about their ability to meet their family share of costs. These alternative sources of aid, most often in the form of loans, can help families cover financial aid "gaps," or unmet need in a financial aid package.

Student Loans

If you meet certain criteria, you could qualify to borrow an additional student loan such as an unsubsidized Stafford loan or a private education loan. Note: these loans tend to be more expensive than need-based loans.

Federal Unsubsidized Loans

Students who don't demonstrate need, or need to borrow more than the subsidized loan amount, can borrow unsubsidized Stafford loans. Unlike subsidized loans, you are responsible for paying interest on the loan while in school. The College Board offers unsubsidized federal Stafford loans through its Education Loan Program.

Private Student Loans

There are a number of privately-funded (non-government) loans available to students to help meet the family share. These loans are also known as alternative loans or supplemental loans.

Parent Loans

Parents can also take on loans to help cover the expected family contribution. Certain rules -- such as demonstrating good credit -- will apply, depending on the loan. Parent loan options include federal PLUS loans and private loans.

Federal PLUS Loans

PLUS Loans are the most popular loans for the parents of dependent undergraduate students. Parents can borrow up to the full cost of education minus any financial aid. The interest rate is fixed, currently 8.5 percent for July 1, 2006 - June 30, 2007. Repayment of both interest and principal begins 60 days after the loan is fully disbursed to the school. Learn more about PLUS Loans.

Federal Grad PLUS Loans

Graduate students can borrow up to the full cost of education minus any financial aid. The interest rate is fixed, currently 8.5 percent for July 1, 2006-June 30, 2007. Students receive an automatic deferment while in school. There is no grace period, however, students may request up to a 6 month forbearance after leaving school.

Private Education Loans for Parents

There are a number of private (non-government) education loans for parents. Many of these loans are available from banks.

Home Equity Loans

If your parents are homeowners, it's likely that they can "borrow against their home." Your parents may be eligible to borrow as much as their equity, which is the difference between the market value of their house and how much is owed on the mortgage. This money can be used to pay for education costs. The rate is comparable to other borrowing options.

An advantage of a home equity loan is that the interest paid may be deductible on your parents' federal tax return. A disadvantage is that they may have to pay a fee for this type of loan.

IRA Withdrawals

An IRA is a savings account designed to put aside money for retirement. The main options are the Traditional IRA and the Roth IRA.

Under either plan, you can be charged a 10 percent fee if you withdraw money before you reach age 59 1/2. If the money is used to pay for college expenses, the 10 percent fee is waived. However, you may be required to pay federal and state income tax on your withdrawals.

Tuition Tax Credits

A tax credit is an amount of money you can subtract from your federal tax bill. It is a dollar-for-dollar reduction of the amount you owe. If you have family members in college, and your income doesn't exceed certain limits, you may apply for a credit of up to $1,500 per year.

10 Essential Borrowing Tips for College Loans

And the Number One Borrowing Tip Is...

1. Looking at your award letter, figure out which need-based loans you have been given and for what amounts.
2. After you look at your full financial picture -- education cost, awarded aid, and family share -- settle on an amount you actually need to borrow.
3. Never borrow more than you need. Remember, you're not required to borrow the full amount of loan you've been offered or to borrow the maximum loan amount.
4. Don't forget about student employment as an alternative for borrowing. Although working at a job can seem like an extra burden, so is struggling with high loan repayments after college.
5. Apply for your loan right away. You want to make sure that the loan is approved and the money paid to the college before you have to make your first student account payment.
6. Follow the loan application instructions carefully. Any mistakes you make will delay receipt of the funds.
7. For a Stafford or Direct Loan, be prepared for the amount that is paid to the college to be less than the amount you signed for. A fee of up to 4 percent will be subtracted from the loan before the check is sent to your college.
8. Once you know the amount you're borrowing, start to keep track of your "loan tab" -- what your monthly repayment amount will be after graduation. Our Student Loan Calculator will do the math for you.
9. If you feel you need to borrow more than the amount that's been offered in your award letter, talk with a financial aid counselor before taking on an additional loan.
10. If you do take on an additional, unsubsidized loan, consider making interest payments while in school. They won't be much and will save you money -- you'll end up having to pay back significantly less than if you delay (and capitalize) the interest payments.

College Loan Borrowing Process Works

"Need" Loans vs. "Outside of Need" Loans

Today, loans are the largest form of student aid, making up 54 percent of the total aid awarded each year. Most students can expect to receive a loan as part of a financial aid package. There are two broad categories of loans, loans based on financial need and loans not based on financial need.

Loans Based on Financial Need
The federal government is the principal provider of need-based loan funds. Your award letter will list the type and amount of need-based loans.

Features of Need-Based Loans
Need-based loans usually share three distinct features:

2) Low Interest Rates

The Perkins interest rate is currently 5 percent and the Stafford interest rate is 6.8 percent* (for in-school, grace, and deferment). No credit check is required for a federal student loan.

2) Delayed Repayment

With a need-based federal student loan, no payments on principal are due until after you graduate or leave school.

3) In-School Interest Subsidy

This means the government pays the interest that accrues on the loan while you are in school and during the six-month grace period after graduation, resulting in substantial savings. Without this subsidy, either you would need to make interest payments while in school, or those payments would be added to the principal of the loan, making it a much more expensive loan.

Three Need-Based Loans
Typical need-based loans are Perkins loans, subsidized Stafford loans, and Direct loans. For loans based on financial need, the aid office will help guide you through the process.

• Perkins Loan

If you've been awarded a Perkins Loan, the Financial Aid Office sends a promissory note that must be signed and returned. Since the college already has been given its Perkins funds, it simply transfers the loan to your student account as a credit against charges.

Many lenders, including the College Board, now offer online loan applications.

• Subsidized Stafford Loan

For a Subsidized Stafford Loan, the aid office will ask you to choose a lender from a list they provide. Many lenders, including the College Board, now offer online loan applications.

Once you complete the loan application (a master promissory note) and the loan is approved, the money is sent by the lender to your school. The loan amount (minus the loan fee -- as much as four percent) will appear as a credit on your account.

• Subsidized Direct Loans

Direct loans work the same way as a Stafford except that the federal government is the lender.

Non-Need-Based Loans
These "outside of need" loans are used to help families that can't afford to pay their expected contribution from savings and current income.

Some colleges will include one or more of these loans in your award letter. When reviewing your aid, these loans should be removed and put to the side. When you calculate your family's share of costs, you may find that it is more than you can afford -- if so, it's time to consider these loans.

Features of Non-Need-Based Loans
Non-need-based loans:

1. usually have higher interest rates

2. have no in-school interest subsidy

3. may also require immediate repayment of principal

Four Non-Need-Based-Loans
The four main types of non-need-based loans are unsubsidized Stafford or unsubsidized Direct Loans for students, PLUS Loans for parents, Grad PLUS loans for graduate students, and private loans, for students or parents.

• Unsubsidized Stafford or Direct Loans

You must file a FAFSA before applying for an Unsubsidized Stafford Loan. The Student Aid Report (SAR) will show if your family has need. If so, you can take out a subsidized loan and save money on interest payments -- we recommend checking with the college to learn what application procedures to follow. You must complete the same master promissory note whether the Stafford or Direct Loan is subsidized or not. Once the loan is approved, the funds are sent to your college.

• PLUS Loans

This is a parent loan, sponsored by the federal government, that is unrelated to need. Generally, parents can borrow up to the total cost of education, minus any aid received. Many lenders, including the College Board, will provide quick pre-approval for a PLUS Loan within minutes, either online or over the phone. Once the application is completed and the loan is approved, the money is sent to the student's college.

• Grad PLUS Loans

This is a student loan for graduate students sponsored by the federal government that is unrelated to need. Generally, students can borrow up to the total cost of education, minus any aid received. Click here to apply for a quick Grad PLUS Loan pre-approval within minutes, either online or over the phone. Once the application is completed and the loan is approved, the money is sent to the student's college.

• Private or Alternative Loans

Private education loans are available to both parents and students, usually at higher interest rates than the federal loans described above. In almost all cases, a credit check and approval is required. Colleges and universities may provide a list of private loan sources.

If you are considering such a loan, the College Board offers private loans for both students and parents. You can also check with banks or other financial institutions with which you have accounts.

While not considered financial aid loans, for many families, non-need-based loans can play an important role in making college affordable, particularly for families that are unable to pay the family share from current income and savings.

Fine-Tune Your College List: Part 3

By Princetonreview.com

You have your list of schools in front you. You've sent away for brochures from all of them. Maybe you even have a file folder for each of the chosen ones. The rejects are in a pile in the corner of your room. You think to yourself, "This is it! These are my final, final schools." And then, something happens that changes your mind?

Maybe you got your SAT scores back. Maybe your parents took a list at the final school and said "Hawaii? You're not, we repeat NOT, going to school in Hawaii." (And they made that look that means they are never going to be swayed.) Whatever the reason, sometimes you need to take another look at your list of schools and make a few last-minute adjustments.

Your SAT or ACT Scores are Back and They're Great!
Congratulations! This may move some of your borderline Reach schools closer to the Match category. While test scores are only part of the admissions equation, if you've managed to score big, and the rest of your application is strong, you've definitely adjusted the odds in your favor-especially since most colleges will look at your highest scores.

What does this mean for your list? You might want to consider adding another Reach school since you're feeling better about your chances of admission. Don't overreact to this piece of good news, though. You'll still want to keep a Safety school or two on your list for good measure.

Your SAT or ACT Scores are Back and They're Less Than Stellar (Sigh!)
If that 100-point increase on the SAT Verbal you were banking on didn't come through, don't panic. But, do get real. Make sure your college list is in line with your stats. And make sure your designated Safety schools are, in fact, safe. Again, remember that your test scores are just part of the equation, but if something has changed (lower grades, class rank) make sure your school list reflects it.

Parental Reality Check
Perhaps your parents didn't think you were serious when you said you wanted to apply to School X, and now that they see you are, they say no. This can be a real bummer, but it does happen. Remind yourself that it is better to find out now than after you've spent all that time and energy on the application.

And, if you have your heart set on the school, make the case about why the school is a perfect fit to your parents. Are there ways you can talk out your differences? If your guidance counselor is willing, perhaps your parents can come in to school so you can all meet together to discuss the pros and cons.

Financial Reality Check
Your parents may also have some input on your school list when they come to grips with the tuition cost. While it can be tough to talk finances with your parents, make sure they are comfortable with the schools on your list.

If finances are in question (hey, it's a tough economy out there), make sure your list has a few financial safeties (a state school or a school at which you have a shot at getting a scholarship or serious financial aid) on it.

These are just a few examples of things that can change your mind about your list of schools-even when you thought you had reached the home stretch. The important thing here is to be aware of anything that may have changed your situation. This is the time to tweak that list before you actually commit to which schools will receive your application.

Whittle Down Your List of Schools: Part 2

By Princetonreview.com

Okay, so you've made your preliminary list of schools and you're ready for the next stage in the college selection process - making some cuts. It's time to make some tough choices.

Reassess Your Preliminary List & Classifications
If you've kept up-to-date with our other suggestions, you've already classified your 15 or so schools as Reach, Match, or Safety. If you haven't done this yet, please do so now.

Read over the list of schools and see if you're still as keen on them as you were a few weeks ago. Have you heard anything about a school that makes that school more or less desirable? For example, did a friend report back that social life at a school on your list revolves around fraternities and sororities?

That's great if it interests you, and not so great if it doesn't. While you don't want to let informal information like this guide your final decision, it should spark additional research on your part.

Write a List of What's Important
By now, you should have a pretty good sense what your priorities are. But, how well do the schools on your list match up with them? It's time to get specific and ruthless. Write down your priority list. What must you have on campus, in the classroom, or close-by your future school?
Once you have your priorities documented, evaluate each school to see how it measures up to your list.

Serious research may be needed. Take advantage of the Internet and all that material you've been collecting on each school over the last few months. It might be helpful to create a chart that helps you compare your schools. Or, you might want to do a Pro/Con list for each school (if you have a folder for each school, write it right on the cover). Remember, it might be impossible to find the perfect match, but you want to know what you're giving up.

Cross off Some, Keep Others, and Reevaluate the Balance
With this analysis in hand, (not a small job, by the way), you should be able to make some cuts and whittle your list down to eight to ten schools.

Check to make sure the Reach, Match, Safety balance is still good. Discuss with your parents how many schools you'd like to apply to - while many applicants apply to eight or more colleges, it's expensive and time-consuming. If eight schools is your desired goal, consider 2-3 safety schools, 3-4 match schools, and 1-2 reach schools.

If you only want to apply to six schools, a 2-3-1 mix might be appropriate. If you're not satisfied with how the schools on your list stack up, or if the balance is skewed - go back to the drawing board, or in this case, your guidebooks or Counselor-O-Matic.

Start Your List of Schools: Part 1

By Princetonreview.com

In the beginning, when you are just getting started on your serious college research, think BIG.

Don't limit yourself.

Preliminary Search
Start by doing a college search such as Counselor-O-Matic. There are thousands of schools out there. At this stage, you just want to eliminate those that don't fit your basic needs.

Get your results. Click on any school's name that strikes your fancy to read more about it. You don't have to get too deep into a school's description just yet. If there's something about it that you like (size, location, academics)—add it to your list.

Add Schools
Add any schools that you think you might like to attend based on your prior knowledge (from friends, family, teachers, etc.). Even if a school wasn't returned in your Counselor-O-Matic results, go ahead and add it.

Classify Schools
At this point, you should have about 15 or so schools in your list. Now it's time to classify them as Reach, Match, and Safety. If you aren't sure what category they fall into, visit their profile pages and click on the Is it a Fit? link to see what Counselor-O-Matic has to say. The reason you want to classify schools at this early stage is to make sure you have a broad range of schools in your preliminary list. If you only have Reach schools, you should go back and find a few other schools you are interested in that fall into the Match and Safety categories.

Go Back For More
Good news—you're on your way. Bad news—there's a lot of work to be done. Get out your accordion file, file folders, or whatever organizational system you're using, and start researching. Visit each school's website. Send away for more information. Take notes. Keep all your school information in one place.

If you decide you're not so fond of a school after all—cross it off you list. If you come upon a new school that strikes your fancy, add it! If you think you've misclassified a school, move it to the more appropriate category. Talk with your parents about the schools on your list. You don't want there to be any surprises later on.

Once you started your secondary research, you're on your way. Once you're done, you'll be ready for the next stage.