Student aid secret: Even high-income families can qualify
- Many families assume they won't qualify for financial aid and don't even bother to apply.
- That's a mistake, even for parents with the highest incomes.
As college costs soar, financial aid can make all the difference.
Still, many families wrongfully assume they won't qualify and don't even bother to apply.
Each year, more than 1.7 million private scholarships and fellowships are awarded, worth more than $7.4 billion. Your family's income doesn't have to stand in the way.
In fact, qualifying for such aid is often not based on income at all.
Merit aid
For starters, there are many different types of merit scholarships available for athletes, minorities, and students in science, technology, engineering and mathematics (STEM) programs. There's also aid for community service volunteers or grants based on leadership skills, musical ability or religious affiliation, according to James Lewis, co-founder of the National Society of High School Scholars, or NSHSS, based in Atlanta.
And more obscure offerings are out there to help cover the costs. For example, incoming freshmen who meet certain height requirements could be eligible for a scholarship from the Tall Clubs International Foundation. (Here are a few more unusual scholarships currently available.)
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Lewis advises students to look for scholarships locally, particularly from organizations in their community, where the odds of nabbing an award are better than national competitions.
"Search your network," he said, including "high school, honor societies, alumni networks, civic groups, employers and houses of worship."
"Make Google your best friend."
Free search sites, such as Tuition Funding Sources, can help students find this most desirable kind of assistance — money that does not have to be repaid.
Some families are catching on. This year, scholarships and grants were the single most-used resource to pay for an undergraduate's college bill, according to the most recent report by education lender Sallie Mae.
Need-based aid
Aside from merit aid, even high-income families could still qualify for need-based assistance.
"That's a mistake, to assume you are ineligible," said Kalman Chany, a financial aid consultant and author of the Princeton Review's "Paying for College."
For example, a school may not consider a non-custodial parent's income, even if it exceeds $400,000 or $500,000, Chany said. "If you are divorced and the non-custodial parent, they may only look at the other parent's information."
There's also more to determining a student's aid than income and savings alone, such as the school's cost of attendance or the number of college-age siblings.
"Some schools will give you need-based money even if you don't demonstrate need because they are getting price resistance," Chany said.
And if your family has two children enrolled in college, that's like dividing the parent's income in half, he added.
File the FAFSA
To access any of that assistance, students must file a Free Application for Federal Student Aid form, which serves as the gateway to all federal money including loans, work-study and grants.
High school graduates in 2017 missed out on $2.3 billion in federal grants because they didn't fill out the FAFSA at all, according to an analysis by personal finance website NerdWallet.
Among those who didn't apply, most said it was because they didn't think they would qualify.
Jennifer Satalino, a financial aid expert with Educational Credit Management Corp., a nonprofit dedicated to helping student borrowers, advises all students to submit the paperwork. "It can really pay off," she said.
"Students and parents will always be eligible for certain types of financial aid."