I bet many of you have seen ads on Facebook that sound something like this:
“Want Student Loan Forgiveness in Two Weeks? CALL NOW!”
“Apply for Obama Loan Forgiveness in 5 minutes!”
Usually, if something sounds too good to be true, then it probably is. There are countless ads online from companies offering to help you manage your student loan debt…for a fee, of course. While the U.S. Department of Education (ED) does offer some legitimate student loan forgiveness programs and ways to lower your student loan payments, they are all free to apply for. Don’t pay for help when you can get help for free!
If you’re a federal student loan borrower, ED provides free assistance to help:
Everyone wants their student loans forgiven. The perception is that very few qualify. But did you know that there is one broad, employment-based forgiveness program for federal student loans? Let me break down some key points of Public Service Loan Forgiveness (PSLF) to help you figure out if you could qualify.
[ 1 ] Work for a government or non-profit organization
Qualifying for Public Service Loan Forgiveness is not about your job, it’s about who your employer is. In order to qualify for Public Service Loan Forgiveness, you must work for a “public service” employer. What does that mean? Everyone has a different definition.
So you filed your FAFSA and got accepted to a college. Congrats! Your school will send you an award letter that lists different types and amounts of financial aid you’re eligible for. These types of aid could include grants, scholarships, work-study funds, or student loans. You might see two types of federal student loans in your letter: Direct Unsubsidized Loan and Direct Subsidized Loan. Some people refer to these loans as Stafford Loans or Direct Stafford Loans or just subsidized and unsubsidized loans. It’s important you know the basics about these two types of loans before you sign to accept either of them.
As a graduate student, I‘m no stranger to filing the Free Application for Federal Student Aid (FAFSA®), and when I filed my 2016-17 FAFSA, I was prompted to create an FSA ID—the username and password you need to log in to the FAFSA. I followed the step-by-step instructions, and voila! I easily created my very own FSA ID in no time!
More than 30 million FSA IDs have been created, and people, like me, have used their FSA ID more than 146 million* times. With any new process, there are some myths floating around about creating and using an FSA ID. Let’s tackle some of those right now…
When I was in my last semester of high school, I checked my family’s mailbox just as much as I checked Snapchat and Instagram combined. It was the season of admissions decisions, and I was getting letters from all the colleges I’d applied to.
But once I’d gotten into several schools, my attention shifted to my e-mail inbox. I was waiting on information that was just as critical: my financial aid offer from each college. I knew that for me, the amount of financial aid I got from a school mattered just as much as the general admissions decision. I’d fallen in love with each of the schools I’d visited, and I knew I’d be happy anywhere. Basically, my choice was going to come down to the money.
Analyzing different aid packages can seem like way too much math for the end of your senior year—at least it did to me—but it’s important stuff. Check out my four steps to make this analysis simpler.
What to do once you get an aid offer
1. Make sure you know what you’re looking at.
The financial aid offer (sometimes called an award letter) typically comes in an e-mail from the college’s financial aid office. The offer includes the types and amounts of financial aid you’re eligible to receive from federal, state, private, and school sources. Be sure you understand what each type of aid is and whether it needs to be paid back. For example, when I got into UNC-Chapel Hill, my aid offer was a mix of scholarships, which I didn’t need to pay back, and private loans, which I did. My offer from Duke (booooo) had mainly the same stuff with some grant money mixed in.
Click to download PDF.
Lucky for you, hundreds of colleges nationwide have signed on to present financial aid offers in a standardized format known as the Shopping Sheet. The Shopping Sheet is a standardized award letter template that makes it easy to compare financial aid offers from different schools. In addition to providing personalized information on financial aid and net costs, the Shopping Sheet also provides general information on the college, like graduation rate and loan default rate.
We all know college is super expensive; not only do you have to pay tuition, but there’s also room and board (for those of you staying on campus), a meal plan (yay for cafeteria food…), and textbooks (buying hundred-dollar books for one chapter). It’s a lot. Luckily for us, there’s help: scholarships! Of course there’s no guarantee that you’ll actually be awarded any money, and sometimes it can seem like a whole lot of work for a whole lot of nothing. But that’s why I’m here! I’ve gone through the process recently (and am doing it again), and I’m at your service with suggestions and tips.
A lot of these tips come from StudentAid.gov/scholarships, so check out that page for a more comprehensive, detailed guide to scholarships.
Types of Scholarships
There are scholarships for almost everything—all you have to do is look. Applying for scholarships doesn’t have to be tedious—find scholarships for things you’re passionate about. Some scholarships are really cool. There are scholarships for animal rescue, volunteering with the elderly, etc.; you can find them through specific organizations, too.
A college or career school education = more money, more job options, and more freedom. Yet, with more than 7,000 colleges and universities nationwide, deciding which college is right for you can be difficult. Maybe you want to find a school with the best nursing program, or study abroad options, or the best college basketball team; every person values different things. However, it’s also important to remember that college is one of the biggest financial investments you will make in yourself. Just as important as academics and extracurricular activities are the financial factors: how much a college costs, whether students are likely to graduate on time, and, if alumni are able to find good jobs and pay off their loans. That is why the U.S. Department of Education developed the College Scorecard. It provides clear information to answer all of your questions regarding college costs, graduation, debt, and post-college earnings.
As you’re comparing colleges, use the College Scorecard to compare these four things:
1. Net Cost
For starters, you should consider how much you’ll actually be paying on an annual basis. That’s not necessarily the sticker price, but it’s the sticker price minus all of the scholarships and grants that you will receive when enrolling in an institution. This is called the net price, and it’s important because it’s the average amount students actually pay out of pocket.The College Scorecard can show you the average net price of each school compared to the national average. It can also give you a net price estimate for each school broken down by family income. Here’s an example:
Student loans, interest payments, and taxes: three things that have scared many people for years now. Read on to learn how these things can benefit you.
If you made federal student loan payments in 2017, you may be eligible to deduct a portion of the interest paid on your 2017 federal tax return. This is known as a student loan interest deduction. Don’t miss out on this opportunity to make the money you’ve paid work for you! Below are some questions and answers to help you learn more about reporting student loan interest payments from IRS Form 1098-E on your 2017 taxes and potentially get this deduction.
What is IRS Form 1098-E?
IRS Form 1098-E is the Student Loan Interest Statement that your federal loan servicer will use to report student loan interest payments to both the Internal Revenue Service (IRS) and to you.
Will I receive a 1098-E?
If you paid $600 or more in interest to a federal loan servicer during the tax year, you will receive at least one 1098-E.
The IRS only requires federal loan servicers to report payments on IRS Form 1098-E if the interest received from the borrower in the tax year was $600 or more, although some federal loan servicers still send 1098-E’s to borrowers who paid less than that.
If you paid less than $600 in interest to a federal loan servicer during the tax year and do not receive a 1098-E, you may contact your servicer for the exact amount of interest you paid during the year so you can then report that amount on your taxes.
How many 2017 1098-E’s should I expect to receive?
That depends on how much you paid in interest, how many federal loan servicers you had, and some other factors. Read through the scenarios below to find where you fit and learn how many 2017 1098-E’s you should expect.
Your current servicer was your only servicer in 2017: In this case, your current federal loan servicer will provide you with a copy of your 1098-E if you paid interest of $600 or more in 2017. Your servicer may send your 1098-E to you electronically or via U.S. mail.
You had multiple servicers in 2017: In this case, each of your federal loan servicers will provide you with a copy of your 1098-E if you paid interest of $600 or more to that individual servicer in 2017. Your servicer may send your 1098-E to you electronically or via U.S. mail.
If you paid less than $600 in interest to any of your federal loan servicers, you can contact each servicer as necessary to find out the exact amount of interest you paid during the year.
How will reporting my student loan interest payments on my 2017 taxes benefit me?
Reporting the amount of student loan interest you paid in 2017 on your federal tax return may count as a deduction. A deduction reduces the amount of your income that is subject to tax, which may benefit you by reducing the amount of tax you may have to pay.
Now that you know student loans, interest rates, and taxes aren’t as scary as you may have originally thought, you are ready to report your student loan interest rates on your 2017 federal tax return!
What if I still need help or have more questions?
While we are not tax advisors and cannot advise you on your federal tax return questions, your federal loan servicer is available to assist you with any questions about your student loans, including questions about IRS Form 1098-E and reporting the student loan interest you’ve paid on your 2017 taxes. If you’re not sure who your loan servicer is, visit My Federal Student Aid to find contact information for the loan servicer or lender for your loans. To see a list of our federal loan servicers, go to the Loan Servicers page on StudentAid.gov.
Congratulations! You submitted your 2016–17 Free Application for Federal Student Aid (FAFSA®)! Wondering what happens next? Here are a few things to look out for:
1. Review Your Student Aid Report (SAR)
After you submit your FAFSA, you’ll get a Student Aid Report (SAR). Your SAR is a summary of the FAFSA data you submitted. Once you have submitted your FAFSA, you’ll get your SAR within three days (if you signed your FAFSA online) or three weeks (if you mailed a signature page.)
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Any student with an FSA ID can view and print his or her SAR by logging in to fafsa.gov and clicking on the appropriate school year. This is also where you can check the status of your application if you have not received your SAR yet. Once you get your SAR, you should review it carefully to make sure it’s correct and complete.
Happy National School Counseling Week! Many thanks to all you school counselors out there for your hard work and dedication.
Click to visit the Financial Aid Toolkit
Many times through the years, I’ve heard how busy the typical school counselor is, with a heavy case load and no time to learn everything there is to know about financial aid. Instead, counselors have sent out a plea for a selection of short, specific items that answer the questions a student will have at various points in the financial aid lifecycle. You asked for it; we built it. It’s called the Financial Aid Toolkit.
What’s the Financial Aid Toolkit?
FinancialAidToolkit.ed.gov is a site that was designed specifically for you, the school counselor, to give you information and resources that will help you educate students and parents about federal student aid for college.
What does the Financial Aid Toolkit offer?
It offers a lot, so be sure to explore the site. Meanwhile, here are some highlights:
Searchable library of fact sheets, videos, infographics, booklets, PowerPoint presentations, archived webinars, and more
FAFSA updates, including a list of which documents will be available on what dates
Why shouldn’t a counselor recommend the Financial Aid Toolkit to students and parents?
The Financial Aid Toolkit speaks to YOU, the counselor. It does not have the type of information or level of detail that a student or parent needs. Please send students and parents to StudentAid.gov for federal student aid information. (For fact sheets, videos, and other student-focused items, send students and parents to StudentAid.gov/resources.)
What else should a counselor know about the Financial Aid Toolkit?
Because the site is designed for you, your feedback is crucial to its success. At the bottom of each page, there’s a “Leave Us Feedback” link that’ll send you to the site survey so you can let us know what you like or what you’d like to see added to the site.
Remember, the Financial Aid Toolkit site is for you. Use it in good health!
Cindy Forbes Cameron has worked at the U.S. Department of Education’s office of Federal Student Aid for a million years—or perhaps 17. (Hard to tell the difference sometimes.) Cindy focuses on website content management and document creation and editing. She loves serving the school counselor/college access mentor community via the Financial Aid Toolkit, listserv postings, and conference exhibiting and speaking.
Completing the Free Application for Federal Student Aid (FAFSA®) is the first step in accessing the more than $150 billion available in federal student aid. To help you get a head start on your FAFSA, below are the answers to the top 5 questions we’ve been getting on our Facebook and Twitter accounts:
1. What is an FSA ID and do I need one?
The FSA ID is a username and password you use to log in to your FAFSA. You should get an FSA ID before you start the FAFSA. If you are required to provide parent information on your FAFSA, one of your parents needs an FSA ID too. Keep in mind that parents should not be making an FSA ID for their child or vice versa.
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Parents will use their FSA ID to sign a dependent child’s FAFSA. However, if they are unable to get an FSA ID, they can mail a signature page.
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Go here to get an FSA ID now. The FSA ID does not define if you are a student or parent, the process of getting an FSA ID is the same for both.
2. How can I complete the FAFSA if my parents or I haven’t filed 2015 taxes yet?
When filling out the 2016–17 FAFSA, you’ll want to use financial information from the 2015 tax year. At this point in the year, many people haven’t received their Form W-2, let alone completed their 2015 taxes. But that shouldn’t stop you from submitting the FAFSA! If you or your parents have not completed your taxes yet, you can estimate your income and other tax return information, and then correct your application after you have filed your taxes.
If your 2015 income is similar to your 2014 income, use your 2014 tax return to provide estimates for questions about your income. If your income is not similar, use the Income Estimator for assistance estimating your adjusted gross income, and answer the remaining questions about your income to the best of your ability. If you do not know your parent’s tax information, we have a guide on how to complete the FAFSA if you and your parent are not together.
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Note: Once you complete your 2015 tax return, you’ll need to update your FAFSA. When you do so, you may be eligible to use the IRS Data Retrieval Tool to access the IRS tax return information needed to complete the FAFSA. This allows you to transfer data directly into your FAFSA from the IRS website.
3. When is the FAFSA deadline?
States, schools, and the federal government each have their own FAFSA filing deadlines. It is important that you research all of these deadlines and complete the FAFSA by your earliest deadline. That being said, because some types of aid are awarded on a first-come, first-served basis, it is highly recommended that you fill out the FAFSA as soon as you can to ensure that you do not miss out on available aid.
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4. Do I have to complete the FAFSA every year?
Yes, you need to fill out the FAFSA each school year because your eligibility for financial aid can differ from year to year for various reasons, including your family’s financial situation and the number of your family members enrolled in college. If you filled out a FAFSA last year and want to renew it, go to fafsa.gov, click “Login”, and be sure to select “FAFSA Renewal” once given the option. That way, many of the (nonfinancial) questions will be pre-filled for you. Just be sure to update any information that has changed since last year.
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5. Which FAFSA should I complete?
When you log into fafsa.gov, you will be given two different options: “Start a 2015–16 FAFSA” and “Start a 2016–17 FAFSA.” Which should you choose?
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If you’ll be attending college between July 1, 2015 and June 30, 2016, select “Start a 2015–16 FAFSA.”
If you’ll be attending college between July 1, 2016 and June 30, 2017, select “Start a 2016–17 FAFSA.”
Remember, you must complete the FAFSA each school year, so if you’ll be attending college during both periods of time, you should fill out both applications.
TIP: If you need to fill out both applications, complete the 2015–16 FAFSA first. That way, when you complete the 2016–17 FAFSA, a lot of your info will automatically roll over.
If you are applying for a summer session, or just don’t know which application to complete, check with the college you are planning to attend.
We hope this answers some of your questions! If you have additional questions about the FAFSA, you leave us a comment below. We also have videos on our YouTube channel. For more information about completing the FAFSA, visit StudentAid.gov/fafsa.
Sandra Vuong is a Digital Engagement Strategist at Federal Student Aid.
If your child is a dependent student and is applying for federal student aid, you—the parent(s)—may need to provide some of your information on and sign the Free Application for Federal Student Aid (FAFSA®). Now, it’s easier than ever for you and your child to complete the FAFSA…even if you’re not in the same place. Help is also available for every question, just look for the “Help and Hints” box on the right side of each screen.
Step 1: You and your child must each create an FSA ID
The first step to filling out the FAFSA is for you and your child to each create your own FSA ID, a username and password. The FSA ID replaces the Federal Student Aid PIN and is required to sign the FAFSA electronically.
IMPORTANT TIP #1: Do not create an FSA ID for your child. Let your child create his/her own. Otherwise, your child could experience problems or delays with his or her financial aid.
Step 2: Start the FAFSA
You or your child can start a new FAFSA. If your child starts the application, he or she should enter his or her FSA ID on the left side of the log-in page. But, if you start the application, select “Enter the student’s information” on the right. Be sure to follow the instructions on each screen to proceed.
IMPORTANT TIP #2: If the parent is starting the FAFSA, DO NOT enter your child’s FSA ID or your FSA ID on this page. Instead, click “Enter the student’s information.”
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Step 3: Create a Save Key
After selecting which FAFSA you’d like to start, you’ll be given the option to create what’s called a “Save Key.” It’s a temporary password that lets you save an incomplete FAFSA, pass the FAFSA back and forth with your child, and return to the application later to add information. Think of it as your key to accessing the draft FAFSA.
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IMPORTANT TIP #3: Once you create your Save Key, make a note of it. Unlike the FSA ID, you and your child can share the Save Key.
So, let’s say your child is away at school and starts his or her FAFSA. He or she can click the “SAVE” button at the bottom of the page and exit. You can then log in at FAFSA.gov using your child’s identifiers and the save key, and pick up where he or she left off!
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From here, you can enter your financial information or any other information that’s missing from your child’s FAFSA.
Step 4: Sign and submit the FAFSA
After you and your child have filled out all the necessary information, you both need to sign the FAFSA. If you’re not in the same location, one of you can sign by navigating to the “Sign & Submit” section, entering your username and password (your FSA ID) clicking the “SIGN” button, saving, then closing the application. The other person can then log in at fafsa.gov using the Save Key, navigate to the “Sign & Submit” section, and sign the application using his or her FSA ID.
Make sure the parent who is signing with the FSA ID checks whether he/she is listed on the FAFSA as Parent 1 or Parent 2 and checks the appropriate box.
IMPORTANT TIP #4: You and your child should enter your own FSA ID in the correct spot—student above and parent below.
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IMPORTANT TIP #5: If you are a parent without a Social Security number, you will not be able to create an FSA ID and will not be able to sign the FAFSA electronically. But, your child can submit the FAFSA without a parent signature, then print a paper signature page for you to sign and return by mail.
Once you and your child have signed the FAFSA, click the blue “SUBMIT MY FAFSA NOW” button at the bottom of the page. Your child’s FAFSA is not submitted until you see the confirmation page. It’s a good idea to print the confirmation page for your records. If your child provided an e-mail address, he or she will receive a copy of the confirmation page by e-mail.
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Once your child’s FAFSA is submitted, it will take three to five days to process. Information on your child’s FAFSA will be made available to the financial aid offices of the schools listed. The school or schools will use the information to determine what aid your child may be eligible to receive.
IMPORTANT TIP #6: On the confirmation page, you’ll see an Expected Family Contribution (EFC). Please note, the EFC is not the amount of money your family will have to pay for college or the amount of federal student aid you will receive. It is a number used by your school to calculate how much financial aid you are eligible to receive.
The confirmation page also provides some financial aid estimates. Please keep in mind that these are true estimates. You may qualify for different amounts or additional types of aid. In order to find out the exact amount and types of aid you’re eligible to receive, you’ll need to wait to receive an aid award from each school you listed.
Photo by Getty Images.
April Jordan is a senior communications specialist at Federal Student Aid.