Four Things You Should Know About FAFSA

Many people think of college as an unaffordable luxury, and while this is often true for private universities, attending college can be both affordable and practical. To celebrate Financial Aid Awareness Month, we would like to explain the basics of financial aid and provide an overview of how the Free Application for Federal Student Aid, known as FAFSA, can help make college more accessible.

1. What is financial aid?
   Financial aid is a broad term that refers to different types of financial support that help students cover the cost of their education. This includes grants, scholarships, and loans. Grants are typically awarded based on financial need. Scholarships are available for academic or extracurricular achievements, and loans are money borrowed that you must repay with interest. Interest on the loans could be subsidized or unsubsidized. Subsidized loans are beneficial because the government covers the interest while you’re in school. On the other hand, unsubsidized loans accrue interest from the moment you receive them.
   
   
2. What is FAFSA?
   FAFSA is an application that determines a person’s eligibility for various grants and loans. The amount awarded depends on your income, living situation, age, and financial aid history. For example, in 2024, a college student can receive a maximum of $7,395 in Pell Grants and between $5,500 and $12,500 for direct subsidized loans (Federal Direct Stafford Loan). For detailed information, you can read this article. The funds you receive are sent directly to the universities you have applied to and can be used to pay for tuition, on-campus housing, meal plans, and other university expenses. Generally speaking, the lower your income, the more likely you will receive the full amount for grants and loans.
   
   
3. Why is FAFSA essential in communities of color?
   Some states give more financial help than others, which can make it harder for Black and Latino students to get the aid they need. A study from the Urban Institute found that only 39% of Black students who received Pell Grants also got state grants, compared to 49% of Asian and 46% of white students. Additionally, some states only give money to full-time students, which can be challenging for Black and Latino students who might need to go to school part-time. FAFSA helps ensure these students have a fair chance of getting the financial support they need to attend college.
   
   
4. How can you overcome financial aid challenges?
   While accessing financial aid can be challenging, there are ways to overcome barriers. Here are some strategies:
   1. Seek Support: Utilize resources such as college counselors, financial aid offices, and community organizations that can guide and assist in completing the FAFSA.
   2. Apply Early: For 2024-2025, the deadline for applying for FAFSA is June 30th, 2025. While it is preferable to apply for university first and then do an FAFSA application, one can apply for FAFSA before applying for any college application. The sooner you apply, the better! You can use the following link to create an FSA account and apply for FAFSA: https://studentaid.gov/.
   3. Explore Scholarships: Look for scholarship opportunities, including those specifically designed to support you based on your identity. For BIPOC students, for example, organizations like the Thurgood Marshall College Fund and the Point Foundation offer scholarships to help ease financial burden.

Remember, by staying proactive, you can navigate the financial aid process with confidence. Invest in your educational and financial well-being and apply for FAFSA today!

Still have questions? NYLAG Financial Counselors can answer FAFSA and student loan questions, empowering you to make informed decisions about your college education.

• If you are currently working with a NYLAG financial counselor, reach out to them now to discuss your options. 
• Connect with a NYLAG financial counselor.