Uncle Sam Ready To Help With College Costs

If you're a high school junior or senior, it's never too soon to start thinking about some kind of financial aid if you're considering college or career school. When thinking about the cost of higher education, many students - and parents - think scholarship first when it comes to footing the bill for college. But there are other ways to fund a college education. One of the best sources for financial aid is still good old Uncle Sam.

According to studentaid.ed.gov, a student aid gateway managed by the U.S. Department of Education, the Federal government remains the single largest source of student aid in America. Grants, work-study programs and loans - these are the three main student aid programs - pay out more than 80 billion dollars annually in aid to high school grads who believe they must learn more to earn more.

Having a basic grasp of the three types of aid available from the Federal government is an important precondition for filling out the FAFSA, or Free Application for Federal Student Aid. All high school grads must complete and submit their FAFSA application as part of the qualifying process for Federal student financial aid.

Student aid from the Federal government is available in three basic forms: grants, work-study programs, and loans. The types of financial assistance vary with respect to the amount of aid you may receive and whether or not the financial aid has to be repaid. Grants do not require repayment, nor do work-study programs, which pay an hourly wage or salary for work performed. Loans, however, must be repaid, just like a car loan or home mortgage, over a period ranging from 10 to 25 years.

There are several types of grant and loan programs within this general three-tiered framework of Federal financial aid. Many people have heard of a specific type of grant, the Federal Pell Grant, which is generally regarded as the foundation of the Federal student aid program. Other less well-known grants include the Federal Supplemental Educational Opportunity Grant (FSEOG), the Academic Competitiveness Grant (ACG), and the National Science and Mathematics Access to Retain Talent Grant, which is usually referred to as the National SMART Grant.

There are different loan formats, too. The direct Stafford loan, in which the lender is the Department of Education, is probably the best-known example of this type of Federal student aid. Based on the loan amount and the payment plan they select, recipients of a direct Stafford loan have between ten and twenty-five years to repay the government.

With only two exceptions, your financial need determines the amount of Federal student aid you can receive. The amount is calculated by subtracting your Expected Family Contribution, or EFC, from the cost of attending a college or career school. Using factors you supply on your FAFSA � including family income, family assets and benefits like unemployment and Social Security � your EFC is calculated according to a formula laid down in Federal law. The Federal government notifies you of your EFC on your Student Aid Report, or SAR. You'll receive your SAR once the government has processed your FAFSA application.

If all this sounds too intricate, the government has a number of extremely useful resources to help you cut through the clutter. One exceptional resource is the website mentioned at the beginning of this article, studentaid.ed.gov. Another is "Funding Education Beyond High School", a free 60-page guide available in PDF format at www.fafsa.ed.gov. Be sure to explore these resources as soon as possible during your senior year of high school in order to have the best possible chance of receiving Federal student aid.