Why it’s a great time to be a student from a financial aid perspective

From a financial perspective, it’s a great time to be a student.  Economic woes and resulting layoffs have made full-time jobs harder to come by. Although tuition at most institutions nationwide is expected to rise, recent financial aid legislation has increased the availability of student financial aid.

The Good News:

• Eligibility requirements for the Federal Pell Grant have expanded to allow more students to receive Pell funding for the upcoming year.  In addition, the maximum Pell Grant has increased by $619.
   
• The maximum Washington State Need Grant to needy Western students will increase by $614 annually, from $4,416 in 2008-2009 to $5,030 in 2009-2010.

• The Federal educational tax credit, renamed the “American Opportunity Tax Credit” (previously the “Hope Tax Credit”) will increase from a maximum of $1,800 to $2,500 per year to help offset the cost of college tuition and other expenses.

• The interest rate for Federal Subsidized Stafford loans made to undergraduate students is fixed rather than variable, and is scheduled to incrementally decrease in accordance with a specific disbursement schedule from 5.6% for loans first disbursed July 1, 2009,  to 4.5% on loans disbursed on or after July 1, 2010, and down to 3.4% effective for loans disbursed from July 1, 2011 to July 1, 2012.

• Annual loan limits for Federal Unsubsidized Stafford loans increased by $2,000, effective July 2008, and the interest rate is fixed at 6.8%, rather than variable.

• Veterans benefits have expanded as has the availability of specific tuition waivers that apply to veterans and their families.
   
• Prepaid tuition plans are no longer considered estimated financial assistance. This means that the proceeds from these plans do not reduce financial aid eligibility on a dollar for dollar basis. Further, if the owner of the account is a dependent student, the value of the account is excluded as an asset for financial aid purposes.

Did you know that approximately two thirds of Western students receive some form of financial aid?  Last year, the Financial Aid Department administered over $90 million in aid received by 8,652 Western students through grant, scholarship, student employment, and loan programs.

You must file the FAFSA (Free Application for Federal Student Aid) to be considered for most federal, state, and institutional need-based aid programs. Filing is free!  Significant opportunities remain to receive financial aid.   So if you have not done so already, complete the FAFSA on line.  Contact Western’s Financial Aid Department if you need help.

Financial Aid staff members are well aware that for many families, calendar year 2008 income reported on the FAFSA is no longer representative of a family’s relative financial need.  If you have suffered a loss in employment income, you should contact a financial aid counselor, who will determine whether it is possible to recalculate and thereby increase your aid eligibility, using your projected year income.

A Few Tips:

• Always file the FAFSA to determine federal loan eligibility before considering a private educational loan.  Interest rates on Federal loans tend to be lower than rates through private lenders.  In addition, by virtue of having filed the FAFSA, you will be considered for a whole host of other aid programs, as well.
   
• Although some scholarship organizations require the FAFSA to be filed before considering students for scholarships, a separate scholarship application is typically required.  Scholarship application processes are usually free. Carefully research any scholarship organization that charges a fee, as this is a relatively unusual practice.  For more information, visit the Financial Aid Scholarship Center website.
   
• Research shows that most students who work less than half-time while attending school perform better academically than students who do not work.  Further, students who work learn how to better manage their time.  There are many opportunities for work on campus. Students are not required to be eligible for a work-study program to find a part-time job.  As a matter of fact, most part-time student jobs on campus are simply regular, non-work-study positions.  For more information, visit the Financial Aid Student Employment Center.
   
• Eligibility for veterans benefits and consideration for tuition waivers for veterans and their families is administered through Western’s Registrar’s Office.
   
• Students can be considered for financial aid to cover child care expenses incurred as a result of attending Western.  If you have filed the FAFSA and have not yet provided documentation of such child care expenses, contact the Financial Aid Department for more information.
   
• If you can, leave your car at home! Bellingham has an excellent bus system. By using the bus pass provided via the $25/quarter transportation fee, your student could forego the high costs of gas, car maintenance, insurance, and parking.

Congratulations on your decision to earn a baccalaureate degree.  College remains a great investment, personally and professionally.  Research conducted by the College Board and the U.S. Census Bureau shows that college graduates can expect to make an average of $1 million more over their professional lives than their high school graduate counterparts.
 

During 2007-2008, 54% of Western graduates borrowed an average of $15,765 through educational loan programs, resulting in an estimated monthly loan payment of approximately $200 per month; this is less than a typical car loan.

Paying for college expenses takes planning and a certain amount of sacrifice on the part of students, as well as their families.  We encourage you to become familiar with the Financial Aid Department and maximize the benefit you can receive from the financial aid programs that Western offers.