Affording College: financial aid comes with consequences for students

Patricia Katri/Staff Writer

 

According to the College Board, anxiety about the financial aid system and college finance is on the rise and climbing. While some students may opt out of taking loans, others may not have a choice.

“Rapid changes in college enrollment and in the resources available to pay for higher education produced tremendous anxiety about the financial aid system and the general problems of college finance,” the College Board stated on its website. “Current perceptions of college affordability, student aid and student debt are, to a great extent, outgrowths of the financial crisis of 2008 and the ensuing recession,”

Opting for financial aid is a decision that may depend on the state of the economy.

“Despite [economic improvements], significant financial strains remain for student and families, for colleges and universities, and for the federal and state budgets on which we rely to fund significant portions of the cost of higher education,” the College Board wrote.

Here at the University, several types of aid are available. According to FIU’s financial aid website, grants, employment, and loans are offered.  Funds can come in the form of federal, state, institutional or private aid based on students’ financial need and availability of funds.

This year, several changes in financial aid processing have taken place, mainly affecting the Free Application for Federal Student Aid.

FAFSA, which is administered by the U.S. Department of Education, provides more than $150 billion in student aid each year for higher education purposes and helps determine how much financial support a student qualifies for.  

Now, college-bound high school seniors and current college students can file their FAFSA as early as Oct. 1 for the 2017-2018 year, three months earlier than the previous initial date of Jan. 1. Additionally, students can use income information from an earlier year, which will simplify the application process.

There are advantages and disadvantages to every type of aid. Scholarships, for example, don’t need to be repaid but may require lengthy application processes and that certain SAT and GPA requirements be met and maintained. But unlike federal aid grants, for instance, they can be need-blind.

“Some students assume that scholarships are primarily designed for students who are in dire need of financial assistance” the website Scholarships.com states. “This is not the case; in fact, winning a scholarship will be beneficial to any student for several years following their receipt of the award. If you are on the fence about applying for scholarships and unwilling to commit your time to the process, consider [the] significant benefits before you miss your opportunity.”

Loans can be the most complicated form of aid and taking them out can be difficult for students, as they contemplate the prospect of going out in the adult world in debt.  Still, there can be advantages.

“I am not eligible for a Pell grant, I understand there’s a reason but I believe that just because my parents make a certain amount of money, it doesn’t mean that they could pay out-of-pocket for me to attend college,” said sophomore psychology major Destiny Medina. “I have a big family so that’s a factor, but [financial aid] is still helpful to those who need it.”

The website GoCollege.com offers advice to students contemplating loans.

“Any loan is a serious commitment, and should not be entered into lightly. Having said that, student loans are often necessary to make it possible for a young person to fulfill their college dreams,” GoCollege.com stated.

GoCollege goes on to say that student loans can be more manageable than other types of loans, often offering special terms and provisions.

“Most student loans offer lower interest rates, deferred payment options and a repayment grace period following graduation,” GoCollege.com affirmed. “Student borrowers can also take advantage of more lenient repayment plans and schedules that are exclusive to education loans, and unlike the more restrictive terms and conditions of a standard loan.”

Students who take out loans echo out these pros and cons.

“I receive financial aid, mostly in the form of loans,” said Medina. “The assistance I get is beneficial in helping me pay for things like tuition and fees which I can’t readily pay out of pocket. However, the couple of downsides to financial aid is the extent to how much I am given and the fact that because my parents, combined, make a certain amount of money. “

Senior engineering major Alexander Durant found an alternative to financial aid to pay for college:

“I have no financial aid nor student loans,” Durant said. “I’ve worked and paid for college, but it did affect my GPA, which [may hinder] starting a career at a big company.”

 

Image by Tax Credits, retrieved from flickr: 

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