What is Need-Based College Financial Aid?
Need-based financial aid is reserved for families who do not have the available financial resources to cover the costs of higher education. The United States government devised a formula to calculate financial need for education called Expected Family Contribution (EFC).
More About EFC
Expected Family Contribution compares total family income, assets, and size to the tuition cost of the institution a student plans to attend. EFC also considers the length a student will attend the institution, and whether he or she will be a full- or part-time student.
To calculate EFC, applicants must fill out a Free Application for Federal Student Aid (FAFSA). This application determines ones eligibility for various types of financial aid.
Need-Based Financial Aid
There are three main ways to receive need-based financial aid for college. Applicants must fill out a FAFSA to determine eligibility for each of these programs.
More About EFC
Expected Family Contribution compares total family income, assets, and size to the tuition cost of the institution a student plans to attend. EFC also considers the length a student will attend the institution, and whether he or she will be a full- or part-time student.
To calculate EFC, applicants must fill out a Free Application for Federal Student Aid (FAFSA). This application determines ones eligibility for various types of financial aid.
Need-Based Financial Aid
There are three main ways to receive need-based financial aid for college. Applicants must fill out a FAFSA to determine eligibility for each of these programs.
- Federal Pell Grant - A Federal Pell Grant is a need-based scholarship program in which recipients are not required to repay funds. A majority of Pell Grant recipients have an EFC less than $30,000.
- Federal Work Study Program - Students who qualify for a work study program must attend school and work at an approved job on or off campus. Income cannot exceed the amount provided by the Work Study Program. Like a Pell Grant, funds afforded by Work Study do not have to be repaid.
- Federal Perkins Loan - This program is a federal loan given to students with the greatest financial need. Perkins loans offer longer grace period and fewer fees than other student loans. Principal payments are deferred until nine months after graduation.
