The competition for aid increases when the economy is weak. Those who plan ahead for the aid process will do much better than those who procrastinate and miss deadlines.
For example, if you have lost your job, avoid dipping into your retirement plan. In addition to the likely early distribution penalties and additional income taxes, the higher income will reduce your aid eligibility.
Applying by the priority deadlines, even if you think you won’t qualify, will help you if your finances take a turn for the worst. Some schools will only accept requests for reconsideration due to a decline in income from those students who filed for aid on time – even if they were turned down initially.
Many colleges-especially the private ones-have increased their aid budgets to attract applicants whose families are now more price-resistant given the state of the economy. Have a financial aid back-up plan, such as applying to a public institution in your home state, or any school where the student can live at home instead of paying for room and board.
You can save on costs if the student attends a community college for two years and then transfers to a pricier school for his or her remaining two years. However, be sure that the college to which the student plans to transfer will accept the credits from the community college.
High scores on AP exams can help you save on college tuition. Many colleges award course credits for them, which can reduce the amount you need to pay.
If you exceed the school’s admission criteria, you are much more likely to get a better aid package than a marginal applicant. Increasing standardized test scores is a simple way to make your application more competitive.
Take into account starting salary information amongst grads from your chosen school, or in your planned career path.
Avoid private loans at all costs.
But expect that the college may require considerable supporting documentation.
After all, a dollar you can save on your taxes is worth the same as getting an additional dollar in grant or scholarship aid.
This debt is more expensive than ever, given the recent changes to interest rates and other fees that many card issuers are now charging. You also want to be sure you avoid maxing out on your borrowing limit, just in case you need to use the card to pay for an unexpected emergency.
Source: The Princeton Review