Financial Aid and the FASFA

We are lucky to be considered independent student but for most students under 24, they are dependent students and the government expects their parents to contribute towards the cost of college.  This means that your parents income and assets are counted as well as your own.  It also means that most of your assets are expected to go towards college spending, not just your income for that year.
Before I go into what a dependent student should do to shelter money, determine if you are a dependent or independent student.

The Following Questions Determine If You Are An Independent Student

1. Are you 24 year of age or older?
2. Are you married?
3. Are you enrolled in a master or doctorate program?
4. Do you have children who receive more than half of their support form you?
5. Do you have dependents other than your children or spouse who live with you?
6. Are you an orphan or ward of the state?
7. Are you a veteran of the U.S. armed forces?

If none of these apply, then according to the federal government, you are a dependent student.  However, many medical programs still require you to include your parent's income and assets, which may be something to consider, if you are picking a medical school.
As a dependent student there are different rules than an independent student because the dependent student is expected to use most of his or her assets to pay for college but the independent student is not.

If you have been determined to be a dependent student, first be aware that the law has changed.  It used to be that if your parents refused to fill out the FAFSA, you were not eligible for any aid.  The federal government has figured out that perhaps that may not be right, since every student is eligible for unsubsidized loans regardless of income or assets.  Now you can fill out the FAFSA without your parent's income and assets and still get unsubsidized student loans.

But often that is not enough.  What to do?  If you are eligible for work-study, TAKE IT! Work study is the only work you can do that won't be counted against you for future aid.  Often you must accept work study NOW to get the good jobs on campus because for many universities, the good jobs go quick.  The other option is to ask your department if they have any jobs that can be paid via work study.  I was able to work in the statistics lab which improved my CV as an undergraduate because I had work study, normally the coordinator only took Master's students.

While you are there, ask about scholarships.  Our department had three $500 scholarships only for declared majors.  The biology department had more.  My community college had all the scholarships within the financial aid office, but neither of my universities (undergraduate or graduate) run scholarships through there.  But, don't assume, check with the financial aid office too. 

This is the time to apply for aid both loans and scholarships and prepare for next year, which includes applying for summer internships and jobs.  Don't wait to the school year is over, you will be behind.  So, everyone let's be about it.*  Post if you have other ideas for preparing for next year.

*A prize for the first person to who recognizes the series that quote was from and post it.

It's that time of year! Scholarship Time!

Sorry folks, I know you wanted me to say it was Spring Break Time, which it is but for your college career, scholarships are more important than spring break.  When I was in undergrad it was hard for me to apply for scholarships.  I felt that time could be used making money at my part-time job or studying.  Why work so hard to find these scholarships when chances were, I would not get them.  I did get pushed into apply for a few and I did not get them.  But, I am still applying now.  You may be asking why?  And why would I be tell you folks to do so?

There are a ton of scholarships out there and yes the chances are not great but the more you do, and the better you do, the better chance of landing AT LEAST one.  And, winning $500 is worth a lot of time, about 50 hours for a student.  So, tell me, have you spent 50 hours working on scholarships?  I know I have not.  I have two that I will be working on, one due in April and one due in December.  I have spent about seven hours on the one due in April and it is almost done.  Once it is done, I plan to find one more.

It is hard to get excited about scholarship because the reward does not often come through.  But it can.  I know of many people, my husband included who received them.  People are not tricking students, and they want students to apply.  So, I give you this challenge during Spring Break give yourself a 3-5 hours and find and work on a scholarship application.  Five hours will mean my scholarship application will done and I will have found a second.  Let me know in the comment if you plan to try for this challenge.

Updated Millionaire plan March 2014

This is my first update after starting my $625 per month retirement savings.  We did very well this month, with a bit of help from the market.  We now are at $17834.  Our next goal is $21,000 which includes all of our expenses for six months plus COBRA.  We are still $3,166 short but are getting close very quickly.  If the market cooperates with us we will be there in about five to six months, well within our goal of having six months by the end of 2014.  

Our goal after $21,000 is $25,000, the amount of my gross income, as well as the amount we need to stop using target date funds, and diversify on our own.  That will lower our investment costs, increasing the money we keep to invest.  If the market does not crash, it looks like we may be able to get up to that goal in eleven to twelve month (March 2015).  But who knows, maybe the market will help us more, and we will beat both of these goals in 2014.

But, right now we are not looking for extra money to up our retirement savings.  I am happy with 15% while I focus on other money goals, like building up an emergency fund.  Within this year my husband graduates with his PhD.  That means our very secure income, won’t be as secure.  Once you graduate, be ready for turbulence.  That is why I am saving a bare minimum for retirement and focusing on here and now.  We are building an emergency fund and paying off debt.  Once those are done, we will start pushing up our retirement savings again.