10 More Financial Aid FAQs
With financial aid season in full swing, we've been receiving plenty of questions from students and families on the topic. We recently posted 10 of our frequently asked questions about financial aid, and today we're here to provide answers to 10 additional questions. The topics covered below are a bit more obscure than our first set, but still ones we've discussed with families and students over the past few weeks. Browse the list to see if your family can benefit from any of the information below.
What is a typical work-study job? And what are the hours?
Work-study is a financial aid work program with funding provided by the federal government and colleges. Work-study jobs typically take place on campus, and can range from checking in students at the gym to helping with administrative tasks in the admissions office to serving as a peer tutor. Some schools also offer work-study positions off campus in partner organizations. Students work with their employers to determine the number of hours they will work each week, but a typical student might work 5-10 hours per week, with modifications as necessary throughout the semester. Students may not work more than 20 hours per week.
Do I need to report my other real estate on the FAFSA if I'm using it as my retirement investment?
Yes, you must report any real estate that you own (other than your primary home) on your FAFSA, even if that real estate is intended to serve as your retirement account.
How does legal guardianship affect financial aid?
Any student in legal guardianship will indicate that status on the FAFSA, and as a result will not be asked to report any parent information on the FAFSA. On the CSS Profile, a legal guardian assumes the role of the parent, and answers all parent questions with his or her own information.
How does cashing in savings bonds affect financial aid eligibility?
If you haven't been paying taxes on your savings bond interest every year (most people don't) then you'll have to pay taxes on the interest in the year in which you cash in the bonds, and that interest will show as income on your federal tax return. Your income is taken into account when assessing your financial aid eligibility, so an increase in your income could affect the financial aid you're eligible to receive. As the cash-in is a one-time bump in your income, it's best to let the financial aid office know about it, and request that they exclude the amount from your income when determining your eligibility for financial aid.
What are average interest rates on private loans?
The interest rates on private loans can vary widely, and the interest rate offered is often based on the strength of your credit. Credible.com shows a variety of private student loan lenders, and interest rates on those loans can range anywhere in the neighborhood of 2-13%. If you're looking for a private student loan, check out a few different lenders to compare the rates offered to you.
Can I hide my financial information from my student?
Your student will have access to any of your financial information reported on the FAFSA. Keep in mind that if you use the IRS Data Retrieval Tool on the FAFSA, the numbers from your federal income tax return will not appear, though the FAFSA will still show any additional figures you report, such as the value of your assets. If you complete the CSS Profile under your student's College Board ID, your student will have access to your information. However, if you complete the Profile under your own College Board ID, your student will not have the ability to view the information you submit on the Profile.
How does my business affect my financial aid?
Any business income that appears on your personal tax return will be included in the Adjusted Gross Income that you report on your financial aid applications, which is used to determine your financial aid eligibility. As well, if you have ownership in a business with income that doesn't carry over to your personal return, you'll need to report that to any schools that use the CSS Profile. If you own value in a business, you'll need to report that value on the CSS Profile. You'll only need to report it on the FAFSA if it's a large business that isn't owned by your family.
Can I make my child independent?
Students classified as "independent" on the FAFSA don't need to report any parent financial information to colleges. Students must meet certain criteria to become independent, and only under very extenuating circumstances, such as abuse or abandonment, can a student appeal to be considered independent without meeting that criteria. In most cases, if a student lives with or has an ongoing relationship with a parent, that student will be considered dependent on the FAFSA and will need to provide parent financial information on the financial aid applications.
Are student federal loans affected by parent credit?
No, students can receive Federal Direct Student Loans regardless of the strength of a parent's credit. Students need only to submit the FAFSA to be awarded those loans. Parent credit will not be checked.
How do transgender students complete the FAFSA?
The name and gender reported for a student on the FAFSA must match the name and gender on record with the Social Security Administration. If a student has not changed his or her record with the Social Security Administration, the student should report the name and gender assigned at birth on the FAFSA.
What's the purpose of the Save Key?
The Save Key within the FAFSA allows a student or parent to log into a FAFSA that has already been started by a family member in order to complete or sign it. The first person who begins a new FAFSA will be asked to create the Save Key. The save key is four to eight characters long and can contain any combination of numbers, uppercase letters, and lowercase letters.
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