The 5 Steps to Financial Aid

We get it. The financial aid process is confusing. It's hard to know what to do and when. These steps will help you through the process - from getting free money first to making sure you can pay your tuition bill.

Check out the five steps to pay for school and get started today.

Step One: Look for scholarships, grants, and other free money first.

You should try to get "free" financial aid first. Free financial aid is the type of aid that you do not need to repay. However, this type usually doesn't cover 100% of your costs, so you need to understand the types of financial aid available.

Your schools' financial aid offers will likely contain a combination of the following types of aid. Ideally, your offers include mostly free aid, then savings and low cost loans, with minimal alternative sources. However, your situation will be unique so be sure you understand all the aid types so you can evaluate your schools' financial aid offers carefully.

To be considered for most types of aid, you must complete the FAFSA (Free Application for Federal Student Aid).

Types of financial aid

Free Aid	No repayment is required, as long as you continue to meet all obligations. Includes scholarships, matching programs, grants, and work-study programs. Sources include the federal government, your state, your school, or additional resources such as your employer, community, or religious organizations.
Savings	Money you already have. Includes savings accounts, 529 plans, pre-paid tuition, or other savings plans.
Low-cost Loans	Federal loans are available for undergrads, grads, and parents. These loans offer reduced rates, generous repayment options, and no prepayment penalties. Your school may offer institutional loans and flexible tuition payment plans.
Alternative Sources	Alternative loans can fill any gaps in funding after you have exhausted other aid types. Home equity loans and lines of credit can be used in the right situations. Avoid measures such as cashing out insurance policies or retirement funds or using high interest advances on credit cards. These sources are almost NEVER a good idea.

Take action

• Search for scholarships at EducationPlanner.org.
• Learn about the Pennsylvania State Grant, work-study, and special programs.
• Learn more about FAFSA deadlines.

Did you know?

• Educational tax incentives like the Hope credit, Lifelong Learning credit, and student loan interest deduction can save you thousands.
• Beware of educational loan offers that seem "too good to be true." While you may get the funds easily, you may pay more later through high interest rates and prepayment penalties.