How Does Financial Aid Work? 4 Things to Know

Almost 20 million students attended school in the fall of 2019. That number dropped significantly during the COVID pandemic, but will likely recover once it’s over. 

The bad news is that while attendance has fluctuated, tuition costs have not. They’ve been rising over the years, and have become a real crisis for the current generation.

However, there is always financial aid, which can help ease the burden. How does financial aid work, though, and how much help does it offer?

The answer to that question is quite complex because there are several different factors at play. We’ll talk more about that in this article.

1. Assume You Qualify

Far too many people think they won’t qualify for financial aid when the truth is that most people qualify. Four out of every five college freshmen receive some kind of financial aid.

There are a number of ways to qualify for scholarships and financial aid. Even if you think you’ve done nothing, there’s a good chance you can get some sort of scholarship.

Some schools will even help you with your financial aid, including Grace Christian University. Give them a visit at https://gracechristian.edu/online to learn more.

2. Fill Out a FAFSA

How does financial aid work? It’s a simple process, all told, and it all begins with the FAFSA.

FAFSA stands for Free Application for Federal Student Aid. It’s a document that students entering college can fill out that helps determine how much financial aid you can expect.

This document will ask you a number of different questions, ranging from questions about you, your parents, and your current situation, to your experiences in school and any extra-curricular activities you participated in.

3. Student Loans

Financial aid is a catch-all term that actually describes many kinds of financial assistance. Chances are that most of your student aid will come in the form of loans. Student loans are money granted to prospective college students so that they can pay for their education.

Since these are loans, you will have to pay them back at some point. However, if you’d prefer not to have any bills to pay back after college, there are other types of financial aid.

4. Grants and Scholarships

Grants and scholarships are some other forms of financial aid, but they differ from student loans because you never have to pay them back. The downside is they’re not as common as loans, which is why it’s rare for someone to have their entire college paid for.

That being said, much of the reason that scholarships aren’t as common as loans are that they’re underutilized. Two billion dollars in grant and scholarship money goes unclaimed every year.

A lot of this money comes in the form of scholarships, sponsored by any number of groups for any number of reasons. You probably have a lot more options than you think.

How Does Financial Aid Work?: A Guide

So how does financial aid work? Financial aid isn’t too complex of a process. Remember to apply for grants and scholarships to offset the cost of college, and to do your research prior to signing with a lender. 

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