There are two types of financial aid: need-based aid and merit-based aid. Need-based aid is money from the federal government or college that is distributed based on a student's calculated financial need. Merit-based aid is distributed by higher education institutions or other sources based on their own criteria of merit, including academic and athletic accomplishments.

The type of aid ACCESS primarily deals with is need-based aid. Financial need is calculated by higher education institutions primarily through three forms: the Free Application for Federal Student Aid, or FAFSA, the CSS/Profile, and institutional financial aid forms.

Types of Need-Based Aid
There are three basic types of need-based aid: grants, work-study, and loans. Grants are free aid and do not have to be paid back. Think of them as free money. Work-study is money earned by working part-time on campus. Think of it as earned money. Loans are funds students or parents borrow that must be paid back, usually after the student leaves college. Think of them as borrowed money. To read more about specific types of grants, work-study, and loans, click here.

How to Get Financial Aid
The most essential step in applying for need-based aid is to fill out the FAFSA. This form is free and can be filled out with a paper application or online at www.fafsa.ed.gov. Filling out the FAFSA makes students eligible for federal aid, most of which is need-based. Based on the information provided on the FAFSA, the Expected Family Contribution, or EFC, is calculated. Colleges use the EFC to determine how much financial aid students will receive.

Some private colleges may require students to fill out the CSS/Profile. This form costs $25.00 for the first school that requires it and then $16.00 for each additional school. Colleges may also send students information about institutional financial aid forms that must be filled out and sent directly to the colleges.

This process is designed to evaluate a family's ability to pay for educational costs, recognizing that families have a responsibility to contribute to students' education but also that special circumstances may affect families' ability to pay.

You can find out more about these forms and the financial aid process by consulting Applying for Financial Aid.

Financial Aid Myths
There are many myths about financial aid and college affordability. Here are some of the most common misconceptions--and the realities behind them.

Myth: Only the very rich can afford college.
Reality: Nearly 20 percent of traditional-aged undergraduates come from families with income below $25,000 per year. The federal government, states, and institutions all offer financial aid to help low-income students afford college.

Myth: Only big-time athletes get scholarships.
Reality: In 1999-00, less than 1 percent of undergraduates received athletic scholarships. Most student aid is awarded on the basis of financial need -- not athletic talent.

Myth: It actually hurts you to save for college because you get less financial aid.
Reality: Those who save will be expected to contribute more toward their children's education than those who do not save. However, the formulas for determining the expected family contribution count income far more heavily than savings, so the difference is usually not substantial. Furthermore, a family that saves will have the funds necessary to meet their expected contribution, while a family that does not save may have to borrow -- with interest charges more than making up for the smaller expected contribution.

Financial Aid Tips From ACCESS Staff
"First, students should find out who their ACCESS advisor is at their school and schedule an appointment as soon as possible. I would also advise students to encourage their parents to learn more about the financial aid process because a lot of parental information is needed to apply for financial aid. Lastly, I would tell students not to be discouraged by the paperwork of the financial aid process, because it is not as complex as it looks and with the help of an ACCESS advisor, they will be one step closer to their higher education dreams!"
-Jerry Henry, Program Director

"Start the process as early as possible. Identify people and organizations such as ACCESS who are here to help. And of course, search for outside scholarships as early as possible as well."
-Holly Morrow, Financial Aid Advisor

"Make sure that you make the decision of where you attend college based not on only the institution itself, but also how the cost of it will affect you down the road."
-Claire Dennison, Manager of Postsecondary Success