Student financial aid in the United States is funding that is intended to help students pay education-related expenses including tuition, fees, room and board, books, and supplies for education at a college, university, or private school. General governmental funding in the form of subsidies for public education is not called financial aid. Financial aid refers to awards to specific individual students. Certain governments, e.g. Nordic countries, provide student benefit. A scholarship is sometimes used as a synonym for a financial aid award, although grants and student loans are also major components of financial aid packages from students' intended colleges. The United States government and all U.S. state governments provide merit- and need-based student aid including grants, work-study, and loans. As of 2010 there are nine federal and 605 state student aid programs and many of the nearly 7,000 post-secondary institutions provide merit aid. Major federal grants include the Pell Grants, Federal Supplemental Educational Opportunity Grants, Federal Work-Study Program, federal Stafford Loans (in subsidized and unsubsidized forms), state student incentive grants and Federal PLUS Loans. Federal Perkins Loans are made by participating schools per annual appropriations from the U.S. Department of Education. Federal Stafford Loans and Federal PLUS Loans are made by the U.S. Department of Education. As of April 2010, Congress voted to eliminate the Federal Family Education Loan Program (FFELP) which had allowed private lenders to make student loans guaranteed by the federal government. State governments also typically provide some types of need- and non-need-based aid, consisting of grants, work-study programs, tuition waivers, and scholarships. Individual colleges and universities may provide grants and need- and merit-based scholarships. Students requiring financial aid beyond what is offered by their institutions may consider a private (alternative) education loan, available from most large lending institutions. Typically, education loans obtained through the federal government have lower interest rates than private education loans. Institutions may also offer their own student financial assistance, in the form of need- or merit-based aid, as well as endowed scholarships (with varying need and/or merit-based criteria). Some institutions may only require the FAFSA; some may also require a need-based analysis document, such as the CSS/Profile, to apply for such funds to apply a more stringent need analysis for the rationalization of institutional funds. There are several misconceptions surrounding financial aid: It is sometimes said that students shouldn't apply for financial aid unless they have already been accepted and are declared to the university of their choice. The FAFSA papers are transferable to most universities, and it can be advantageous to begin the FAFSA papers during the application process. Some schools have their own papers about home equity and other topics that they require students to attach along with the FAFSA papers. A second misconception about financial aid is that it is only available to the most needy students. Although it is often need-based, many different students qualify for the government's yearly $125 billion financial aid money. Funds can be won through strong grades, athletics and other talents, whether the student is poor or wealthy.[12] A further misconception is that students qualify for the same financial aid at every institution. Rather, aid varies from university to university like tuition costs. This does not mean that if the tuition is greater in one university the financial aid available will be lower. It is often the case that, because of the aid they provide, more expensive universities can be more affordable than those with lower tuition. Finally, it is not the case that US citizens are the only individuals that qualify for financial aid. A non-citizen can qualify for financial aid if they have a green card or a permanent citizenship. Further, parents' citizenship does not effect whether one can apply for financial aid. http://en.wikipedia.org/wiki/Student_financial_aid_in_the_United_States

• published: 06 Sep 2013
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