Financial Aid
Money provided to students to help pay for college, including grants, scholarships, work-study, and student loans.
What is Financial Aid?
Financial aid refers to funds provided to students and their families to help cover the cost of higher education, including tuition, fees, room, board, and books. It falls into four main categories: grants and scholarships (free money that does not need to be repaid), work-study programs (part-time campus employment), and loans (borrowed money that must be repaid with interest). Federal aid eligibility is determined through the FAFSA (Free Application for Federal Student Aid), which calculates the Student Aid Index (SAI) based on family income, assets, and household size. Aid packages combine multiple aid types, and institutional aid from the college itself is often the largest component.
Example
A student attending a $55,000-per-year private university might receive a financial aid package consisting of a $20,000 institutional grant, $6,895 in federal subsidized and unsubsidized loans, and a $3,000 work-study allocation — reducing the effective cost (net price) to approximately $25,000 before family contributions or private scholarships.