Higher education often costs more money than people can afford up-front. Sometimes, people have money saved to help pay for these big expenses. Other times, they take out loans. Many people, however, hope to receive some money from a government agency, charity, nonprofit organization, or university fund to help them make these expensive payments. This is called financial aid. Most often, we hear the term "financial aid" in regard to higher education, though it can also apply to other needs.
Filling Out a FAFSA
The first step to receive financial aid is to apply. The FAFSA, or Free Application for Federal Student Aid, requires you to disclose your financial information, ranging from your annual income to your level of debt, your assets (valuable things you own in full like a car, a house, or investments like stocks or bonds), and this same information for your spouse or parents (if you are a dependent, meaning your main source of revenue is from them). Essentially, the provider of the financial aid wants to ensure that you have a genuine need for the aid and will be doing something constructive with it. When applying for financial aid, therefore, make sure you have all identification and financial paperwork ready.
Gaining Approval
The approval process for financial aid may be time-consuming and involve background checks and contact information for supervisors or college advisers. If any dishonesty is detected, you could lose your financial aid. Financial aid may not be granted to those with criminal records or excessively poor credit scores. Even if your background is far from perfect, make sure you disclose everything honestly: Those who are found to have lied on their financial aid applications may be forced to pay the money back later.
Limited Spending Options
Money received from financial aid often does not come in the form of cash. For college tuition aid, it is common for the money to be sent directly to the school in your name. It is relatively rare for financial aid to be distributed in a form that allows the recipient to spend it freely, and even money provided directly may come with requirements for formal accounting, meaning you must report back what you purchased with the money. Financial aid for college students that allows for living expenses, for instance, may require the student to submit an account of those expenses.
Reapplication
Reapplying for financial aid can require rigorous accounting of what you spent your previous financial aid money on and how much progress you have achieved toward your goal, be it finding employment or gaining college credits. In terms of college financial aid, students' reapplication for aid may be denied if the student cannot show that he or she is earning an acceptable number of credits toward graduation.
