At first glance, the sticker price of any college might seem expensive, if not exorbitant. However, financial aid wipes away a substantial amount of that price. Thus, it enables college students to earn their degrees. It comes from several sources, such as:
- The federal government (approximately 73 percent)
- Colleges and universities (about 18 percent)
- State governments (about 5 percent)
- Several private organizations, e.g., companies, religious organizations (around 4 percent) and
- Banks and financial institutions
Financial aid comprises:
- Grants from the federal and state governments: They award grants based on the financial circumstances of the student. The student does not need to repay these.
- Scholarships from governments, colleges and private organizations: They provide grants based on the student’s skills and abilities in academics, sports, volunteer work, and so on.
- Loans from the federal government (low interest) or private lenders (high interest): Students need to repay these along with the interest component.
To receive financial aid, students must apply via the Free Application for Federal Student Aid (FAFSA). They must submit the FAFSA by January 1 of the year in which they plan to attend college.
Students could also apply for financial aid from the colleges they apply to or other financial institutions. Some institutions require applicants to submit forms such as the CSS/Financial Aid PROFILE. The relevant authorities award financial aid based on the details submitted in the application form.