Your Financial Aid Award Explained

Copied from https://bigfuture.collegeboard.org/pay-for-college/financial-aid-awards/your-financial-aid-award-explained

Your award probably consists of a combination of gift aid, loans and a job. Each of these is very different from the others. Understanding the differences is important.
You need to know what you have to do to continue receiving financial aid from year to year, and how your aid might change in future years. Plan your finances now, so you can complete your degree on schedule.

Gift Aid Is the Best Form of Financial Aid

You don't have to repay it or work for it. Gift aid can be a scholarship, a grant, or other assistance, such as a tuition waiver. Questions to ask:

• What do I have to do to keep my scholarship?
• Is there a minimum grade point average (GPA) or other condition?
• Do I have to do anything more than maintain satisfactory academic progress?
• Can I expect to receive the same assistance each year I’m in college?
• What happens to my aid if I win an outside scholarship?
• Can the aid be increased if my family has financial problems?

Loans Must Be Repaid

If your student loan is based on need, it is subsidized. This means you don't have to pay the yearly interest while you're in college. However, after you leave school, your payments include the amount you borrowed plus interest.
Unsubsidized loans aren't based on need. These loans require you to make yearly interest payments.

Questions to ask:

• What are the terms of my loan?
• Is the yearly interest paid by the government?
• What is the interest rate and when do I start repayment?
• How much will I owe by the time I graduate?
• How much is my monthly bill going to be when I graduate?
• Will my loan increase after my first year and if so, by how much?

A Job Is an Opportunity to Earn Money

If your package includes a job, also known as student employment or work-study, it means the aid office may help you find a position where you can earn the amount expected. Your earnings are most often used to pay education costs like books and personal expenses. Questions to ask:

• Do I have a guaranteed job or do I have to find one?
• How are jobs assigned?
• How many hours per week will I be expected to work?
• What is the hourly wage?
• How often will I be paid?
• Do I get paid directly, or is my student account credited?

Comparing Your Financial Aid Awards

Use the Compare Your Aid Awards tool to get a side-by-side comparison of your aid awards. Read about how to compare your aid awards and analyze your results.