Resources for College Education

It’s graduation season, and that means many seniors and their families are focusing on post-secondary education now more than ever. Unfortunately, a college education is usually costly and understanding how to pay for it is difficult.

Luckily, Abbi Parcher, who recently joined First Security as a Public Relations and Marketing Specialist, has some expertise in the area. She graduated from the University of Northern Iowa in 2022 and was an Admissions Counselor for another local college. She has hands-on experience with the financial aid process, both as a recipient and as someone that assisted others in applying for it.

The Free Application for Federal Student Aid (FAFSA)

For other types of aid, a student must submit the FAFSA annually. This application is what colleges and the US government use to determine how much a student will get in financial aid.

“Many don’t realize that the FAFSA is not just for loans,” mentioned Abbi. “When you apply, the government calculates a Student Aid Index (SAI) number for you. That number is then used to determine award amounts and award types. These include loans as well as work-study or grant options.

Scholarships

Scholarships are one of the most coveted ways to pay for education because it’s money that doesn’t need to be paid back. They are usually based on academic or other achievements, though some consider financial need.

“If you’re looking into scholarships, I’d start by asking your high school guidance counselor about local ones that businesses, churches, and organizations may offer,” stated Abbi. “You can also contact the financial aid office at the university or college you plan to attend.”

Below are resources for the three public universities in Iowa and their scholarship opportunities: 

University of Northern Iowa

• UNI Scholarship Information

University of Iowa

• U of I Scholarship Information

Iowa State University

• ISU Scholarship Information

“Be sure to pay attention to what kind of criteria each scholarship application is looking for and apply for as many as you can!” said Abbi.

Student Loans 

Loans are available to everyone that completes the FAFSA, though the amount and type of loan will vary. Some loans are more desirable than others.

Subsidized Loans

These loans are taken out in the student’s name, and they do not accrue interest until the student graduates or drops out. In 2023, the interest rate for these loans was about 5.5% (source: studentaid.gov). There is a 6-month grace period to begin repayment on these loans following graduation or dropping out.

Unsubsidized Loans 

These loans are also taken out in the student’s name. However, unsubsidized loans accrue interest as soon as they are taken out. This means that they accrue interest while the student is in school, and they will continue to accrue interest beyond graduation or if the student drops out. In 2023, interest rates for unsubsidized loans were about 5.5% (source: studentaid.gov). There is a 6-month grace period to begin repayment on these loans following graduation or dropping out.

Parent PLUS Loan

The Parent PLUS Loan is taken out in the biological or adoptive parents’ name. It is a credit-based loan, meaning any adverse credit history will affect the ability to qualify for the loan. The school considers how much other financial aid has been earned and then will determine how much to allocate. Repayment on this loan begins right away, but parents can request a deferment until after their child graduates. For the 2022-2023 school year, interest rates for this loan were 8.05% (source: studentaid.gov).

“Sometimes, there will be a surplus in funds in comparison to what you receive vs. what you owe in tuition and other expenses, and your school will write you a check for that amount or else deposit directly into your bank account,” commented Abbi. “You can then keep the money, or if it’s not needed, you can use that money to make a payment on your student loan.”

Work Study

Work study is another viable option that students may be eligible for after submitting the FAFSA. Work study involves taking on a part-time job on campus to pay down tuition. There are a variety of options. They could range from working as a cashier at the school bookstore or working part-time as a janitor.

“Work study is different from a regular part-time job because it’s a rule that employees are students first,” said Abbi. “They must accommodate a student’s unpredictable schedule, as it changes at least twice a year with the new semester. A student may make more money in a non-work study job, but the flexibility work study provides might be more valuable.”

While work study is a good option, jobs may be limited, and students are often responsible for finding a job that is qualified. Work study is also not guaranteed each year.

Grants

Like scholarships, grants are one of the more desirable forms of financial aid because they do not need to be paid back. They are distributed based on exceptional financial need (students with a lower Student Aid Index number). One such grant is the Pell Grant, named after Senator Claiborne Pell of Rhode Island, the chief sponsor of the program. Since the 1973-1974 school year, the Pell Grant has aided students in their secondary education. In the 24-25 school year, the maximum Pell Grant amount is $7, 395. (source: studentaid.gov). This amount is based on the previously mentioned Student Aid Index.

The state of Iowa also has a grant available to residents. This grant is also based on exceptional financial need, and in past years, the common maximum was $7,500 (source: educate.iowa.gov). Qualifications include being a resident of Iowa, attending an eligible Iowa university, having an eligible SAI number, and submitting the FAFSA by July 1st each year. Usually, Iowa residents who qualify for any amount of the Pell Grant will qualify for the Iowa tuition grant as well. 

As mentioned above, to be considered for some financial aid, the FAFSA must be submitted by different deadlines.

“In my experience, the sooner you submit the FAFSA, the rest of the process goes more quickly,” stated Abbi. “You will get a more accurate estimate on what college expenses will be. That way, you can plan better and spend more time focusing on the fun parts about choosing a college.”

Final Advice 

Abbi has some final advice for graduating seniors.

“Don’t let representatives during college visits redirect your conversations and questions away from important topics like finances or safety. Go prepared with questions you want answered and request to speak personally and directly with the person who can answer them. That way you can walk away from your visit knowing all your concerns have been covered.”

With questions answered and financial aid options researched and planned for, students can embark on this new chapter in their lives with greater confidence and less stress. When young adults have financial security at their back, they can focus on the parts of college that they are there for: growth, education, learning about yourself, and flourishing into a well-rounded adult.