DRAFT 1

Financing a University Education

CSU-UC Joint Counselor ConferenceSeptember 2013

DRAFT 2

• Help is available!• Federal grants• Student loans• State grants• University grants

• Both UC & CSU enroll a large number of low-income students, few of whom pay the “sticker price” - concentrate on the “net price” instead!

California Students Can Afford College

• Parent loans• Private and State scholarships • Part-time work• Higher education tax credits

DRAFT 3

How to Apply• It takes two!

• File the FAFSA OR California Dream Application• High school or student file Cal Grant GPA verification form

• March 2nd is the priority deadline• FAFSA & Dream Applications available beginning Jan 1• Student and parent can sign the FAFSA with a federal

“PIN”• California Dream Application also allows the student and

parent to sign the application electronically

DRAFT 4

• Respond immediately to all requests for follow-up documents and actions, including those from both the financial aid and admissions offices

• Find out how the college will communicate with the student – many rely on student checking their email and on-line portals for document requests, other action, and award notices

• Families should hear about their award in time to make an informed decision PRIOR TO THE DATE on which university asks them to commit (often May 1 for freshmen and later for transfers)

What Happens Next

DRAFT 5

Financing College is a Partnership

Students contribute through working and borrowing Parents are asked to contribute based on their financial strength

Low-income parents often asked to contribution zero Some students are “independent” of their parents – 38% at

the CSU (over age 24, dependents of their own, etc.) Universities pull together financial aid for students

Offer a combination of federal, state, and university grant and scholarship to eligible students

Assist families seeking loans to help meet their contribution

DRAFT 6

Working and Borrowing• All student seeking financial aid at CSU and UC are expected

to work part time and to borrow reasonable amounts that result in “manageable” student loan debt.

• A work study job as well as other jobs on or off campus are both roughly equivalent ways that students can contribute to their support from earnings.

• Working more than half time while enrolled full time is associated with declining academic performance.

DRAFT 7

CSU UCMany students work at least half time and enroll less than full time

Most students work half time or less and enroll full time

Sticker price is about $6,500, but the average net amount paid by undergraduates is about $3,100

Financial aid reduces price differential between the cost of CSU and UC for grant recipients

At CSU, average student loan indebtedness for 2011 graduates was about $16,648 (about $191 per month for 10/yrs)

At UC, average student loan indebtedness for 2011 graduates was about $19,751(about $228 per month for 10/yrs)

Typical time-to-degree for entering freshman is 5.6 years.

Typical time-to-degree for entering freshman is 4.2 years

Typical time to degree for entering junior transfer student is 3.4 years

Typical time to degree for entering junior transfer student is 2.3 years

DRAFT 8

Costs of Attending CSU and UC 2013-2014California State University

2013-14 At HomeOn

CampusOff

Campus

Fees $6,633 $6,633 $6,633Books &Supplies 1,682 1,682 1,682Room &Board 4,453 11,648 11,798

Transp. 1,353 1,188 1,390

Personal 1,338 1,338 1,338

TOTAL $15,458 $22,488 $22,840

Most families do not pay the “sticker price”

University of California

2013-14 At HomeOn

CampusOff

Campus

Fees $13,222 $13,222 $13,222

Books &Supplies 1,505 1,505 1,505

Room &Board 4,470 13,788 9,661

Personal & Transp. 3,517 2,223 2,999

Health Ins. 1,435 1,667 1,728

TOTAL $24,149 $32,405 $29,115

DRAFT 9

CSU and UC are Affordable For families paying “full sticker price,” per year, CSU is on average $8,691 less

for commuters, $9,917 less for students living on our campuses, and $6,275 less for students living off campus, but not with family. This annual cost differential between CSU and UC may be slightly less for financial aid recipients. UC budgets also include around $1,600 per year for student health care. Most of this amount is for health insurance; UC students can waive out of paying for UC student health insurance if they are covered under a non-UC policy.

UC expects full-time enrollment and part-time work; CSU is more flexible

About half of undergraduate students take out student loans at UC and CSU Public institutions in California are the best educational bargains, especially

for low-income students Most students enrolled in private colleges and universities take out student

loans and graduate with higher average student loan debt than students who graduate from public institutions, no matter the time to degree or other factors!

DRAFT 10

Federal Education Tax Credits• To the extent that students or their families pay their tuition,

certain required fees, qualified books and supplies out of their own pockets (without grant or scholarship), they may apply for a federal education tax credit of up to $2500 on the first $5000 that they pay out of pocket.

• A tax credit reduces the amount of taxes owed!

• Rather than wait for an income tax refund, families eligible for the federal American Opportunity Tax Credit can reduce the amount that is withheld incrementally each pay period so that they have the extra cash when they most need it to pay college expenses.

DRAFT 11

BLUE AND GOLD at UC• Undergraduate California residents who file FAFSA or

DREAM applications on time and are determined to have total family incomes under $80K per year will not have to pay UC’s systemwide tuition and fees ($12,192 in 2013-14) out of their own pockets for the first four years (two years for transfers) that they are enrolled at UC.

• Eligible students may qualify for additional grant support to help pay for other college expenses, but they will not get less than an amount equivalent to the systemwide tuition and fees.

DRAFT 12

California DREAM Application

• https://dream.csac.ca.gov/• Must be eligible for AB 540 status, even if AB 540

certification has not been completed at the time of application

• Males must have registered for the Selective Service before age 26

• DACA eligibility doesn’t play a role; DACA SSN is not used for any purpose other than work

• Student or parent may be required to verify income, even if taxes have not been filed

DRAFT 13

Middle Class Scholarship – “MCS” at CSU and UC

• A new state-funded scholarship for CA residents and DREAMers from families with “total” incomes up to $150K

• Students must file a FAFSA/DREAM Application by March 2• Does not require student to have financial need• MCS will cover between 10% up to 40% of systemwide

tuition and fees – percent varies with total income • In 2014-15, maximum MCS awards at CSU could be up to

$766 and at UC up to $1700 per student• The MCS award will be reduced by any Pell Grant, Cal Grant,

CSU State University Grant (SUG) or UC Grant received by the student

DRAFT 14

ResourcesCSU Financial Aid Information:http://www.calstate.edu/SAS/sfa_index.shtml

UC Financial Aid Information:http://www.universityofcalifornia.edu/admissions/paying.html

FAFSA and federal PIN Information - www.fafsa.ed.gov

Cal Grant and MCS Information - www.csac.ca.gov or 1-888-224-7268California DREAM application - https://dream.csac.ca.gov/

What will my monthly repayment be for student loans?http://studentaid.ed.gov/repay-loans/understand/plans/standard/comparison-calculator