Sweet, I got in! Now how will I actually pay for this?

 

Applying to graduate school is an exciting opportunity that also comes with a tremendous amount of responsibility. Deciding how you will finance your studies is almost as important as where you will study and what program you choose. The financial aid process can seem daunting but it is really quite manageable if you do a small amount of research and become familiar with services the Office of Financial Aid provides.

Finances weighed heavily on my decision to go to grad school. When I applied, I was a full time teacher in Brooklyn and was looking for a program in Education Leadership. The program I applied to at TC was 60 units and I didn’t want to attend part time because it would have taken me FOREVER to complete 60 units while I continued teaching. I knew being a full-time student would allow me to get the most out of my grad school experience and allow me to earn my degree much quicker. Being a full-time student also meant I would have to give up my teacher salary and take on some student loans.

Here are a few things I have learned:
Even if you haven’t received a decision yet I would complete these steps so you are in front of the pack. Some people don’t realize that financial aid is a competitive process, the early bird definitely get the worm!

• File your 2007 Tax Return ASAP. Before the government can figure out how much money you need, they first need to figure out how much you earn. You can’t file your FAFSA until you file your tax return.

• Your FAFSA is your Free Application for Federal Student Aid. Before starting a FAFSA, you will need to create a Federal Student Aid PIN if you don’t already have one. Once you have your PIN, you can complete your FAFSA online. This is the entry point for student aid and will determine what kind of aid you qualify for.

• Complete a scholarship application for Teachers College by filling out this form and mailing it to the Office of Financial Aid at TC.

Applying for loans
There are several different types of loans. I have two Stafford Loans and one Graduate Plus loan, which I will discuss below and are the most common. You can also apply for a Perkins loan if you are eligible and for Private/Alternative loan if you have additional needs.

Stafford Loans – Subsidized and Unsubsidized
A subsidized loan is awarded on the basis of financial need. You will not be charged any interest before you begin repayment or during authorized periods of deferment. The federal government “subsidizes” the interest during these periods.

An unsubsidized loan is not awarded on the basis of need. You’ll be charged interest from the time the loan is disbursed until it is paid in full. If you allow the interest to accumulate, it will be capitalized, meaning the interest will be added to the principal amount of your loan and additional interest will be based upon the higher amount.

For periods of study that are less than an academic year, the amounts you can borrow will be less than those just listed. Talk to your financial aid administrator to find out how much you can borrow. Generally, if you’re a graduate student, you can borrow up to $20,500 each academic year. Only $8,500 of this amount may be in subsidized Stafford loans.

The amount given above is the maximum yearly in both subsidized and unsubsidized loans. You may receive less than the yearly maximum if you receive other financial aid that is used to cover a portion of your cost of attendance.

All Stafford loans have a fixed rate of 6.8%

Graduate Plus Loan
Graduate Plus loans are similar to Stafford loans in that the federal government ensures a fixed interest rate throughout the loan period; however, the interest rate is higher at 8.5%. There are many different lenders you can choose from for your Grad Plus loan and all lenders offer incentives for you to choose them. Incentives vary and you should choose a lender who provides incentives that fit your financial lifestyle. For example, some incentives include a lower origination fee while others may reduce your interest rate if you sign up for automatic payments. Much of it depends on your individual financial profile. Teachers College provides a preferred lender list for Grad Plus loans that make it very easy to compare lenders and the incentives each one offers.

Above all…

This is one area where you really want to do your homework. The financial aid choices you make before grad school will have a tremendous impact on how you live after grad school. Keep in mind that there are resources out there. Most importantly, visit the Office of Financial Aid website frequently to stay on top of this process and never hesitate to ask questions. We are here to support you and this very important step in your career.

Have a great week!