Financial Aid

Question 1

What does the American Opportunity Tax Credit (AOTC) do?

Answer 1

Provides a partially refundable tax credit for qualified education costs for the first four years of undergraduate education

Question 2

What resources should a CFP® professional and client consider in the development and analysis of a college savings plan?

Answer 2

State government aid
Aid from the college/university
Scholarships
Tax credits for education expenses
Aid from the military

Question 3

What is the maximum amount of expenses that can be applied to the Lifelong Learning Tax Credit each calendar year?

Answer 3

$10,000 (Credit = 20% of first $10,000 in education expenses)

Question 4

Describe a Federal Pell Grant.

Answer 4

Money given to undergraduate students that does not need to be repaid; it is considered need-based aid that is only given to students with a low EFC.

Question 5

What types of federal student aid are available?

Answer 5

Federal Pell Grant
Federal Supplemental Educational Opportunity Grant
Federal Work-Study
Federal Direct Loan (Subsidized and Unsubsidized Loans)
Federal Perkins Loan Programs
Teacher Education Assistance for College and Higher Education (TEACH) Grant

Question 6

Name the two federal loan programs.

Answer 6

Federal Perkins Loan Program

William D. Ford Federal Direct Loan Program