Unit 9 Financial Aid

Question 1

Scholarship

Answer 1

Cash grant for academic promise

Question 2

Grant

Answer 2

Cash given for need, rather than for academic record.

Question 3

Cost of Attendance (COA)

Answer 3

A student’s cost of attendance at a postsecondary institution includes: tuition and fees; room and board expenses while attending school; allowances for books and supplies (including a reasonable allowance for renting or purchasing a personal computer); transportation; loan fees for federal student loans (if applicable) ;dependent-care costs; costs related to a disability; and other miscellaneous expenses.

Question 4

FAFSA (Free Application For Federal Student Aid)

Answer 4

FAFSA forms become available in December of the senior year. All students applying for any federal financial aid must file this form as soon as possible after January 1. Analysis of the data on this form will determine eligibility for Pell Grants; Supplemental Educational Opportunity Grants (SEOG); Stafford Loans (subsidized and non-subsidized); Perkins Loans; work-study; and other federal and, in some cases, state programs.

Question 5

CSS (College Scholarship Service) Profile™

Answer 5

Separate from the FAFSA, each college may have its own financial aid form which is used to help their financial aid offices determine a student’s eligibility for the institution’s own funds.

Question 6

Major

Answer 6

Properly, the field of specialization of a college undergraduate. The student normally does from onequarter to one-third of his or her total undergraduate work in this major field.

Question 7

Selective College

Answer 7

A selective institution will set stiff requirements in terms of promise and demonstrated academic ability rather than simply in terms of specific courses taken. The degree of selectivity may vary from the college that accepts three out of four of its applicants to one which accepts only one out of eight.

Question 8

529 College Savings Plan

Answer 8

A 529 plan is a tax-advantaged investment plan designed to encourage saving for the future higher education expenses of a designated beneficiary (typically one’s child or grandchild). The plans are named after Section 529 of the Internal Revenue Code and are administered by state agencies and organizations.

Question 9

Free Application for Federal Student Aid (FAFSA)

Answer 9

A form that can be prepared annually by current and prospective college students (undergraduate and graduate) in the United States to determine their eligibility for student financial aid (including the Pell grants, and work-study programs).

Question 10

Budget

Answer 10

A financial plan used to forecast and track income and expenses

Question 11

Expense

Answer 11

Use of finances to fulfil and one-time or ongoing obligation; expenses can be fixed or variable

Question 12

Fixed Expense

Answer 12

A regular, predictable expense, such as a mortgage payment or rent

Question 13

Variable Expense

Answer 13

An expense or expense category that is not fixed and can’t be precisely predicted; budget planning is something used to limit or constrain variable expenses

Question 14

Debt

Answer 14

A payment or obligation owed to another person or an institution, such as credit card debt

Question 15

Interest

Answer 15

A fee, often a percentage of principal, paid in exchange for borrowing money; also, funds earned on investments or on interest-bearing accounts

Question 16

Investment

Answer 16

A financial holding that is purchased with the expectation of increased value; investments can be secured or unsecured, and the expected value of return on one’s investment is usually dependent on the degree of risk involved; money put aside for profit

Question 17

Savings

Answer 17

Funds not spent and set aside, often on a regular basis, for later use

Question 18

Scholarships and Grants

Answer 18

Outright gifts of money that are, often times, based upon need. Sometimes, however, they are awarded for academic excellence and promise or for special achievements or abilities.

Question 19

Loans

Answer 19

Significant part of most financial aid packages. They must be repaid, but most often not until after you graduate. Interest rates are competitive with other types of loans. The payback period on college loans varies from two or three years up to 20 years.

Question 20

Work study

Answer 20

A part-time job on campus. For instance, you might work in the library or as a resident advisor, lifeguard or food-service worker. Jobs are arranged through the financial aid office.

Question 21

Compound Interest

Answer 21

interest paid or to be paid both on the principal and on accumulated unpaid interest

Question 22

Simple Interest

Answer 22

interest paid or figured on the original amount of a loan or on the amount of an account

Question 23

Principal

Answer 23

a sum of money that is placed to earn interest, is owed as a debt, or is used as a fund

Question 24

Social Security

Answer 24

a mandated retirement system in the United States; originally a part of Roosevelt’s New Deal

Question 25

Credit

Answer 25

the providing of money or goods with the expectation of payment in the future

Question 26

Credit Report

Answer 26

a record of your credit history that includes information about your identity, existing credit, public record, and inquiries about you

Question 27

Creditworthiness

Answer 27

trustworthiness with money based on prior history; a general qualification for borrowing

Question 28

Dividend

Answer 28

Money from the earnings of a company that is distributed to people who have an ownership in that company.

Question 29

Earned income

Answer 29

income that includes wages, salaries, and tips

Question 30

Gross pay

Answer 30

the amount an employee earns.

Question 31

Net pay

Answer 31

the amount the employee receives after deductions (aka- take home pay).

Question 32

Social Security tax

Answer 32

a tax that provides benefits for retired workers and their dependents as well as for the disabled and their dependents. Also known as the “FICA” tax.