MC #1
Which of the following statements is TRUE about the value of a college degree?
a. A high school graduate can expect to earn about the same as a college graduate
b. Every college graduate can expect to have a starting salary over $60,000 right after college
c. A college graduate can expect to earn, on average, more than a high school graduate over a career
d. A college graduate typically earns less than someone with a high school diploma for the first 10 years
C. A college graduate can expect to earn, on average, more than a high school graduate over a career
During a period of financial hardship, you can apply for this to pause student loan payments while interest still accrues…
a. grace period
b. grants and scholarships
c. FAFSA
d. Forbearance
d. Forbearance
What are 3 differences between federal and private school loans?
You don’t have to start paying federal loans until you graduate
Federal loan interest rates are typically lower than those of private loans
The interest of some federal loans is paid for by the government (subsidized)
You don’t undergo a credit check to receive federal student loans (except for Direct PLUS loans)
Federal student loans and/or their interest are more likely to be tax deductible
Federal student loans are more likely to offer deferment and/or forbearance
Private student loans might require a cosigner
Private student loans sometimes charge a fee for paying off loans early
Private student loans are less likely to be eligible for forgiveness
What is the order for accepting financial aid?
Scholarships and grants, work study, federal student loans, loans from state govt, finally private loans
Which repayment option does not accrue interest while your required payments are paused?
a. Consolidation
b. Deferment
c. Refinancing
d. Forbearance
b. Deferment
Which of these options lists the types of financial aid from MOST attractive to LEAST attractive?
a. Private loans, Federal loans, Work-study, Grants/Scholarships
b. Grants/Scholarships, Work-study, Federal loans, Private loans
c. Work-study, Grants/Scholarships, Federal loans, Private loans
d. Federal loans, Grants/Scholarships, Work-study, Private loans
b. Grants/Scholarships, Work-study, Federal loans, Private loans
In order to qualify for financial aid, which application must you submit?
a. FAFSA
b. PLUS
c, SAVE
d. SAI
a. FAFSA
What is the rule of thumb?
Your total student loan debt should not exceed your expected first year salary after graduating college.
What is the order of the financial aid process?
FAFSA, SAI, then financial aid package and award letter
Which of the following is considered a direct cost of attendance?
a. Travel expenses
b. Cell phone bill
c. Tuition
d. Food and entertainment
c. Tuition
The federal government makes interest payments on __________ while you’re enrolled in school at least half-time, for the first six months after you leave school, and during any period of deferment.
a. Work-Study
b. Subsidized federal loans
c. Unsubsidized federal loans
d. Grants
b. Subsidized federal loans
Which of the formulas below correctly calculates net price?
a. Sticker price - student loans = net price
b. Grants and scholarships + student loans = net price
c. Sticker price - grants and scholarships = net price
d. Sticker price + grants and scholarships = net price
c. Sticker price - grants and scholarships = net price
What is FAFSA?
Free Application for Federal Student Aid Oct 1st opens up June 30
What is a grace period?
A period of time that generally begins on the day after a borrower graduates, leaves school, or drops below half-time enrollment and ends on the day before the repayment period begins; borrower typically is not required to make payments during this time
Typically, when should you first file the FAFSA?
a. After you finish freshman year of high school
b.October or November of your last year of high school
c. After you receive your Student Aid Index
d. Once you are ready to start repaying your student loans
b.October or November of your last year of high school
Who receives and uses the information submitted in your FAFSA?
a. Your employer to see if you’ll still be able to work while attending college
b. Your parents to keep track of your progress at college
c. The federal government for tax purposes
d. The schools you’ve applied to and your state government to determine your eligibility for financial aid
d. The schools you’ve applied to and your state government to determine your eligibility for financial aid
What types of money are used in paying for college and in what order should you use them?
a. Your money, borrowed money, free money
b. Borrowed money, your money, free money
c. Your money, free money, borrowed money
d. Free money, your money, borrowed money
d. Free money, your money, borrowed money
What is SAI?
Student Aid Index now replaces EFC. SAI is an eligibility index number that FAFSA uses to determine how much federal student aid the student could receive.
What are the 4 types of federal loans?
Subsidized Direct Loans, Unsubsidized Direct Loans, Direct Plus Loans and Federal Perkins Loan
What are the 4 tips to reading an award letter?
Understand the cost of attendance 2. Figure out how much financial aid your getting 3. Do some simple math 4. Compare your offers
Janelle's family earns about $60,000 per year. She has been accepted to College A and College B and is comparing their financial aid packages. College A has a sticker price of $28,000 and net price of $12,000. College B has a sticker price of $60,000 and net price of $9,000. Which statement below is FALSE?
a. It will cost less to attend College A
b. College B is providing Janelle more grants and scholarships
c. College A has a lower sticker price than College B
d. It will cost less to attend College B
a. It will cost less to attend College A
Who is eligible to receive Direct Subsidized loans?
a. Graduate students
b. Professional students
c. Undergraduate students
d. Students enrolled less than half-time
c. Undergraduate students
What is exit counseling and when is it completed?
Ensures you understand your student loan repayment obligations. Complete when you graduate, quit, or drop below part time.
What is deferment?
A process that allows a borrower to pause their federal student loan payments; interest does NOT accrue during this time period on subsidized loans
What are the direct costs of attending college?
Direct costs are paid directly to the college.
Tuition
Housing
Meal Plan