Frequently Asked Questions
Are there any programs in California that would allow one to prepay college tuition?Yes. Check out California Golden State ScholarShare College Savings Trust. ScholarShare is an IRS Code Section 529 plan. Funds are invested in low-cost, professionally managed stock, bond and money market mutual funds designed to outpace tuition inflation. Investments grow on both a federal and state tax-deferred basis until withdrawn, at which point they are taxed at the beneficiary's (lower) rate. The funds are highly flexible - they may be used at any accredited higher education institution in the U.S., including vocational and technical schools and, if not used, can be transferred to other family members. Funds can be used for tuition, room and board, books, fees and other qualified expenses.
Unlike other college savings vehicles, there are no income limits and maximum contribution levels are far higher than the Education IRA. These "529" plans have been featured in Time, Newsweek, Money Magazine and USA Today as the best new way to save for college. Contributions can be made by check, payroll deduction or automatic funds transfer. For payroll deduction contributions, the minimum is only $15.
Do middle-income students qualify for student financial aid and/or for grant assistance to offset the recent student fee increases?Many middle-income students do qualify for student financial aid, though most of it would be in the form of student loans and loans their parents or guardians may take to help finance students' college education. The federal government has established a rather complex methodology for determining the financial need of a student based upon the student's and his or her family's individual circumstances. The State's public colleges and universities use this federal methodology for determining a student's financial need. Students who feel they need financial assistance in order to attend or complete their postsecondary education should apply for financial aid even if they believe they or their parents earn too much money. For example, the University of California has recently announced that all financially needy students whose family incomes are less than $90,000 would receive an institutional grant to partially offset the recent increase in UC student fees -- even if those students do not qualify for any other types of grant aid. Because many middle-income families are considered financially needy, they too are eligible to receive a waiver of all California Community College student fees. Even if students are not financially needy, they or their parents may still receive a federal tax credit and/or a federal tax deduction for the student fees they pay.
Given the recent increases in student fees, has additional financial aid been provided to offset the fee increases for financially needy students?Yes. State funded, need-based grant aid has been increased to cover the full cost of tuition increases at the University of California and the California State University. The segments have also adjusted their institutional financial aid programs to provide appropriate aid to financially needy students to offset the recent student fee increases. Both UC and CSU regularly set aside between 24 percent and one-third of the additional revenue generated from the student fee increase for additional grant aid to needy students in recent years. All financially needy community college students are eligible to have their student fees waived through the Community College Board of Governors' Fee Waiver Program. The overwhelming majority of financially needy students attending the State's public colleges and universities receive some form of need-based financial assistance. This aid generally offsets systemwide student fee increases. However, students must apply for financial aid in order to receive this assistance.
How does a student apply for financial aid?The first step in applying for student financial aid is to complete the Free Application for Federal Student Aid or FAFSA. The FAFSA is available from college and university student financial aid offices, in public libraries, or can be completed on-line. Students are encouraged to contact their college or university's student financial aid office for assistance. Students still in high schools should work with their schools' counselors to assure tha they have the appropriate school information needed for the FAFSA. Students attending the California Community Colleges can have their enrollment fees waived by completing a short application form and requesting a Board of Governor's (BOG) Fee Waiver. The Community College BOG Fee Waiver applications are available from any California Community College student financial aid office. Related Links:
What is Title IV?This term refers to a section of the federal Higher Education Act of 1965, as amended, which authorizes the vast majority of federal student financial assistance programs. Title IV student financial aid programs are offered by most institutions that are accredited by an accrediting agency that is recognized by the U.S. Secretary of Education. It is important to note that not all accrediting agencies are recognized by the U.S. Secretary of Education. Students attending institutions that are accredited by agencies not recognized by the Secretary are ineligible to receive aid from the federal Title IV student financial aid programs. Title IV programs include:
- Federal Pell Grants
- Federal Supplemental Educational Opportunity Grant (FSEOG)
- Federal Work Study
- Federal Direct Loans
- Federal Direct PLUS Loans
- Federal Perkins Loans
- Federal Stafford Loans