Financial Aid Packages 101

For many students, the financial aid package is a huge factor in determining which college they’ll attend. Financial aid packages differ by school, but the types of awards are similar. If you understand the awards, you can decide what financial aid package works best for you.

Here are three important terms to remember:

  • Cost of Attendance (COA)
  • Student Aid Index (SAI)
  • Need

The Cost of Attendance(COA) typically includes your estimated tuition and fees (generally based on full-time enrollment). It also estimates room and board, transportation, books, and other costs. Pay attention to the COA for each college because some include more factors than others. 

Your Student Aid Index (SAI) is the number your FAFSA application generates after you input your information. It’s used to determine how much financial aid you’re eligible for and which types. Since you renew your FAFSA each year, your SAI can change throughout college.

The difference between your COA and your SAI is known as need. Financial aid offices do their best to cover your needs by providing various forms of financial aid. 

Grants and Scholarships

Grants and scholarships are free money you don’t have to pay back. They come from colleges, the government, the state, and outside sources. Let colleges know if you earn any outside scholarships because they can impact your financial aid package. Some grants, such as the TEACH grant, convert to student loans if you do not fulfill the associated service obligation post-graduation. Make sure to read the fine print!

Direct Stafford Loans

Eligible students can receive Direct Stafford Loans to help fund their education. Backed by the federal government, these loans typically have lower interest rates and more flexible repayment options than most private loans. Students are capped on the amount they can take per year. For example, a first-time college freshman classified as a dependent can only utilize $5,500 per academic year. The amount increases each year, up to $7,500 per academic year. There are two kinds of Direct Stafford Loans: subsidized and unsubsidized.

Subsidized loans DO NOT accrue interest while you are in school (enrolled at least half-time) or during the loan’s grace period. The grace period is for six months after you leave school or drop below half-time status. A portion of your direct loans may be in the form of subsidized loans if you have a high financial need. 

Unsubsidized loans begin accruing interest as soon as they disburse (are applied to your bill or direct deposited to your bank account). All interest accrued while in school is added to your principal balance. It’s a good idea to make interest-only payments while still in school so the amount does not continue to grow. 

For Direct Stafford Loans, you must complete a master promissory note (loan contract) and entrance loan counseling (covers terms of loan, repayment, etc.)


The acronym PLUS means Parent Loan for Undergraduate Students. You may see a PLUS loan estimate on your financial aid package. This means your parents can apply for the PLUS loan to cover your remaining cost of attendance. The PLUS loan is solely in the parent’s name, and approval is based on a satisfactory credit check. If your parents are denied the PLUS loan, they may request an endorser, or you can receive additional Direct Stafford unsubsidized loans. Repayment for PLUS loans typically begins upon disbursement unless your parent applies and is granted deferment.


The Federal Work-Study Program provides part-time jobs for students with financial needs. These jobs are typically on-campus. If you are interested in work-study opportunities, indicate this on your FAFSA application. Your work-study opportunity has a specific amount of money you can earn, and your hours will be capped once this amount is reached. The school will pay you directly, or the payment can be applied to your student account for tuition and fees.

Understanding the different types of awards will help you evaluate your options. Talk with your school’s financial aid office so they can explain your package and answer any questions. You can pick and choose what aid to accept and even reduce amounts. For loans, it is wise to take only what you absolutely need and be sure to ask about payment deadlines and payment plan options. Do your research before you agree to any amount of money. Understanding financial aid packages will pay off!

A Crash Course in Admissions and Financial Aid

As you fill out financial aid forms and compare financial aid packages, you’ll probably see some unfamiliar terminology. While most terminology is universal across US colleges, some terms are unique to specific colleges. Don’t be afraid to ask your high school or admissions counselor about acronyms or processes. They want you to be as informed as possible throughout the process.

Financial Aid Terminology

Cost of Attendance (COA)

COA is more than just your tuition. It’s a combination of tuition and an estimate of the extras, including room and board, books, laptop, transportation, and other personal costs.

CSS Profile

CSS Profile is a form some schools require you to fill out to be considered for scholarships.

Entrance Loan Counseling (ELC)

ELC is an online training module that goes over the terms of the loan, origination fees, interest rates, repayment options, and more. ELC is mandatory when you take out both student and PLUS loans.

Student Aid Index (SAI)

The SAI is the number colleges use to determine how much financial aid you’re eligible for and which types. The SAI is an important financial need calculation on the Free Application for Federal Student Aid (FAFSA), the form used by colleges, states, and other scholarship providers to determine financial aid packages. Since you renew your FAFSA each year, your SAI can change while you’re in college.

Free Application for Federal Student Aid (FAFSA)

You must fill out the FAFSA every year you attend college to be considered for need-based aid and if you want to take out federal student loans to fund your education. The 2024–25 FAFSA will be available in December 2023. If you are unmarried and under the age of 24, have your tax info and your parents’ tax info from two years ago handy. You can read more about the FAFSA here.

Gift Aid

Gift aid is the best kind of aid because you don’t have to pay it back. Gift aid is usually in the form of grants and scholarships. Ideally, you want all your aid to fall into the gift aid category.

Master Promissory Note (MPN)

This is your loan contract that states that you agree to pay back all of the money you have borrowed, including interest.


Need is the difference between the cost of attendance and your student aid index.

Need-Based Aid

Need-based aid is determined based on your financial need. Your grades, community involvement, and athletic prowess do not come into play. The amount of need-based aid is generated by subtracting your Student Aid Index from the Cost of Attendance.


When a university is need-blind, it does not consider your financial need/status when making admissions decisions. Need-blind schools never deny you because of your inability to pay full tuition. Fortunately, many schools are need-blind.


Need-aware is the opposite of need-blind. Need-aware colleges take your ability to pay tuition into consideration when they are making admissions decisions.

Origination Fee

An origination fee is paid to the bank to compensate them for administering a loan. The fees are usually 3% of the amount disbursed. A portion of the money is paid to the federal government to help offset its administrative costs.

Pell Grants

These are federally funded need-based grants awarded based on your FAFSA application. You do not pay these back.

Parent Loans for Undergraduate Study (PLUS Loans)

Parents can apply for a PLUS loan up to the Cost of Attendance minus any other aid. Qualification for this loan is based on a positive credit history. Parents must begin repayment on the PLUS loan once the loan is disbursed. However, they can request a deferment while the student is enrolled at least half-time in school. PLUS loans begin accruing interest as soon as they disburse.

Public Service Loan Forgiveness (PSLF)

Public Service Loan Forgiveness is a program where your remaining direct federal student loan debt can be forgiven after 120 payments under a qualifying repayment plan and while employed by a qualifying governmental agency or non-profit organization.

Renewable Scholarship

A renewable scholarship is awarded for more than one aid year. Renewable scholarships typically require a recipient to maintain specific academic standards. Some require students to reapply every year.

Satisfactory Academic Progress (SAP)

To continue to receive aid, you must meet specific benchmarks, such as credit completion or a certain GPA. Make sure you understand the specific requirements for your aid.

Student Aid Report (SAR)

You’ll receive this report via email after submitting the FAFSA. The SAR is your opportunity to review submitted information to ensure everything is accurate.

Subsidized Loans

Subsidized loans do not accrue interest while you are still enrolled at least half-time status and for the following grace period. Repayment begins six months after either graduation or dropping below half-time status.

Unsubsidized Loans

Unsubsidized student loans from the government begin accruing interest immediately upon disbursement. Repayment begins six months after either graduation or dropping below half-time status. If you can, consider making interest-only payments while in school so the interest doesn’t capitalize.


If your FAFSA was selected for verification, don’t panic. About one-third of applications get selected, some at random, and some because they found mismatching information on the application that requires further explanation. Each institution lets you know what paperwork is required to complete this process. Complete the paperwork immediately because your financial aid package can’t be finalized until it’s completed. Pro tip: If you have the option to use the IRS data retrieval tool, do it! It will automatically sync your tax return with your FAFSA and should reduce the likelihood of verification.


Work-study is a program that allows you to earn money by applying for on-campus jobs. You typically have to apply for these positions just like any other job. The salary helps offset a portion of your Cost of Attendance. Most work-study jobs are generally no more than 20 hours per week.

Academic Terminology

Bursar’s Office

The office where you pay your tuition bill.

Class Standing

Freshman (0-30 credit hours earned), Sophomore (31-59 credit hours earned), Junior (60-89 credits earned), Senior (90+ credit hours earned).


CLEP stands for College Level Exam Program. CLEP tests can be taken in many subjects to demonstrate college-level proficiency and award you college credit for a specific course. If you are interested in taking a CLEP test, check with your college regarding CLEP acceptance policies, scores needed, etc.

Credit Hours

Most college courses will be three credit hours. In a typical 16-week semester, you will spend three hours in the classroom per week learning academic material. Your work for that class doesn’t end after those three hours, so set aside additional time to complete your homework. You typically complete 120 credit hours to earn a bachelor’s degree.

Degree Audit

This is a report showing your progress toward your college degree completion. If you took any dual credit courses, AP courses, or CLEP tests, including the necessary documentation to your college to ensure these courses are reflected on your degree audit.


Electives are courses outside of your degree plan. Some degrees have room for electives, and you can take any college course to meet your total credit hour requirement. Other times, you can choose electives within a specific subject area.


FERPA stands for Family Educational Rights and Privacy Act. FERPA is designed to protect the privacy of your educational records and allows you the right to review your records. Once you turn 18 or attend a postsecondary institution, you’re the only person who sees the information unless you sign a release form authorizing others. This means your parents will not be given your academic transcript, disciplinary records, or GPA without your permission.

Transient Enrollment

This is enrollment at an institution other than your own college that you attend. For example, it’s considered transient enrollment if you go home for the summer and take a course at a college or university in your hometown.

Your Guide to the FAFSA as a First-Time Applicant

The FAFSA, or Free Application for Federal Student Aid, is an important part of the college application process. Once you submit the application, you’ll be considered for financial aid from federal and state governments and many colleges and universities. The 2024–25 FAFSA will be available in December 2023. It’s a good idea to complete the FAFSA as early as possible to ensure you’re considered for the maximum amount of financial aid. 

The FAFSA application process can feel intimidating, so we’ve created a simple guide that will help make the application process as easy as possible. 

Step 1: Create Your FSA ID 

Your FSA ID is the username and password that will grant you access to certain Department of Education websites. It will also help verify your identity and serve as your digital signature for your FAFSA. If you are a dependent, your parent/guardian must create an FSA ID, too. 

Step 2: Gather Important Documents 

You may need to dig deep for some of this information. Ask your parent or guardian to help you find the following documents. 

  • Your Social Security Number 
  • Parents’ or Guardians’ Social Security Numbers (if you’re a dependent student) 
  • Driver’s License Number (if applicable) 
  • Alien Registration Number (if you are not a U.S. Citizen) 
  • Federal Tax Information, including W-2 information for you (and your spouse, if you are married) and your parents/guardians (if you’re a dependent) from two years prior (ie. 2023-2024 school year will use 2021 tax info).
  • Records of your untaxed income, such as child support received, interest income, and veterans noneducation benefits, for you and your parents/guardians if you are a dependent student.  
  • Information on cash, savings, and checking account balances; investments, including stocks and bonds; and real estate (not including the home in which you live). Also, include any business and farm assets for you and your parents/guardians if you are a dependent student.

Once you’ve input the information above, keep these documents in a safe but accessible location in case you need them again.  

Step 3: Start the FAFSA 

You created your FSA ID, collected your documents, and December is here! It’s time to start your FAFSA. Head on over to and click “Start Here.” Be sure to ONLY use From there, you can also use the myStudentAid mobile app. Unfortunately, some websites look similar to the real FAFSA website, except they charge for filing your FAFSA. You should NEVER pay to file your FAFSA! 

Once you start a new application, you can create a save key. Then you can save your work if you don’t complete your application in one sitting and return to where you left off. Don’t skip this step!

Step 4: Are You a Dependent?  

The FAFSA will ask you several questions to determine your dependency status. In general, you are considered a dependent for FAFSA purposes if:  

  • You are under the age of 24, 
  • Unmarried,  
  • And not a member of the military.  

If you are classified as a dependent and feel you have an extenuating circumstance, we recommend connecting with your college financial aid office regarding your situation. 

Step 5: Input Financial Information 

This section is where you input your tax and financial information. If you are considered a dependent, input your parents’ tax and financial information too. Pro tip: If you have the option to use the IRS data retrieval tool, do it! It will automatically sync your tax return with your FAFSA and should reduce the likelihood of verification.

Step 6: Select FAFSA Recipients 

Colleges need your FAFSA information to be able to award financial aid. You must list one school, but you can add up to 10. Some states have specific requirements for how you list schools on your FAFSA to be considered for state grant aid, and you can review those guidelines on the Federal Student Aid website. The colleges on your list will use your FAFSA to determine the type and amount of aid they’ll offer you upon acceptance.  

Step 7: Sign and Submit the FAFSA 

You must sign your FAFSA application using your FSA ID. Once you’ve signed it, press submit! You’ll know you’ve successfully submitted your FAFSA when you see the confirmation page. You will also get an email confirmation of your submission. If you have a sibling in college who is also a dependent, this confirmation page will allow you to transfer your parents’ info to their FAFSA. Be sure that your parent(s) sign your FAFSA, too!  

If you’re ever stuck on anything FAFSA-related, you can always ask your high school counselor, college admissions counselor, or your prospective college’s financial aid office for help. Good luck! 

A Guide to the SAT

If you want to walk into the SAT feeling confident and ready to succeed, preparation is key! To help you prepare for the big day, here is a guide to everything you need to know about the SAT. 

How do I register for the SAT?

Visit the College Board website to register for the test. You’ll need to create a free online account. If you took an AP test or the PSAT, you may already have a College Board account. Register in advance to avoid late fees!

When should I take the SAT?

Plan to spend around 100 hours preparing for your first SAT, with enough time to take the test 2-4 times before submitting your college applications. Determine how much time you need to prepare for the test by working backward from your college application deadlines. 

It’s also best to take the test after you’ve completed a majority of these classes:

  • Algebra II
  • Geometry
  • Trigonometry
  • Three years of science (one year of physical science)

Taking classes that cover concepts tested on the SAT can be very useful in preparing for the exam. Consider scheduling your SAT when you have a lighter course load. With seven test dates offered every school year, there are plenty of opportunities available. 

How many times should I take the SAT?

Plan to take the test at least twice. To maximize your score, consider taking it 3-4 times. The SAT offers a feature called “score choice,” which allows you to pick and choose the scores sent to colleges. Some schools still require you to send all your scores, so do your best to make every attempt count. Other schools may want your “Superscore” – your best score in each section across test dates.

How much does the SAT cost?

SAT costs change from year to year, so visit their website for updated information on pricing. Check out the fee waiver requirements to see if you qualify.

What is on the SAT?


This section tests reading comprehension and your understanding of vocabulary within context.


In this section, you will read passages with intentional grammar errors. Your job is to fix them.


The math section assesses your basic arithmetic, algebra I, algebra II, geometry, probability, and statistics knowledge.


Although this section is optional, some colleges require it. Check the requirements of the schools you wish to attend. We recommend registering for the essay section just to be safe.

What is the SAT score range?

Scores range from 400-1600. The optional essay is scored on three different dimensions, and the scores range from 2-8.

How do I prepare?

Khan Academy offers FREE SAT prep resources. For the most up-to-date SAT information, please visit College Board. 

Good luck! We’re rooting for you!

Why Your GPA Matters

If you’ve ever wondered how much your high school and college GPA matters, you’re not alone. Let’s unpack why your GPA matters at all stages of your education.

Your GPA and College Admissions

While all college admissions teams look at your GPA, some colleges place a higher weight on it than others. Even though all admissions teams review your grades and test scores, many believe your GPA is a strong indicator of college success. If you are applying test-optional, your GPA will likely be a larger part of the admissions equation because you won’t have test scores to review.

Think about your unique situation. How competitive are the schools on your college list? Are they test-optional? How do you feel about your test scores and current GPA? 

How to Improve Your GPA

If you’re unhappy with your GPA and feel it isn’t an accurate reflection of you, there are ways to improve it.

Start your semester strong.

After summer vacation, your mind is fresh and rested. Use it to your advantage and work extra hard on those first assignments, projects, and tests. When you score highly in the first few months of your classes, you give yourself a buffer in case you don’t test as well later in the semester. Consider taking advanced courses that could increase your weighted GPA. 

Do the extra credit.

Usually, teachers and professors address their extra credit policies in their syllabi. Approach them with respect and let them know you are willing to put in the effort to improve your grades. Ask about extra credit questions in advance, and don’t inquire about bonus points a few days before the final exam.

Get extra help.

If you’re struggling in a class, ask your teacher or school counselor about tutoring resources. Look into after-school help, peer help, office hours, and writing centers. There are plenty of options for students in both high school and college.

Consider summer school.

If you didn’t get the grade you hoped for, consider retaking the class in summer school. Some high schools allow you to replace your current grade with an improved one! If you plan to take the course at a different school, first get approval from your high school counselor.

Your GPA in College

Companies in math and science-based industries often ask for your college GPA. However, even if you choose a math or science major, your GPA only matters for an entry-level position. As soon as you start your career, your resume will revolve around your work experience.

Graduate School

Graduate admissions teams want to know if you can handle the rigor of a graduate program. If you want to attend graduate school, a high college GPA may set you apart from other applicants, especially if you’re applying to a prestigious law school or medical school.


Many college scholarships require you to maintain a certain GPA. If you have one of these scholarships, keeping your GPA high will help you keep the scholarship and pay for your college education.

A high GPA can help you stand out in your college application and future job. Make an appointment with your high school counselor or college guidance counselor if you have questions or concerns about your GPA,

7 Tips for Choosing a Major During High School

Choosing a major while you’re still in high school can feel like a huge decision, especially if you aren’t sure what you want to study or what career you want to explore. While you don’t need everything figured out, choosing 2-3 majors you like will help you pick colleges that fit your academic interests. Here are some tips to help you choose a major:

Think about your interests and strengths.

Think about what you like doing in your free time and what subjects you enjoy. Look for majors that use those strengths.

Read about different majors.

Check out My Majors in Encourage to learn about majors and the colleges that offer them. See which classes you could take within each major and which majors match specific careers. Use this information to build a list of majors perfect for you. 

Consider your career goals.

What careers interests you? Use My Careers in Encourage to explore thousands of careers based on your interests. Learn about the training paths and education requirements for each career.

Talk to people who work in jobs that interest you.

Reach out to people who work in careers that interest you. Ask them about their experience and the education you need for that specific field.

Take a variety of classes.

Take classes in different subjects to learn what you enjoy and where you do your best work. You may discover some new classes you love!

Get to know your high school counselor.

Your high school counselor can help you understand your college and career options. They can provide guidance and information about majors, careers, colleges, and academic requirements.

Visit college campuses.

Visit your favorite college campuses during school breaks. Take informational tours, talk to current students about their experiences, and ask academic advisors about the school’s majors and programs.

Choosing a major is exciting and personal to you! Choose a major that matches your interests, career goals, and values. You’ve got this! Encourage is here to help. 

10 Study Hacks

Ready to step up your study game? We’ve got 10 study hacks that will help you study smarter, not harder! 

1. Use voice-to-text to take notes.

Use the voice-to-text feature on your phone as a study tool! Instead of typing notes as you read, summarize your thoughts in your own words, and let your phone do all the typing. This feature is a huge time saver when you have tons of reading to do.

2. Try Kahoot and Quizlet.

Kahoot and Quizlet are two apps that can help you quiz yourself and your friends in a productive and fun way! If you don’t love these apps, there are many other quizzing apps to try!

3. Grammarly and Hemingway Editor.

These websites help you keep your writing clear and concise. The Hemingway Editor focuses on limiting adverb use, passive voice, and unnecessary words. Grammarly corrects grammar, suggests synonyms, and strengthens your language skills.

4. Take a walk before your exam.

According to this study, students who exercise before their exams perform better than those who don’t exercise. Test this study hack by planning a workout before your next exam or presentation!

5. Change your study conditions.

Try switching up your study location, what you’re studying, and who you’re studying with. Your sense of smell is a powerful tool for triggering memory. Try spraying an unfamiliar scent the next time you study a specific subject. When you’re ready to take the test, spray that scent again to help you remember the material you studied.

6. Draw.

If you use lots of colors and visualize your study materials, you’ll have an easier time recalling information. Drawing also gives you an excuse to take out the crayons and doodle!

7. Switch your fonts

If you need to read material fast, switch the font on your study guides. Your brain processes serif fonts faster than Times New Roman, Palatino, Georgia, Courier, and Garamond fonts.

8. Use apps to block distracting sites.

If you’re a self-proclaimed procrastinator, limit your distractions to get work done. If you can’t block the entire internet, consider blocking your favorite social media and gaming sites.

9. Watch a documentary on the topic.

If you’re a visual learner or want to see information in a different form, consider watching documentaries and videos on the subject. Watching relevant videos is another way to help prepare you for tests.

10. Listen to study music.

Music affects your mood and maximizes concentration. Soothing instrumental music may even reduce stress while studying. Have you made your study playlist yet?

These small tips can make a huge difference in your study game. Give them a try! You may find studying can be productive and fun!

What are the Different Types of Colleges?

Not all colleges are the same! If you’re wondering which college is best for you, here are the most common types of colleges and universities.

Private College/University

Private colleges/universities are four-year schools that don’t receive government funding and rely mainly on tuition, fees, and private funding sources. Private donations allow some private schools to provide generous financial aid packages, which helps offset tuition costs and makes the price comparable to public schools. If you like seeing familiar faces around campus, you may enjoy this type of college because they tend to be smaller and more intimate. 

Public Colleges/Universities

Public colleges/universities are four-year schools that receive funding from the government. This funding allows them to offer lower tuition and fees. Public schools classify students as either “in-state” or “out-of-state.” In-state residents pay lower tuition since their tax dollars are supporting that institution. Public colleges and universities tend to be larger in size and student body and offer many majors and on-campus clubs.

Junior/Community College

Junior/community colleges are two-year schools that offer courses parallel to the first two years of a four-year school. Admission is open access, so the school will admit you if you apply and meet all of the basic requirements. Although the school may be open access, some programs may implement selective admissions and enrollment limits. The price tag for these colleges is lower than private or public four-year institutions because they don’t offer everything you’d get at a four-year school. If you’d like to take basic courses at a lower cost and transfer to a four-year school later, or you want to pursue a career that only requires a two-year degree, you should consider this type of college.

Liberal Arts Colleges

Liberal arts colleges are typically small, four-year schools with an intimate campus setting and a diverse, well-rounded curriculum. As a student at a liberal arts college, you can expect to take courses in literature, history, languages, math, and science to complement the classes within your major.

Vocational or Technical School

Vocational and technical schools offer certification or training within a highly specialized field like welding, culinary arts, or dental hygiene. Most programs lead directly to a career in a short period of time.

If you already know what career you’d like to pursue, find out what education and training you need to land a job in that field. If you don’t know what you want to pursue, that’s ok too! Pick a school that offers a variety of programs and classes so you can explore all your career possibilities!