January 15, 2009
While many stories right now are focusing on financial aid programs finding themselves strapped for cash to award an increased of needy applicants, this is not universally the case. Data published by The Chronicle of Higher Education shows that two federal grant programs that were added in 2006 still have more awards than applicants. The Academic Competitiveness Grant (ACG) and Science and Mathematics Access to Retain Talent (SMART) Grant have gained some participation, but still they're still falling short of enrollment goals.
Both grants are intended to supplement Federal Pell Grants for students who are both academically talented and financially needy. The ACG is a grant of $750 to $1,300 for college freshmen and sophomores who have completed a rigorous high school curriculum and excelled academically, while the SMART Grant is an award of up to $4,000 per year designed to support college juniors and seniors who are enrolled in a science, math, engineering, technology, or critically needed language program. Approximately 465,000 students received the ACG and SMART grants in the 2007-2008 academic year, up 95,000 from the first year they were offered.
In order to attract more applicants and meet their goal of doubling participation by the 2011-2012 academic year, the department is pushing financial aid administrators to become more aware of award criteria and to make sure the grants are being fully awarded. In addition, requirements have also been loosened and students enrolled in eligible five-year programs will be able to receive a SMART grant in their fifth year of school beginning in July.
March 3, 2009
With all the talk about spending and stimulus legislation and bailouts, it can be easy to lose track of what benefits taxpayers can actually expect to receive. Most likely, everyone knows that the American Recovery and Reinvestment Act, perhaps better known as “the stimulus,” will create jobs through funding “shovel-ready” projects and will put a little extra in paychecks through a tax rebate that will take effect this summer. You probably also know that there’s also financial aid in there for education, but you may not be sure exactly what.
Frankly, so much federal legislation and talk of change has been floating around in the last two years that anyone who last paid a tuition bill as recently as 2007 probably doesn’t even recognize financial aid in 2009. To help, we’ve prepared a breakdown of where student financial aid stands currently.
Pell Grants. The American Recovery and Reinvestment Act increased the maximum Federal Pell Grant award from $4,731 for 2008-2009 to $5,350 for 2009-2010. The maximum Pell award will go up again in 2010-2011 to $5,500 under this legislation.
The income threshold to qualify for federal grant programs also increased. Now students with an expected family contribution (a number determined by completing the FAFSA) of up to $4,671 (up from $4,041 this year) can qualify for Pell grants. They will not receive the whole award, but even the minimum award has increased—from $400 for full-time students in 2007-2008 to $976 for the same group in 2009-2010, due in part to the College Cost Reduction and Access Act, which increased all Pell awards by $490.
Students qualifying for Federal Pell Grants can also pick up additional college funding through Academic Competitiveness Grants or SMART grants, which include Pell eligibility in their criteria. Many non-federal college scholarships and grants also use Pell eligibility to determine awards, so the newly Pell-eligible will definitely want to do a scholarship search to see what’s out there.
Work-Study. More students will also see “federal work-study” on their financial aid award letter in 2009-2010 thanks to the economic stimulus legislation. More money is available to work-study programs that allow students to get a part-time job on (or occasionally off) campus and count the income as financial aid. Work-study programs provide great job opportunities for student workers, and since the money is given in the form of a paycheck, students can use these funds to pay their tuition bills or to cover living expenses.
Tax Benefits. One of the biggest perks of the American Recovery and Reinvestment Act is the creation of the American Opportunity Tax Credit, which replaces the Hope Credit. The tax benefits under Hope only went up to $1,800 and only could be taken for two years. The American Opportunity Tax Credit can be used for four years, can fund up to $2,500 of college costs (100% of the first $2,000 plus 25% of the next $2,000, for a total of $2,500), and up to 40% is refundable, so people who don’t pay as much in taxes as they would qualify to receive in the credit can still get something.
Additionally, the income level at which the American Opportunity Tax Credit phases out is higher than the Hope credit, allowing individuals with incomes of up to $90,000 and married couples with incomes of up to $180,000 to take it.
Families will be able to start taking advantage of the American Opportunity Tax Credit on their 2009 taxes.
Other Benefits. Much more is included in the American Recovery and Reinvestment Act. For example, students with 529 savings plans can now use that money to purchase a computer for school. Additionally, states will receive billions of dollars over the next two years, with a portion of the money devoted specifically to funding projects at public institutions of higher education, as well preventing or reversing massive reductions in state education spending.
While student loans stayed the same in the stimulus, they did receive a boost in the fall through the continuation of the Ensuring Continued Access to Student Loans Act, as well as other recent legislation, including some new aid to lenders.
If you’d like to read more about how recent legislation has affected paying for college, our blog archives feature breakdowns of the 2007 College Cost Reduction Act, the 2008 Higher Education Opportunity Act, the 2008 Ensuring Continued Access to Student Loans Act, the 2008 GI Bill, and more examples of what's going on with college in Congress.
March 11, 2009
The omnibus spending bill passed by the House of Representatives in February was approved by the Senate last night, and is expected to be signed by President Obama this week. The bill includes more funding for Federal Pell Grants, fixing the maximum award at $5,350 for 2009-2010, a number that's already been widely publicized.
Other student financial aid programs also receive a funding boost for the current fiscal year, including the Federal Perkins Loan cancellation program and several federal scholarship and fellowship programs. These increases aren't necessarily tied to larger award amounts, however. Federal Work-Study, which received a boost in the stimulus bill, will see the increase put into effect in the 2009-2010 fiscal year under the omnibus legislation.
Funding was held steady for SEOG, another federal grant program, as well as new Federal Perkins Loans. ACG and SMART grants actually saw a decrease in funding--now these programs have funding equal to the amounts they award, but no longer have large, unawarded funding surpluses. The surplus money from these programs has been redirected towards Pell Grants.
The passage of this bill, which should represent pretty much the final word on education spending for the current fiscal year, comes just in time for colleges to begin sending out financial aid award notices to students who have completed the FAFSA. If you still have your fingers crossed for a magic bullet for college costs, it's still not too late to kick your scholarship search into high gear and begin looking at ways to pay for school beyond federal aid.
November 24, 2009
Not everyone can or wants to become a chemical engineer or mathematician, but the White House wants to make sure the country's doing all it can to give students the opportunity to explore all of their options before they're ready to make decisions about their future career paths.
President Obama announced a new campaign Monday called "Educate to Innovate" that aims to encourage more middle and high school students to pursue science, technology, engineering, and math. (His remarks can be read here, courtesy of the Washington Post.) The program will call on outside organizations to spend their own money and time to educate students on the kinds of things they could do in those fields, and improve their skill sets in those areas. It's no secret that the United States has lagged behind other countries in math- and science-based fields, despite the kinds of resources already available in those fields. (Another government initiative, the Race to the Top Fund, was announced last July to in part provide more money to states for innovative science programs.)
If you're good at math or science and are still undecided about what you'd like to be when you grow up, consider this: the vast majority of highest-paying college majors involve some degree of math or science skill. Those fields of study tend to be more specialized - not everyone can be a computer engineer, for example, and often require some study beyond that undergraduate degree. But in addition to the generous salaries, advances in many of those fields make it an exciting time to pursue a career as a researcher or scientist.
There's also plenty of scholarship money to go around if you're planning on or already pursuing a math or science field. The National Science and Mathematics Access to Retail Talent (SMART) Grant is awarded to undergraduates in their third or fourth year. Eligible recipients must already be Pell recipients, and the maximum award is $4,000. If you're interested in competitions, the Intel Science Talent Search targets high school seniors with original research. Scholarships.com also awards Area of Study College Scholarships to students interested in computer science, engineering, technology, and general science. To see whether you qualify for any of these or thousands of other scholarships, many of them related to the maths or sciences, conduct a free scholarship search to see the kind of awards you're eligible for.
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