REGENTS REPORT

South Dakota Higher Education: Good Investment. Great Future.   NO. 86, 1/5/98

Financial Aid Focus

Next month is "Financial Aid Awareness Month" and it is a good time to remind students and families that they are not alone in paying the costs of higher education. Through the Department of Education the federal government provides financial assistance to students and families for funding post-secondary education expenses. In addition, the universities, and many local charitable, service, and religious organizations provide scholarships. Of course, saving early is always the best strategy to ensure you are able to meet the costs of college. The next best thing is to apply for federal financial aid and do some research into local and special circumstance sources of financial assistance. Over 80% of South Dakota’s public university students receive financial aid.

Federal Financial Aid

The federal government is the single largest supplier of financial assistance to students in college. Generally, the FAFSA (Free Application for Federal Student Aid) is the only form necessary to apply for all applicable federal financial aid. Below is a description of the most common types of federal financial aid.

PELL GRANT

The Federal Pell Grant Program provides grants to needy undergraduate students who have not yet received a degree. For 1998-99 the maximum Pell Grant award was increased to $3,000 and can be applied to tuition, fees, books, and living expenses.

FEDERAL WORK-STUDY

Work-study programs provide part-time employment, usually on-campus, for college students who need income to help in meeting education costs.

PERKINS LOAN

The Perkins Loan is a low interest (5%) loan provided to students.

STAFFORD LOANS

Most Stafford Loans are subsidized by the federal government, which pays interest on the loan while the student is in college. Any student enrolled at least half-time may apply.

Also, the new Hope Scholarship, not really a scholarship at all, will provide a potential tax credit of up to $1,500 for the each of the first two years of college for eligible taxpayers. This program is a reduction of tax liability for the 1998 tax year.

Financial Aid Awarded

The total amount of financial aid awarded to South Dakota students has increased 44% in the last five years. The chart below shows the total amount of financial aid awarded from all sources for fiscal years 1992-97.

Students Receiving Aid

The percentage of students receiving financial aid has increased three percentage points between FY93 and FY97, shown in the graph below.

E-mail us at: info@bor.state.sd.us

Conclusion

Financial aid is available to most students attending the public universities. In addition to federal aid, the largest source, there are also many local sources for aid. Many families make the mistake of assuming they are ineligible for federal aid or apply too late. For more information on federal financial aid, you can call 1-800-4FED-AID; or you can visit the Board of Regents homepage at www.ris.sdbor.edu, where you will find links to the universities and financial aid resources.