THE BLOG
09/17/2013 12:34 pm ET | Updated Nov 17, 2013

Top 5 Reasons You Should Apply for Financial Aid

It's that time of year again when parents and their high school students gear up for the college application process. Somewhere along the line you are also going to have to deal with the financial end of things. You may even be dreading that. Perhaps you have heard stories from other parents who told you what a challenge it was.

It may seem a bit daunting at first, but the secret is advance planning and preparation. Put some of your documentation together now and you won't be under pressure to file the FAFSA (Free Application for Federal Student Aid) when the time comes. That will decrease the amount of mistakes you make, and increase the potential for receiving the maximum amount of aid available for your financial situation.

You might think it would be easier just to borrow money or take out a line of equity on your home, but that could put you and your family into needless debt. If the alternatives are spending a little time to receive the financial aid to which you are entitled or putting yourself into debt to avoid paperwork, it seems that applying for financial aid makes much more sense. Here are the top five reasons you should apply for financial aid:

1. Don't assume anything: Some parents assume they don't qualify for financial aid and don't even bother completing the FAFSA. This could be a big mistake, because eligibility is not based solely on income. You won't know what you're eligible for until you get the facts.
2. You will probably pay more for loans elsewhere: Even if the actual amount of grants and scholarships received is minimal, you aren't eligible for federal loans without completing the FAFSA. In spite of the recent political drama, the rates on federal student loans are usually still the best around.
3. You might miss out on other aid: Many states and schools rely on the FAFSA for their awards. Although you might not be eligible for assistance on a federal level, you don't want to miss other opportunities.
4. Your situation has changed: You may have been rejected before, but it is always a good idea to submit a new application, especially if your situation has changed. If you have divorced, had a change in income, or have another child in college, you might qualify for aid now.
5. It's not as bad as you think: The federal government has many great online resources that can help explain and walk you through the entire process. The reason you might be hearing so many complaints is because people waited too long. If your child is going to college for the first time next year, try to start the process as early in January as possible.

Start Early

Even though many parents do apply for financial aid, the government reports that most do not receive the maximum amount of help to which they are entitled due to errors on the FAFSA. This could be due to time pressures or misunderstandings when completing the application. The best advice is to start the financial aid planning process as early as possible in order to allow the most time for decision-making.

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