Families often overlook state financial aid for college

It’s one of the most overlooked pieces of the financial aid puzzle: state-supported scholarships and loans.

Every state offers at least some form of financial aid for students who are planning on attending public or private schools in their home state. Much of it is in the form of scholarships and grants that don’t require repayment.

Programs such as the Cal Grant High School Entitlement Award for California students, the Illinois Golden Apple Scholars, Virginia’s Granville P. Meade Scholarship, Florida’s Bright Futures Scholarship program and Pennsylvania’s Targeted Industry Scholarship (or TIPS) offer hundreds if not thousands of dollars in money to eligible students.

For example, Virginia’s Meade program provides $2,000 per year up to four years to students attending the state’s public and private schools. In addition, Maryland’s Delegate Scholarship requires eligible students to contact their state delegates and apply for an award that can range from $200 to over $10,000.

Other programs for college-bound students are career specific. Pennsylvania’s TIPS program offers grants of up to $5,000 to college-bound students pursuing careers in fields such as energy, agriculture, food production and diversified manufacturing.

While aid packages can be substantial, keep in mind that states go through feast and famine cycles when it comes to appropriating funds for college financial aid.

Money is typically available on a first-come, first-served basis, and application deadlines are fast approaching. Some states set February due dates while others roll into spring.

Many parents — particularly in middle- and upper-income brackets — never apply for state money because of the mistaken belief they won’t be eligible, financial aid experts say. It’s the same reason why families don’t fill out the FAFSA, the Free Application for Federal Student Aid, said Rick Castellano, a spokesman for student loan provider Sallie Mae.

According to Sallie Mae’s latest “How America Pays for College” report, only 68% of families filled out the FAFSA for the 2020-2021 academic year. And that’s down from the 83% completion rate the previous year before the pandemic.

“Even if your family makes $200,000 a year, you could be eligible for aid,” Castellano said.

The most important thing a student can do to tap into state dollars is to submit the FAFSA, said Joe DePaulo, chief executive officer of College Ave Student Loans.

Some states use the data you supply on the FAFSA to award their aid. Some also require a supplemental form that is processed by that state’s higher education grant agency. Check with the agency or with your high school guidance counselor for information on applications, eligibility and filing deadlines.

Collegescholarships.org offers a state-by-state breakdown of scholarship programs. In addition, there are multiple free online tools to help you fill out the federal and state financial aid forms, such as Sallie Mae’s salliemae.withfrank.org/fafsa/.

If your family is eligible for state financial aid, the amount will appear as part of the aid packages you receive from the college by spring, according to the latest edition of the Princeton Review’s “Paying for College.”