Paying for College - NMU Admissions

Worried about how you and your parents are going to pay for college? Understanding how financial assistance and bill paying works can help you relieve some of your stress over paying for your college education. Keep in mind, it is a great investment. According to the U.S. Census Bureau statistics, if you have an undergraduate college degree, you will earn an average of 80 percent more than your friends who only have a high school diploma. The difference is potentially more than $1,000,000 over your working career. So, college is worth the money but the cost can be a bit intimidating. Let's go over financial aid options available at Northern Michigan University.

• We offer one of the lowest combined tuition and room and board rates among state institutions in Michigan.
• Eighty-two percent of Northern students receive financial assistance.
• We awarded nearly $35 million from all sources of financial aid last year.
• Our average financial aid package is more than $15,800 per student each year.

We intend to continue this level of commitment, not only for those students who could not attend Northern without such assistance, but also for those who deserve to be recognized for their academic performance, talent or leadership ability.

There are a wide variety of financial aid resources available to you:

• Grants and scholarships (which do not have to be repaid)
• Part-time, on-campus employment
• Low-interest loans (most of which are repaid after you leave college)

There are two types of financial aid:

1. Need-Based Aid: The basic principle of need-based financial aid is that you and your family are expected to contribute as much as is reasonably possible to pay for your education. The expected family contribution is determined by the information you provide on the Free Application for Federal Student Aid (FAFSA). This is a form that you and your family first fill out when you apply to college. Your financial need is calculated by subtracting the expected family contribution from the total cost of your education.
2. Merit-Based Aid: Merit-based financial aid is made up of scholarships you can qualify for through good grades in high school,  high scores on standardized tests and through other achievements. You don't need to repay scholarships.
   
   Students can also get grants, also free money you don't have to pay back. Grants come from a variety of sources and they are given for a lot of different reasons. Your school guidance office can offer you more information about where to find out about available scholarships.
   
   We are prepared to assist you in meeting your financial need by awarding grants, scholarships, employment or low-interest loans.

Even though you'll be busy with your classes, activities and the social scene, you may consider working a part-time job on campus. This could be anything from working in the library to being a lifeguard at the pool.

Depending on the level of unmet financial need, student employees can get subsidized pay called Federal Work-study. Getting Federal Work-study as part of your financial aid package makes it easier for you to get a job on campus, since your employer gets a subsidy for part of your pay.

Working on campus can be a great way to meet other people and network on campus, too.

There's even help finding a job. The Career Services office can help you look for campus employment.

Low-interest loans come in various types. The government offers subsidized and unsubsidized loans to students attending college. Subsidized loans don't start compounding interest while you are attending college. Once you graduate or leave school, interest starts accruing and you'll have to start making payments within a few months of leaving school.

How interesting...

Unsubsidized loans do charge interest while you're attending school, but the interest can be repaid with the loan after you finish school. Loans are repaid after you finish or leave school. Although having lots of loans is not a good financial decision, the loan companies work to help you pay the loans back over a long period of time.

Even with government loans, scholarships and working, some students still need a little more to make ends meet. For these students, there are increasing numbers of alternative student loan programs, some of which are very aggressive in advertising to students.

Be sure you and your family completely understand the obligations of any loans you take out while in school.

But I didn't borrow that much...

In the past when you've borrowed money from your parents or friends, chances are you've paid back exactly what you borrowed. When you begin to pay back your student loans, you might wonder why do you owe more than what you borrowed?

One answer is interest. Interest is what the lender charges to use their money. When you receive the loan, you will be told of the interest rate. Although the rate may differ for various lenders, the federal government sets a maximum cap for interest rates. The rate is adjusted every July 1st.

The other reason you pay back more than you borrowed is the fees charged by the various players in the process that must be deducted from the loan amount before you get the check. These fees often include the origination fee and insurance fee. If you have any concerns, be sure to ask your school's financial aid office to clarify what fees your lender will deduct.

Know ahead what you are getting into!

When you apply for a loan, take the time to calculate the interest. In order to find the amount that you will owe, take the balance and multiply it by the interest rate. Then divide by 365.25. This will be the amount of interest accumulated every day on your loan. If you have a subsidized loan, you will not be charged interest while you are in college. If you have an unsubsidized loan, you can either pay the interest during school or defer the amount until you graduate.

Successfully taking out and paying back student loans can be the first step towards establishing a good credit history, but remember student loan debt is . . . well, debt.  You'll have to pay it all back, so don't take out any more loans than you absolutely need.

(Information compliments of www.wiredscholar.com and Alison Crowley at NMU)