|13 financial aid traps
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12. Solicit gifts.
Hitting up Grandpa or your rich uncle (no relation
to the Web site) for as much money upfront as possible
might seem like a great way to find free money for
school, but there are three options that might be
better: delay payment, uncle can give the gifted money
to your parents or have them pay your debt directly
to your school.
While you shouldn't deny your favorite aunt the joy of contributing to your education, it might work out better from a financial aid standpoint to ask relatives to delay gifts so you won't be penalized for their generosity in financial aid determinations.
If Grammy won't wait until after you graduate to make her contribution to your education, have her give the money to your parents instead so it won't count as heavily against you in financial aid decisions.
The absolute best strategy would be for her to pay the college directly for your studies without impacting your student aid. Kantrowitz adds that she could also contribute to your 529 plan. Under the accelerated five-year gifting option, each grandparent can give up to $60,000 per grandchild without incurring any gift tax.
Apply for scholarships through one megasite or not
Megasites are great. They collect scholarships from
all over, saving you time. Ben Kaplan, founder of
ScholarshipCoach.com and author of "How to Go
to College Almost For Free," cautions that megasite
offerings are by no means exhaustive and limiting
your search to these will limit your chances of winning.
"The scholarship has to be well-organized to
end up in the database. Smaller scholarships often
are underrepresented," he says.
The more obscure the scholarship, the
fewer the contenders. And don't assume that your grades
aren't good enough to compete. Kaplan says: "There
are tens of thousands of scholarships every year that
all want to reward different things. The Arts Recognition
and Talent Search or project-based scholarships are
not based on grades."
|-- Posted: Sept. 17, 2007