Unit 3 Review (Paying for College)

Which of the following statements is FALSE about financial aid?

• Financial aid is money that is given to you - you never need to pay it back.
• Financial aid may be awarded to you based on factors such as your financial need, academic performance, or athletic ability.
• Financial aid may include money that you have to pay back later.
• Most full-time students receive some form of financial aid.

What types of money are used in paying for college and in what order should you use them?

• Your money, borrowed money, free money
• Borrowed money, your money, free money
• Your money, free money, borrowed money
• Free money, your money, borrowed money

Grants are generally _________________ while scholarships are generally _________________.

• need-based; merit-based
• merit-based; need-based
• free; require you to pay an application fee
• provided by the federal government; provided by the college you attend

Which of the following might be potential sources of scholarships?

• The company that one of your parents works for
• A local service organization (e.g. the Kiwanis or Chamber of Commerce)
• The college you plan on attending
• All of the above

Your cousin is getting ready to apply for college and is looking into financial aid. Which of the following statements about scholarships and grants she tells you is TRUE?

• "The more money in scholarships and grants that you receive, the less money that you will likely have to borrow to pay for college."
• "You should choose the college that provides you with the most scholarship dollars."
• "It is generally not a good idea to apply for more than 2-3 scholarships."
• "Unless you have a really strong GPA and high test scores, it is probably not worth applying for scholarships since they are so competitive."

Your friend tells you they’ve submitted their FAFSA and they’re ready to start accepting financial aid. What type of aid should they accept first?

• Federal student loans
• Private student loans
• Work study
• Grants and scholarships

All of the following are possible sources of grants and scholarships EXCEPT…

• Government
• Non-profit organizations
• Your parents
• Private businesses

In order to qualify for Federal student loans…

• You must have financial need
• You must file the FAFSA
• You must complete a separate application for federal loans
• You must take out a private loan

A rule of thumb is a broadly accurate guide or principle. Which statement below represents a rule of thumb for how much a student should borrow for their college education?

• A student should borrow as much as a private lender will allow them to borrow.
• A student should borrow no more than 35% of their discretionary income upon graduation from college.
• A student should borrow no more than they expect to make as a starting salary upon graduation from college.
• A student should borrow as much as they expect to earn 10 years after they graduate from college.

You enter college with an interest in becoming a teacher. You do some web research and see that the starting salary for high school teachers ranges from $35,000 to $50,000. Based on rules of thumb we analyzed in the lesson, what is a conservative (safer) amount of student debt to take on?

• More than $50,000
• Double your starting salary or $70,000 to $100,000
• About $50,000
• $35,000