Daily Aid 16: The Coming Financial Aid Crisis

Let’s pull together a few threads quickly.

KSBY said that 8.9 million students filed for financial aid in the first half of 2008, up 16% from the year before. (7,672,000)

Inside Higher Ed reports up to 32% increases in federal financial aid applicants in 2008.

When you sit down and look forward into the future, into 2009, it rapidly becomes apparent that more and more students are applying for and qualifying for financial aid at a time when less aid is available. Appropriations for grants and federal student loans are relatively unchanged, while private student loans (non-government student loans) are less available due to the credit crisis.

Let’s assume that the 16% trend holds. Next year, 10,324,000 students will file the FAFSA if you assume at 16% increase in applicants again, which is not unreasonable given that joblessness has increased and many large companies such as Lehman Brothers have simply gone bust.

If 800,000 extra students can cause a shortfall of $6 billion in Pell Grants, then 2,652,000 extra students will cause a short fall of close to $20 billion.

Put another way, Congress allocated $14 billion to fund 7,672,000 Pell Grants at roughly $1,824 per student.

If increases in qualified financial aid applications spike as predicted, the amount allocated per student drops to $1,356 per student - nearly $500.

For a lot of low income students, $500 is a make or break amount, enough that it will decide whether the student attends college or not.

This is clearly a major problem in the making. In ordinary times, asking for an additional $20 billion for higher education from Congress is difficult at best, because Congress simply places higher education at a lower budgetary priority than other national priorities. However, we’re not in ordinary times. We’re about as far from ordinary times as you can imagine. Congress and the Federal Reserve Bank are spending every available dollar trying to bail out major financial institutions - the money for additional higher education spending simply isn’t there right now.

What you have, in other words, is a quickly approaching financial aid crisis, a college crunch of sorts, that will hit as soon as January 2009 rolls around and the filing window for the 2009 FAFSA opens. More students will be competing for fewer dollars than ever, and there’s a very real possibility that a significant number of students will not get aid even if they’re qualified, because federal aid is allocated on a first come, first served basis.

Here’s the lesson in all of this, in what you must do. Take the time now to start making preparations for filing your FAFSA in January 2009. Apply for as many scholarships as you can, because external scholarship availability hasn’t been affected by the economy yet. Plan to be incredibly aggressive in your quest for financial aid, because you’ll need to be. You’re competing with your fellow students more than ever for fewer dollars.

While I don’t want to encourage panic, I do want you, my listeners and readers, to be wholly prepared for what’s coming. It’s not going to be pretty, but if you’re prepared, forewarned and forearmed, you’ll weather this financial aid crisis better than most.

Update: Read Part 2 of the Coming Financial Aid Crisis.

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FAP877: Wishful Presidential Address on the Economy

After a rough ride on the markets, I thought a friendly voice might help a little, and in good fun, this is what I wish our politicians would say but probably won’t.

Click the play button to listen now:

–

Good evening, my fellow Americans and everyone else tuning in, too. Today was a historic day for several reasons. First, your Congress, for the moment, listened to you when you said no to corporate welfare, no to the big bank bailout of 2008. There was an equally historic fall of the markets on Wall Street, which I’m sure the papers will label as something hysterical like financial armageddon.

It is not. This is not financial armageddon. This is not the end of the line for America. Not a single stalk of wheat wilted at the collapse of a major bank. Not a single ear of corn decided to throw in the towel after checking its investments. The sun came up today and it will come up tomorrow no matter what happens on the markets, because the markets are only a small part of America.

There will be impacts to all of this. Some loans will be harder to get in the coming days and weeks ahead. Some more banks will fail, almost certainly. Some more investment firms and other financial services will take a hit, almost certainly.

My friends, what we’re dealing with is essentially poison in the veins of our financial system, poison from irresponsible borrowing and irresponsible lending. Lenders who gave too freely and borrowers who bit off more than they could ever have chewed.

Like any poison, the only way to truly cure what ails us is to let time and nature flush the poison out of us. We can and should do what is practical to lessen the pain, but not at the cost of prolonging the poison, or worse, injecting more poison into ourselves by further borrowing from tomorrow to pay for the mistakes of yesterday.

Banks, businesses, and yes, homeowners, do need to be allowed to fail. This is harsh but true, and again the only way to get the American economy back on track. Flush out the garbage loans, flush out the debts that will never be repaid no matter how many bailouts you try, and reboot, in essence, our financial system.

Once the markets have been allowed to reach bottom naturally and quickly, we can start to think about our prospects for the future. Over the past 25 years, we’ve heard a lot about supply side economics, or trickle down economics, where you allow the wealthiest to prosper and hope that the money trickles down to everyone else. It’s time for trickle up, or grassroots economics, where we do as much as possible to encourage individuals to make smart financial choices and then get out of their way.

The first step in trickle up economics is to immediately make tax free for at least two years any income earned from saving money in FDIC insured accounts. This means checking accounts, savings accounts, FDIC insured money market accounts, and Treasury bills and bonds. We need to encourage and provide economic incentives for more Americans to save money rather than spend it, to reward putting something aside for the rainy days rather than hoping the sun will shine every day. This will also have the net effect of helping to recapitalize banks who need the cash.

The second step in trickle up economics is to mandate financial literacy education at all levels in our educational system. So many Americans made poor choices not out of malice, but of ignorance, of not knowing what they were getting into. If we as a nation are in a spending mood, spending money to include comprehensive financial literacy at all levels of education from kindergarten to college is a wise investment. Millions of Americans can’t balance a checking account and have no idea how to read a mortgage contract, and that fundamental skill gap is a major contributor to our current problems.

From there we need to create jobs. Tax incentives to companies that opt to bring jobs to America are a start, but more important, if we’re going to spend money, let’s invest it in America by building infrastructure and citizenship. If we look to the past, the Tennessee Valley Authority, the Eisenhower Interstate System, the Civilian Conservation Corps, the Montgomery GI Bill that sent 8 million returning veterans to college, all were major forces for creating prosperity out of decay. Investing in our roads, rail, transit systems, investing in our energy infrastructure, investing in our schools will all create jobs but also create a solid foundation for the next generation to build on.

Finally and most fundamentally, the root cause of this entire mess was irresponsible lending and borrowing, but the chief symptom of the problem is too many houses for not enough buyers. We either need more buyers or fewer houses. Some houses currently in foreclosure or bank owned can be bought directly by the government or even private agencies like Habitat for Humanity for rehabilitation.

For the rest, we need to get buyers willing to buy the houses with borrowed money. If the government is in the mood to spend money, then create a program similar to the Federal Direct Student Loan Program, which allows borrowers to borrow directly from the government. The Federal Reserve Bank allows banks to borrow at the funds rate, currently 2%, which presumably is enough to fund the administration of the Federal Reserve. Add in an administrative margin of 2% and create a loan program that allows creditworthy consumers and businesses to borrow directly from the government in the same structure as the student loan program.

The emphasis would be on creditworthiness, and would have a similar screening and verification process that the government uses for allocating financial aid dollars, and while the student loan program is far from perfect, it is better than the alternative of 80% fewer college graduates. If we want to stave off foreclosures, letting borrowers get their properties re-assessed for market rates and get existing mortgages refinanced at government rates may be a good short term fix.

None of these solutions are bulletproof or guaranteed cures, but they’re all better than just handing money to banks and hoping they do the right thing. No matter what happens, keep in mind that the basic goodness of America - the willingness for people to work hard for a better life - remains intact, and as long as we provide a functioning system for them to do it in, we’ll succeed as a nation.

Good night, and may the belief system of your choice bless America.

Disclaimer: political opinions are mine and not representative of the Student Loan Network.

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Daily Aid 15: Financial Aid Questions and Answers

Last week, I sent out a quick survey asking you what you wanted from the Financial Aid Podcast and blog. This week, we’re going to tackle some of the questions and answers, along with the regular dose of financial aid and student loan news.

Student Financial Aid News

NASFAA and AP:

“College students have drained Oregon’s financial aid fund, and lawmakers are being asked to put up $4 million more,” the Associated Press reports. “The state set aside $72 million for aid this year. But when the economy sours, students typically turn to higher education in greater numbers. More than 100,000 Oregon students who need help to pay for college are flooding the state’s campuses this fall.”

Commentary

This is unsurprising, and in fact I’ll probably do a special later this week on the coming financial aid crisis, the one we’re just not talking about yet, despite increasing headlines about it.

Here’s the bottom line: financial aid is now something you do and plan for year-round. It’s not just a form or two in January, but a process for making college as affordable as possible. If you’re committed to paying as little for college as possible, it will require year-round effort.

Always be looking for scholarships. Always file your FAFSA early. Always be looking for more ways to save money, be thrifty and frugal, and still enjoy a great college experience, which has less to do with the name of the school and more to do with who you want to be.

Scholarship Update

Have you signed up for the Student Loan Network $10,000 Scholarship yet?

Click here to apply. It takes 32 seconds, it’s completely free, and it’s a shot at $10,000.

Mail Bag

Wayne writes in:

What private loan lenders are left and what do they offer and to whom? Best, W.

There are still a lot of private student loan lenders out there. Corporate plug, we’re one of them. Generally speaking, the easiest way to see who’s still in business is just to Google for the search term and see who’s still advertising with paid ads.

Here’s what you do need to know - average credit scores in America have declined at the same time that lending standards have risen. Where you might have been able to get a private student loan with a FICO credit score of 620 and no cosigner 2 years ago, today that’s a 720 with a co-signer. Virtually every private student loan out there, ours included, requires a co-signer and good credit.

Are there alternatives for families with less than perfect credit? Yes - check out the PLUS loan, which is a federal parent loan. The credit terms for a PLUS loan are a lot more lenient because the government backs the loan.

Thanks for writing in, Wayne!

Conference/Event

Friend and colleague Maria Koklanaris asked me to pass along this paid teleseminar announcement. Normally, I don’t do ads, but this appears to at least be worth mentioning.

Full disclosure: HEWI hasn’t paid the Student Loan Network or Financial Aid Podcast for this.

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+ FAFSA form tutorials and free help at FAFSAonline.com
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Daily Aid 14: Washington Mutual fails, seized by OTS and FDIC, bought by JP Morgan

Special Announcement Edition

You’ll probably just wake up to this blog post, since it’s very early morning, 12:30 AM.

Washington Mutual (ticker: WM) has failed due to a massive run on the bank, losing $16.7 billion in deposits in just 9 days.

As of 10 PM September 26, Office of Thrift Supervision seized Washington Mutual and placed it into receivership with the FDIC, making it the largest bank failure in history.

JP Morgan (ticker: JPM) then purchased the assets of Washington Mutual for $1.9 billion.

What does this mean for you?

If you are a Washington Mutual banking customer with deposits at Washington Mutual, your local bank branch will be open for business today and your cash deposits are 100% safe. Not a single penny of deposits was lost.

If you have invested in Washington Mutual stocks and bonds, your investments are unfortunately no longer worth anything.

If you have federal student loans or private student loans with Washington Mutual, those loans are now owned by JP Morgan. Make sure you contact customer service at the number on your Washington Mutual student loan bill to ensure that your correct mailing address and other contact information is up to date, so when JP Morgan assumes administration of your loan, your payments will be received correctly.

Commentary

The long term consequences of Washington Mutual’s failure and OTS/FDIC seizure will not become clear for some time, but in the meantime, it’s really important for me to emphasize these two points:

1. If you have deposited money at a bank and your money is in an FDIC insured account and you are under the $100,000 limit, your money is safe. The same limits are true of credit unions; they’re insured by the NCUA for the same limits. The FDIC has insured and guaranteed every penny deposited at all FDIC member banks, which is virtually every bank in the United States.

2. If you happen to be a CEO, president, or owner of a company, make sure your payroll is within FDIC limits. Businesses got very lucky with Washington Mutual, as JP Morgan will guarantee all deposits, regardless of amount. The next bank failure, you may not be so lucky.

Finally, if you are saving for college or retirement, consult your financial planner sooner rather than later to make sure your investments are diversified and updated to reflect the ever-changing realities of the market. As always, I am not a financial planner or investment professional; please get your investing advice from someone who is!

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+ Parent PLUS loans at ParentPLUSLoan.com
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+ FAFSA form tutorials and free help at FAFSAonline.com
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Daily Aid 13: Jobcast Special - We are hiring!

Student Financial Aid News

Spelman College created the Starfish initiative to bridge the gap between aid and students.

From Inside Higher Ed:

Coming into her senior year, Alisha McClung learned that her lender, College Loan Corp., had gotten out of the federal student loan business. Unable to register for classes because she couldn’t pay half the semester’s fees, as required, she called Spelman College to confirm just how much cash she needed to come up with. “They told me my balance was a zero balance. I thought it was a mistake.”

No mistake: McClung was the beneficiary of an anonymous donor’s generosity and, more specifically, Spelman’s new Starfish Initiative, which matches donors with students, primarily seniors, at risk of not graduating for financial reasons. Unlike the “Last Mile” scholarships that Spelman has given in the past, which typically are worth relatively small sums — $1,000 to $1,500 for the student who made less than expected in a summer job, or who’s whacked with a particularly high textbook bill — Spelman’s looking to donors to fill much bigger gaps, averaging $10,000 per student who’s short.

The program is named for the well-known allegory about a little girl who’s overwhelmed by the number of dying starfish strewn by a storm onto the beach. The girl then starts throwing starfish back, one at a time. Told by a passerby she couldn’t possibly help them all, the girl threw another back and said, “I helped that one.”

Commentary

This is the sort of innovation and initiative I was talking about recently, and I strongly applaud Spelman College’s management team and financial aid office for creating such a useful idea.

Scholarship Update

Junior Achievement of the National Capital Area is pleased to announce the Junior Achievement Essay Competition, sponsored by David M. Rubenstein.

This fall, Junior Achievement invites students from the Greater Washington Region to compete for a $20,000 award. The competition is open to any student in the 9th - 12th grade from August 18 – October 15, 2008, and asks students to write a 1,000-1,500 word essay on “Greater Washington – Why it’s the Best Region to Build and Grow a Business.” Students are able to submit their essays to Junior Achievement either online or via postal mail.

The first place winner will receive a $20,000 award, will be recognized at the prestigious 20th Anniversary Washington Business Hall of Fame on December 2, 2008, and will have his or her essay published in the January 2009 issue of Washingtonian.

Nine additional runner-up winners will each receive a $10,000 award and be recognized at the 20th Anniversary Washington Business Hall of Fame.

Details at our free college scholarship search site.

We’re hiring!

Level 1 PHP 5.0 Developer/Object Oriented Programmer

We are currently seeking a Level 1 PHP 5.0 Developer/Object Oriented Programmer to work full time in our Quincy, MA office.

This position will be responsible for the development, enhancement, integration and production support requirements of complex web applications. The successful candidate will be a team player, able to cohesively manage and integrate project requirements, and enjoy building dynamic applications in a timely manner.
Responsibilities

* Develop, test, and maintain Edvisors‘ web sites & applications using PHP, SQL, CSS, JavaScript, and HTML
* Debug, modify, and upgrade existing PHP code on a MySQL database
* Support existing and new application functionality using object-oriented development

Qualifications

* 2+ years experience building database-driven web sites is required
* 1-2 years of object oriented PHP 5.0 development experience in a Linux environment is required
* Mid-level MySQL development and administration experience is required
* Front end web development exposure is a plus (XHTML, CSS, JavaScript)
* Strong analytical and interpersonal troubleshooting, and communication skills required
* Excellent organizational skills and strong attention to detail
* Bachelors degree in Computer Science, Information Systems or equivalent

Benefits

* Fun, friendly, team-oriented and collaborative office environment
* Competitive base salary with bonus
* Full medical benefits, disability coverage, 401(k)
* Free garage parking and MBTA-accessible (Quincy Center on the red line)
* Business casual office attire
* Opportunity to work in a successful, fast-growing company

How to Apply

Send an email to jobs@edvisors.com with the subject “Level 1 PHP Developer” and a resume in plain text or PDF format. Alternatively, you may fax us your resume at 617-328-0615.

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+ FAFSA form tutorials and free help at FAFSAonline.com
+ The Financial Aid Podcast is a publication of the Student Loan Network.

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FAP876: Alliance for Young Artists and Writers Scholarship

Listen now:

Expert Interview
+ Bryan Doerries, Associate Executive Directory, Programs, from The Alliance for Young Artists and Writers
+ Doerries on scholarships, writing, and support of creativity in education
+ Award details at our free student scholarship search site

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+ Open an FDIC-insured savings account today!
+ Stafford federal student loans at StaffordLoan.com
+ Parent PLUS loans at ParentPLUSLoan.com
+ Graduate student loans at GradLoans.com
+ Private student loans available at any time - visit AlternativeStudentLoan.com
+ Private student loan consolidation at StudentLoanConsolidator.com
+ FAFSA form tutorials and free help at FAFSAonline.com
+ The Financial Aid Podcast is a publication of the Student Loan Network.

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Daily Aid 12: Planning for 2009 financial aid

Student Financial Aid News

From KSBY and NASFAA:

Some institutions have had trouble finding an on-going source of funding for student loans. “That market is the same market that funds our home mortgages and the other sources that have had some difficulty in the last few months,” said Cal Poly Director of Financial Aid Lois Kelly.

Those same issues are having an adverse effect on student loan programs. Kelly adds, “What they are finding is that some of the lenders they might have used in the past no longer have the funding source, and so they can’t lend to the students.”

The student can choose to get a loan from another lender, but that creates another problem. Kelly goes on to say, “Now they have the potential complication of owing two different lenders, needing to be certain that they consolidate the loans so that in the future they won’t have to make two separate repayments.”

Commentary

As we’ve been mentioning for months now, lending availability continues to be constrained in the general economy, and the turmoil of a massive government bailout isn’t helping. Yesterday I spoke to CNBC about this, and the general message is this: plan for a lack of availability in private student loans and no major availability problem with federal student loans. This way, if you plan as such and things are better than expected, you’ll be pleasantly surprised.

My personal opinion: I don’t see the lending and credit crisis being resolved by the time spring semester rolls around. In fact, I’m relatively pessimistic on the economy right now and would expect the lending issues to persist through next summer as well.

Another prediction: the 2009 FAFSA season is going to be the busiest ever. More students and families will need help than ever before. More people will be competing for an unchanging pool of federal dollars, possibly double the norm.

What does this mean for you? In all seriousness, start doing your FAFSA planning now. Keep careful records of your pay stubs and if you have relatively constant pay, you should be able to estimate your 2008 taxes now. Look carefully at the IRS 1040, especially the second half of the first page, to see what things you can do now to reduce your adjusted gross income, which is one of the key drivers of both the IRS 1040 and the FAFSA. Talk to a qualified financial planner about reducing your tax exposure as much as possible.

Speaking of which, the FAFSA for 2009-2010 is expected to be finalized in late November, according to NASFAA. This doesn’t give a lot of prep time for students to review any major changes, but the draft version available gives some insight about what you’ll need to prepare. The Student Loan Network will have a comprehensive FAFSA tutorial available for the 2009-2010 FAFSA as soon as it becomes available.

Scholarship Update

Catherine B. Reynolds Foundation Graduate Fellowship in Social Entrepreneurship - $50,000

Awarded for two years
Incoming fall-start full-time students are eligible
This program provides fellowships for 23 graduate students among all New York University’s 14 schools each year. Fellows will participate in a newly developed cross-disciplinary course, act as mentors to the undergraduate scholarship recipients, and attend fellowship-related activities
Applicants must submit the Fellowship Application to the Wagner admissions office by January 15

Details at our free college scholarship search site.

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+ Graduate student loans at GradLoans.com
+ Private student loans available at any time - visit AlternativeStudentLoan.com
+ Private student loan consolidation at StudentLoanConsolidator.com
+ FAFSA form tutorials and free help at FAFSAonline.com
+ Get FAFSA news at the FAFSA blog

+ The Financial Aid Podcast is a publication of the Student Loan Network.

I want to hear from you! Email me at financialaidpodcast {at} gmail {dot} com, visit http://www.FinancialAidPodcast.com, or call 206-350-1208.

Daily Aid 11: 5 job trends that will keep you employed

In the midst of all the economic news, you may be wondering what to do, especially if you’re just getting into college now or are thinking about what life after college will be like. While it’s impossible to predict the future with any level of accuracy (just ask a competent weather forecaster what next month’s weather will be), there are some trends that are incredibly obvious and good bets for your future.

Call this, then, eye on the economy and jobcast in one.

Trend 1: Oil

We’re going to run out of oil someday. That’s kind of a given, since dinosaur juice takes a long, long time to make, far longer than the rate at which we use it. Students who have a focus in sciences like mineral and resource exploration will do very well for years to come as we keep trying to find the next energy source while we tap out existing sources. If you can find new forms of oil while the world’s energy systems change over, you’ll do well.

Trend 2: Water

If you think oil is scarce, fresh water is going to become even more scarce. Why? Too many people for too few fresh water resources. There’s a lot of water on the planet, but very little of it is drinkable. Students who have a physics and chemistry focus, as well as mechanical and electrical engineering, will be sought after for projects dealing with water in all of its forms. How can we find or create more water?

Trend 3: Energy

Solar, wind, nuclear, biomass, take your pick. The world is starving for more energy, especially renewable energy with a low environmental impact. Specialists in photovoltaics, batteries, and turbines will be needed desperately by anyone and everyone trying to find improved, more efficient solutions to a never-ending hunger for energy.

Trend 4: Writing

Believe it or not, writing as a skill is becoming increasingly valuable as the pool of competent writers decreases. The ability to write in a focused, concentrated manner is a rare one, especially if you can communicate effectively. Writing skills cross over into dozens of different media, from television to blogs to YouTube. If you’ve got outstanding writing chops, opportunities will abound.

Trend 5: Marketing

Our communications systems are increasingly clogged with messages of every kind, from commercials to political ads to spam. If you’re the person who can cut through the clutter and get your message across with impact, there are a few thousand companies that would like to talk to you very soon. Marketing is more than business. It’s art, music, interactive, design, writing, and communications all in one. If you’ve got a specialty, a knack for any of these areas, you’re likely going to be employed for a very long time.

One of the lessons of the global networked economy is that the long tail and short head matter more than ever. Today, employers have a buffet of choices when it comes to finding talented workers, from regular hires to outsourcing to subcontracting to… well, you get the idea. The old rule of employers just hiring locally is long gone.

In the world of today and tomorrow, your job security depends on you being the very best at what you do. Find a specialty and become the expert in it, because that’s truly your only job security. The company you work with today, no matter how old or prestigious, may be gone tomorrow (Lehman Brothers comes to mind, 158 years old and bankrupt) but its top talent will find new work very quickly. Everyone else who isn’t a top talent will have a much harder time finding work.

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FAP875: Financial aid shakeups, dashboards, pirates!

Student Financial Aid News Roundup

Where to start? With the economy. This week’s economy roundup.

What financial aid administrators need to know about this crisis.

Expert interview later today with scholarship administrator Bryan Doerries

Scholarship Search Secret

The scholarship search dashboard

As always, check out our free scholarship search site, StudentScholarshipSearch.com and our free college scholarships contest site, ScholarshipPoints.com.

JobCast

The job hunting dashboard

Free Stuff Friday
+ Nature’s Bounty Fish Oil
+ FYE 2 free albums
+ Gorilla Glue
+ Kashi oatmeal cookies
+ Redken hair detangling comb
+ Free shampoo
+ Yugma screen sharing
+ VLC 0.9.2
+ Go to Stanford’s online engineering course for free!
+ Joost goes browser based
+ Tourist Remover

Free Song of the Week
+ Tom Smith, Talk Like a Pirate Day

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+ Free scholarship search secrets eBook at StudentScholarshipSearch.com/ebook
+ Free college scholarships contests!
+ Open an FDIC-insured savings account today!
+ Stafford federal student loans at StaffordLoan.com
+ Parent PLUS loans at ParentPLUSLoan.com
+ Graduate student loans at GradLoans.com
+ Private student loans available at any time - visit AlternativeStudentLoan.com
+ Private student loan consolidation at StudentLoanConsolidator.com
+ FAFSA form tutorials and free help at FAFSAonline.com
+ The Financial Aid Podcast is a publication of the Student Loan Network.

I want to hear from you! Send me your comments, questions, and feedback using this handy contact form!

Daily Aid 10: Pell Grant shortages, jobcast job hunting dashboard

Student Financial Aid News

From the New York Times:

Battered by a worsening economy, college students are seeking federal financial aid in record numbers this year, leading Bush administration officials to warn Congress that the most important federal aid program, Pell Grants, may need up to $6 billion in additional taxpayer funds next year.

As of July 31, 800,000 more students had applied for grants than on that date last year, according to the memorandum, which called the increase one of the largest ever year to year.

Congress appropriated $14 billion for the grants for the current fiscal year, but because of the increase and because of accumulated shortfalls from previous years, lawmakers will need to add $6 billion in new funds next year or cut the size of the grants, Department of Education officials said.

“There may need to be an announcement in February 2009,” the memorandum warns, that Pell grants for the following academic year will be reduced.

Commentary

Anyone in higher education finance should have seen this coming from far, far away. We’ve been talking about it on the Financial Aid Podcast here for a long time, as the broader economy heads to the toilet.

Start planning to file your 2009 FAFSA now. Take a look at the requirements in terms of what paperwork you’re going to need to file, and be prepared to file as early as possible. Remember that federal aid, especially need-based, is based on both need and availability. Two people equally eligible who file at different times may get different aid packages or the one who files later may not get anything at all, even if they’re still eligible.

Plan for a lack of availability of certain student loans, especially private student loans. The broader market is in serious upheaval now, and the chances of it getting better by early 2009 are not good. Am I saying for sure that there won’t be private student loans? No. I’m saying plan as if there will be none, so that you don’t count on them.

If you’re not hunting for scholarships every day, you should be. Grab a copy of our Scholarship Search Secrets book, sign up for Scholarship Points, and put together a scholarships dashboard.

Scholarship of the Day

Best and Worst of Back to School Scholarship: Back to school - you either hate it or love it. While new clothes, seeing old friends and looking forward to a fresh start may amp up some students when the school bell rings, other students feel the anxiety when thoughts of homework, lectures and teachers come calling. Share your tips, stories and opinions on what makes going back to school the best or worst time of the year. Scholarship amounts vary, up to $500. Ends November 24, 2008.

Details at our free college scholarship search site.

Jobcast

Check out this job hunting dashboard - incorporating iGoogle, feeds from Craigslist, Google Calendar and Mail, and LinkedIn.

Click on the picture for a larger version.

Dashboards like this are surprisingly easy to put together. We’ll talk about it tomorrow on the audio podcast.

Did you enjoy this? If so, please consider subscribing for free to get it delivered to you. Subscribing for free means you don’t have to remember to download it every day.
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Reminders
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+ Financial Aid Podcast Show Notes at FinancialAidPodcast.com.
+ Free scholarship search secrets eBook at StudentScholarshipSearch.com/ebook
+ Open an FDIC-insured savings account today!
+ Stafford federal student loans at StaffordLoan.com
+ Parent PLUS loans at ParentPLUSLoan.com
+ Graduate student loans at GradLoans.com
+ Private student loans available at any time - visit AlternativeStudentLoan.com
+ Private student loan consolidation at StudentLoanConsolidator.com
+ FAFSA form tutorials and free help at FAFSAonline.com
+ Get FAFSA news at the FAFSA blog

+ The Financial Aid Podcast is a publication of the Student Loan Network.

I want to hear from you! Email me at financialaidpodcast {at} gmail {dot} com, visit http://www.FinancialAidPodcast.com, or call 206-350-1208.