Your Free Financial Aid and Student Loan Guide

Planning for the Cost of College

What does college cost? Understanding the costs of higher education is the first step to finding a strategy to pay for it.

Tuition is the cost of attending classes.

Books can be expensive. Don’t overlook them when figuring your cost.

Room and Board is the cost of a roof over your head – whether that is on campus or off – and food in your stomach.

Fees cover the cost of the many “extras” college students get to enjoy: campus activities, health care, and sporting events.

Supplies can include the cost of using a lab for your chemistry class or buying paints and brushes for an art class.

Personal and Miscellaneous Expenses is the category over which you have the most control. It includes transportation, recreation, and living expenses. Try to enjoy activities that don’t break the bank – like attending campus activities or enjoying the outdoors.

Saving for College

Saving is the best way to prepare for the costs of college. Having cash on hand when the time comes to pay your college bills helps keep down the debt you’ll take away from college.


Hopefully you and your family have been saving for this time. However, just as it’s never too early to begin saving for college, it’s also never too late to start.

Plan to work every summer and consider working part time during the school year. Working will not only benefit you financially but will also give you job experience that will help you after graduation. Look into working on campus as well as off.

Save as much out of each paycheck as possible and don’t forget to save gift money. Set savings goals, like planning to save enough to pay for your books next semester or enough to avoid taking out a student loan.

Every little bit you are able to save will help.

Plus, there are great programs available to help your parents save. Learn more.



Setting a Spending Plan


Setting a spending plan, or a budget, is a good idea for every college student. It’s a great way to keep track of what you’ve spent and make sure you’ll have enough money to cover your expenses in the future, and keep you from having to drop out of school due to debt. What’s most important is that you’re in control of your finances. Being smart about your money now will prevent overwhelming debt when you leave college.


So how do you make a budget that’s going to work? Here are some tips:

Keep it simple
A budget shouldn’t be so complicated that you don’t understand it or don’t want to use it. Begin with many categories and combine them as you become more experienced. For example, you may want to begin by keeping track of groceries, snacks, and eating out as separate categories. However, you may be able to combine these into a general food category once you have a good idea of how much you’ll need to spend.

Be realistic
Keep your budget realistic or you’ll have a tough time sticking to it. Do your best to eliminate excessive spending, but if you realize you’ll never cut a certain luxury (for example, you just can’t give up Friday night movie rentals), don’t expect to keep that area below the amount that will cost. Instead, cut spending from another area you don’t care about as much, like eating out or clothing.

Analyze your spending Look at each expenditure and think about these questions:

  • Was this a need? If so, could it have been purchased for less? Could you plan ahead and stock up when it is on sale? Is there a generic version? Could you buy this second-hand to save money?
  • Was this a want? If so, why did you buy it? Beware of shopping as a form of entertainment and don’t fall into the trap of trying to keep up with your friends. College is not the time to splurge. Being responsible now will help you leave college without excessive debt, leaving more of your money free for spending later.

Make spending choices
Before making a purchase, check out your budget. Can you afford it? Do you really need it? Can it wait another month? Don’t buy things you don’t have the money to pay for. Plan ahead to make sure you have the money to pay for what you need.

Evaluate your income
The purpose of budgeting is to fit your spending to your income, to live within (perhaps even below) your means. If you’ve adjusted your spending as much as you feel you can and it’s still not working, then you have to increase your income. Think about getting a second or better-paying job to help you make ends meet.

Reward yourself
You’ve worked hard, pinched pennies, and made your budget work for you. Way to go! Now how to reward yourself? Instead of spending money, relax, spend time with friends, or take a walk. Think about how good it will feel to escape heavy debt as you leave college.





Top 10 Ways to Save Money at College


Don’t let college debt take over your life. Check out these easy ways to save money at college – you’ll be glad you did later.


  1. Don’t buy what you don’t need. It’s easy to let your money slip away on fun or convenient purchases. You’ll be glad to have the cash available when you really need it.
  2. Don’t get a credit card! If you must have one, shop around for low interest rates and no annual fees. Then only use it for emergencies.
  3. Save money on gas: walk, ride your bike, and share rides with friends.
  4. Whether you’ll be living in a dorm or off-campus, get a roommate to share the expenses and fun of college.
  5. Long distance phone calls are expensive. Look into pre-paid phone cards or use e-mail.
  6. Buy used books – either from the campus bookstore or from a student who finished that class last semester.
  7. Find free fun: Take advantage of on-campus entertainment such as concerts, plays, and sporting events.
  8. Stop eating out. Use your college meal plan or learn how to cook.
  9. Instead of going to the movies, rent one! Or better yet, see if your public library has a video section.
  10. Stay on top of your finances. Bounced checks and late fees can quickly drain your money away.

Keep in mind that college isn’t the time to splurge. Staying out of debt now will mean more freedom later!





You and your parents have saved what you could. You applied for scholarships and accepted financial aid. What else can you do to help with college expenses? Get a job!


There are several reasons you should work as a college student, even if it’s only during summer vacations.

Obviously, the main reason to work is to get paid. Your job can pay a portion of the many bills that college students face – books, tuition, living expenses, etc.

Work experience
Having a job now and developing experience and skills will help you find a career when you graduate. Your college may even be able to help you find a job related to your field, giving you an idea of what that work will be like.

Meeting people
Another great benefit of working is the chance to meet new people, make new friends, and develop new interests.

Once you choose to get a job, you’ll need to decide what kind of job is right for you.

Summer jobs
Summer break gives you a chance to work full time, helping you save up money to help you throughout the school year.

Federal Work Study Program
If you’re eligible for work study, it will be offered as part of your financial aid award package. This program gives you eligibility to search for work on campus or off and is funded by the federal government. The number of hours you will work will depend on the amount you are awarded and your class schedule.

Off Campus Jobs
Working off campus can give you a great chance to learn more about the world outside your college. However, remember that you’ll have special considerations, like transportation. And you may not be able to go home for holidays or during the summer and still expect to keep your job.



Finding Money for College

Understanding Financial Aid


Understanding financial aid brings you one step closer to achieving your dreams. The responsibility for paying for college lies with you and your family. You will be expected to contribute to financing your education to the extent that you are able.

The financial aid office at the college will determine your eligibility for financial aid using the following formula:

Your college’s cost of attendance 
-  Your family’s Expected Family Contribution
= Your financial need

Your Expected Family Contribution is the amount you and your family will be expected to pay toward your education in the academic year. This figure is determined by the information you will provide on your Free Application for Federal Student Aid (FAFSA) and is based on your dependency status, family size, income, assets, age of older parent, and the number of family members enrolled in college.

The financial aid office will do everything possible to meet your financial need through their packaging guidelines in putting together your aid package, which may include the types of financial aid listed below.


What is the best way to pay for college? With money that you don’t have to pay back. Scholarships award money to students who demonstrate certain characteristics such as:

  • Academic accomplishments
  • Athletic ability
  • Community service
  • Special interests
  • Where you were born
  • Where you or your parents work
  • Religious affiliation
  • Talents
  • Native language
  • More

Check with the following for information on scholarships:

Each of these free sites offers you a scholarship search. To apply for the funds, you must request and complete the scholarship application forms, many of which will require you to write an essay. Keep in mind that compiling all of the necessary information for scholarship applications can be time consuming, but well worth the work.

The following scholarships are for students from South Dakota planning to attend a South Dakota college.

Start searching for scholarships as early as possible, and continue throughout your education.

Make sure you avoid scholarship scams. Never pay money to apply for a scholarship, and never pay money to hire someone to search for scholarships on your behalf. Scholarship information is available free of charge.



Grants do not have to be repaid and are often based on financial need. Your eligibility for many grants is based on the results of your Free Application for Federal Student Aid (FAFSA).

Federal Pell Grant
The largest grant program is the Federal Pell Grant Program and is often considered the foundation of your aid package. Its purpose is to make sure that all eligible students have some money to continue their education after high school. The amount of each Federal Pell Grant depends on your financial need, cost of education, and the amount of time you are enrolled during the academic year. The maximum award per academic year is currently $4,731 (The limit will be $6,490 for the 2009-2010 award year.). A Federal Pell Grant is often combined with other aid.

To be eligible, you must:

  • Show financial need
  • Be enrolled as an undergraduate student and have not already received a Bachelor’s degree
  • Be enrolled at least half-time in an eligible program of study
  • Be a U.S. citizen, permanent resident, or meet certain citizenship requirements

Federal Supplemental Educational Opportunity Grant
The Federal Supplemental Educational Opportunity Grant (SEOG) is designed to supplement other sources of financial aid for students with financial need. These grants are awarded first to those students with exceptional financial need or low Expected Family Contribution (EFC), and who have been awarded a Pell Grant. An SEOG ranges from $100-$4,000.

To qualify for an SEOG, you must:

  • Be enrolled at least half time
  • Be enrolled as an undergraduate

Academic Competitiveness and National Science and Mathematics Access to Retain Talent (SMART) Grants
Starting with the 2006-2007 academic year the Academic Competitiveness and SMART Grants are available to students who are:


  • U.S. citizens
  • Attending a two year or four year degree granting school
  • Full-time students enrolled in a degree program
  • Eligible for a Pell grant

The Academic Competitiveness and SMART Grants amounts include:

  • $750 for the first academic year
  • $1,300 for the second academic year
  • $4,000 for the third or fourth academic year

Academic Competiveness Grant
If there are more eligible students that qualify for the grants than there is money, the grant amounts could change. The amount received, in combination with the Federal Pell Grant and other financial assistance, cannot exceed the cost of attendance.

Students enrolled or accepted for enrollment in the first academic year must:

  • Have successfully completed, after January 1, 2006, a rigorous secondary school program of study, and
  • Have not been previously enrolled in a program of undergraduate education

Students enrolled or accepted for enrollment in the second academic year must:

  • Have successfully completed, after January 1, 2005 a rigorous secondary school program of study established by a State or local educational agency and recognized as such by the U.S. Secretary of Education, and
  • Have obtained a cumulative grade point average of at least 3.0 at the end of the first academic year of such program of undergraduate education

For students who are in their first or second academic year during the 2006-2007 award year, the U.S. Department of Education (Department) will notify each federal student aid applicant who is potentially eligible (based on information provided on the Free Application for Federal Student Aid [FAFSA]) for these grants. The notification will provide information about a web site that will help the student determine whether he or she completed “a qualifying rigorous secondary school program of study.”

Students enrolled or accepted for enrollment in the third or fourth academic year must:

  • Be pursuing a major in the physical, life, or computer sciences, mathematics, technology, or engineering, or Be pursuing a major in a foreign language that the U.S. Secretary of Education, in consultation with the Director of National Intelligence, determines is critical to national security of the U.S., and
  • Have obtained a cumulative grade point average of at least 3.0 in the coursework required for the major

For students who are in their third or fourth academic year, the school should already have all of the information needed to determine a student’s eligibility. In implementing the SMART Grant, the Department expects that schools will identify Pell-eligible federal student aid applicants majoring in the eligible fields. The institution will determine which students meet all of the SMART Grant eligibility requirements.

Application Procedures
It costs nothing to apply for a federal grant programs. The first step is to contact the Financial Aid Office at the college you plan to attend and to complete the FAFSA. For more information, call 1-800-4-FED-AID (1-800-433-3243) or visit

State Grant Programs
Some states offer grant programs to college students. Check with your high school counselor or college Financial Aid Office to find out more. Please note that South Dakota does not have a state grant program.



Federal Work Study Program

The Federal Work Study Program (FWS) provides students with part-time jobs to earn money for their college expenses. Work Study is offered as a part of a financial aid package to students who qualify. Your eligibility and the number of hours you are allowed to work will determine your award amount.

Receiving a Work Study award gives you the eligibility to seek employment. It does not guarantee you employment. Your college either places you in a job or provides a listing or contact information of jobs either on campus or off. The college may try to place you in a job related to your course of study or career plans.

This program promotes work that is in the public interest. Off-campus positions may include working for nonprofit organizations or public agencies. The college will pay you at least minimum wage for the hours you work.

Application Procedures
It costs nothing to apply for Work Study. The first step is to contact the Financial Aid Office at the college you plan to attend and to complete the FAFSA.
Federal Perkins Loans

A Perkins Loan is a low-interest loan for students with financial need. This program allows you to borrow money from the federal government through your college. Each participating college receives funds from the government and the Financial Aid Office distributes them according to student eligibility.

Perkins borrowers may borrow up to $4,000 per year for undergraduates. The total you can borrow is $20,000. (The limit is higher for students who attend a graduate or professional school.) You will begin to repay this loan nine months after you graduate, leave college, or drop below half-time enrollment.

You must repay this loan within 10 years.

Application Procedures
It costs nothing to apply for a Perkins Loan. The first step is to contact the Financial Aid Office at the college you plan to attend and to complete the FAFSA.

For more information, call 1-800-4-FED-AID or visit

Federal Family Education Loan Program (FFELP)

The FFELP Program includes these loans:

The Federal Stafford Loan is available for eligible students to borrow. The college determines your eligibility for a Stafford loan. Participating lenders make the loans, which are guaranteed by a guarantor. Stafford loans are either subsidized or unsubsidized.

If you are eligible for a subsidized Stafford loan, the federal government will pay the interest on the loan while you:

  • attend college at least half-time
  • are in your six-month grace period after you graduate or cease at least half-time attendance
  • are in an authorized deferment

The unsubsidized Stafford loan has all the same terms as the subsidized Stafford loan; however, you are responsible for the interest at all times. The federal government DOES NOT pay any interest for you.

The Federal PLUS Loan is available to help cover educational expenses for:

  • Parents, or in certain circumstances, stepparents, of dependent students; and
  • Loans certified by the school on or after July 1, 2006, to graduate and professional students.

The borrower must meet federal and lender credit guidelines to qualify for a PLUS loan.


Interest begins accruing on the PLUS loan on the first disbursement date. The federal government DOES NOT pay any interest on the loan. Your parent must begin repaying the loan within 60 days after the final disbursement.

Check out Get a Student Loan or visit the U.S. Department of Education’s Funding Education Beyond High School: The Guide to Federal Student Aid for more information on the Stafford and PLUS loans.


Are you sure you really need a student loan?

or Unsubsidized with Interest
Payments Made
While in School
with Interest Payments
Amount Borrowed
Total Cost of Loan
Monthly Payment
Total Cost of Loan
Monthly Payment

*This is an estimate. Your actual payment and total cost of loan will depend on when you borrow the loan, your interest rate, and whether you make paymentw while in school.

There are several ways to reduce the total cost of your student loan borrowing:

  • Borrow less.
    • Live like a “poor” college student.
    • Explore all other financing options, including scholarships, grants, work-study, and other part-time work
  • Borrow only subsidized Stafford loans, if you are eligible. Then the government will pay the interest for you while you are in school and during authorized grace and deferment periods. And you will get a lower interest rate.
  • Make interest payments while you are in school, if you borrow unsubsidized loans.
  • Make principal payments while you are in school, and pay ahead on your loans during repayment periods. There is no penalty for early repayment of Stafford or PLUS loans.

Military Programs
The military may be a good option for you to consider as a way to finance your education. The sites below provide more information on these programs:


FinAid – Military Student Aid
Mapping Your Future Military Careers and Educational Benefits
My Future
Today’s Military

Tuition Reimbursement Programs
If you are employed, it’s a good idea to check with your employer to see if they offer a tuition reimbursement program. Your employer may encourage you to continue your education and thereby enhance your job security. Programs may either pay for a portion of your cost of attendance up front or may help in the repayment of your student loans.



Completing the FAFSA

Completing the Free Application for Federal Student Aid, or FAFSA, is one of the best steps you can take on the path to finding money for college.


The information you provide on your FAFSA is used to determine your eligibility for federal student aid.

If you are planning to attend college during the next academic year, you should complete the FAFSA, even if you aren’t sure if you’ll qualify.

If you completed a FAFSA last year, you can save yourself time by completing the shorter Renewal FAFSA.

The FAFSA (or Renewal FAFSA) should be completed as soon after January 1 as possible, but not before. For example, if you plan to attend college in September of 2008, you’ll want to complete the FAFSA as soon after January 1, 2008 as possible, but not before that.

Call your college’s financial aid office and ask about their priority date, the date by which you must apply to take full advantage of the financial aid opportunities that college offers.


    1. Get a PIN
      Your Department of Education Personal Identification Number (PIN), available, is a great tool that will help make the financial aid process quicker and easier for you. Have a parent do the same.The PIN can be used throughout your college career to:

      • Sign your FAFSA electronically
      • Retrieve your FAFSA information over the Internet
      • Access student loan information online
      • More

      Be sure to keep your PIN safe and private. If you forget your PIN or think someone else might know your PIN, request a new one immediately.

    2. Gather the information you need to complete the FAFSA, including the following:
      • Completed tax returns (yours and your parents’)
      • Social Security numbers
      • W2s
      • Bank statements
      • Other financial and business records.


  1. Go to and complete the FAFSA on the Web Worksheet.
  2. Stay at and complete the FAFSA.*
  3. Ask for help. If you have any questions, contact us. You may also call the Federal Student Aid Information Center at 1-800-4-FED-AID (1-800-433-3243).

*You may choose to complete the FAFSA on paper rather then electronically. The paper form may be available:

  • At your local library,
  • Through your high school counselor, or
  • At a college financial aid office.

However, the paper process takes much longer, including weeks of processing time rather than the hours required to process the FAFSA on the Web. Plus, the online version automatically checks for certain errors, which helps avoid even further delays.

Helpful FAFSA Tips

  • Use your full name, as it appears on your Social Security card, on all applications, not a nickname.
  • Keep copies of your financial aid forms and records.
  • The FAFSA will ask for the Federal School Codes for the colleges in which you are interested. These numbers are available
  • Complete the FAFSA accurately and honestly. It is a Federal offense to make false statements or misrepresentations on the FAFSA.
  • If you provide your e-mail address on the FAFSA or other financial aid forms, be sure to check your inbox frequently for financial aid updates and information.


Reviewing the Student Aid Report

After submitting your FAFSA, your next step in the college financial aid process is to receive and review your Student Aid Report (SAR).


What is a SAR?
Your SAR is a report that shows all of the information you provided on your FAFSA. The SAR gives you the opportunity to review your FAFSA answers and correct any mistakes.

How do I get my SAR?
If you provided your e-mail address on your FAFSA, you will receive e-mail notification within 3-5 days that your SAR is ready. The e-mail will include instructions on how to retrieve the SAR electronically. If you did not include an e-mail address on your FAFSA, the SAR will be mailed to your home address within two weeks. You can check on the status of your FAFSA at

What do I do with my SAR?
Read through the SAR carefully. If you find no mistakes, simply file the SAR away for your records. If you do find a mistake, follow the instructions provided on the SAR to make the correction(s).


Comparing Award Letters

Once they’ve received the information from your FAFSA, colleges will begin sending you award letters.

What is an award letter?
Award letters come from the college’s financial aid office and outline the financial aid package you will receive at that college.

How can I use my award letter?
Use your award letters as a factor in determining the right college for you.

What do I do now?
Once you’ve made a final college choice, complete that college’s award letter:

  • Accept the aid you are interested in – especially scholarships, grants, and work-study offers.
  • Decline any loans you don’t absolutely need.
  • Sign the award letter (if required).
  • Return the award letter to the financial aid office (if required).

Contact the colleges you have decided not to attend and let them know of your decision.


Tax Savings

While you are in college or repaying a student loan, there are tax savings you may be eligible for. Click here to learn more.


Financial Aid and Scholarship Help is Free

The financial aid process can seem overwhelming. But help is available and it’s free. Check with:


  • High school counselors
  • College financial aid offices
  • The local library

The Internet can also be great source of information. A great online source of financial aid information is Mapping Your Future. Visit their site at:

Follow these tips from the Federal Trade Commission to help you make wise decisions:

  • Don’t be pressured or rushed into spending your money for financial aid information.
  • Thoroughly investigate any organization before handing over your money.
  • Be suspicious of representatives who are reluctant to answer questions about their service.
  • Ask how much is charged for the service, what you can expect for your money, and what the company’s refund policy is. Get this information in writing.

Above all, remember that you don’t have to pay for this information and that any offer that sounds too good to be true probably is.

Click here for more information on scholarships and financial aid.


Native American Students Transitioning to College

Finding college and financial aid information specific to Native American students can be difficult, but we are here to help.

Click here to view web sites and other information on:

  • Preparing for college
  • Paying for college
  • Adjusting to college life
  • Scholarships for Native American students
  • Tribal information
  • And more!