Financial Aid and Scholarship

Financial aid are funds awarded to the student to pay for education. Funds may be from federal, state, university, and/or private sources and include grants, work-study, scholarships and loans.

Common Types of Financial Aid
- Financial Aid for Noncredit Training
- Financial Aid for College Education
How to Apply for Federal and State Grant and Loan Programs
Additional Information on Scholarships

The cost of higher education

The cost of higher education to students has a direct impact on access, so that increases in cost are understandably of great concern to students, parents and education policymakers. According to the National Center for Education Statistics, many important questions about higher education are related to its cost. Is higher education a good investment for students? Is higher education affordable to students from middle income families? Is higher education accessible to students from low income families? Is higher education a good value?

While there are many questions around the cost of higher education, the fact is that tuition and fees have increased at all types of higher education institutions over the last decade. The escalating cost of higher education is causing many to question the value of continuing education beyond high school.

Higher education is an investment for you, your family and the children in your care.

In order to determine whether higher education is worth the investment, it is useful to examine what is known about the value of higher education and the rates of return on investment to both the individual and to society.

Higher education has an economic value. Research shows that the rate of return on investment in higher education is high enough to warrant the financial burden associated with pursuing a college degree. Though the earnings differential between college and high school graduates varies over time, college graduates, on average, earn more than high school graduates.

These sizeable differences in lifetime earnings put the costs of college study in realistic perspective.

College graduates have in general a better life. College graduates have:

higher levels of saving
increased personal/professional mobility
increased empowerment with broad knowledge and transferable skills
increased participation in civil and public affairs
a healthier lifestyle and lower health risk
lower probability to commit crime
less reliance on public welfare systems
improved quality of life for their offspring
better consumer decision making, and
more hobbies and leisure activities

Higher education results in lower health risk. Research has also consistently shown a positive correlation between completion of higher education and good health, not only for oneself, but also for one’s children. In fact, parental schooling levels are positively correlated with the health status of their children.

Higher education has a public benefit. Public benefits of attending college include increased tax revenues, greater workplace productivity, increased consumption, increased workforce flexibility and decreased reliance on government financial support.

Higher education has a social value. A number of studies have shown a high correlation between higher education and cultural and family values, and economic growth. Studies have shown that there is the tendency for more highly educated women to spend more time with their children; these women tend to use this time to better prepare their children for the future.

Higher education has higher outcomes in early childhood education and care. The National Institute on Early Education Research said that teachers who have career development opportunities, such as earning a four-year college degree, are better equipped to provide high quality early childhood education and care than are teachers who have had professional development classes in child development. In addition, research has shown that adults internalize teaching behaviors, and, as a result, teachers who are well-prepared through education can appropriately engage in teaching practices that are research based. High quality early childhood education makes a positive difference in the developmental outcomes of children. Better-educated teachers expose children to larger vocabularies and construct better, individualized lesson plans.

Young children’s learning and development depend on the educational qualifications of their teachers. Better-educated teachers have more positive, sensitive, and responsive interactions with children and provide richer language and cognitive experiences.

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Common Types of Financial Aid

Financial Aid for Noncredit Training

T.E.A.C.H. (Teacher Education And Compensation Helps) Early Childhood® MINNESOTA seeks to improve education and compensation for child care providers while reducing turnover rates. Scholarships are available to cover CDA assessment fees for providers seeking this credential. TEACH offers scholarships to child care providers who want a CDA and covers 85 percent of the CDA Assessment Fee.

Professional Development Grants: Child Care Resource and Referrals (CCR&Rs) build connections for providers and programs by promoting the professional growth and development of child care program staff and family child care providers through grants, resources, training, consultation and mentoring. Opportunities to apply for funding occur periodically throughout the two-year time period. Local CCR&R agencies disburse the funding through use of a local Proposal Review Committee. For more information about professional development grants, visit your local Child Care Resource and Referral or visit www.mnchildcare.org/ccrrmap.php for a map of CCR&R regions.

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Financial Aid for Your College Education

The cost of attending higher education includes tuition, books, supplies, room and board, transportation and personal expenses. This is not the amount that you pay the college. It is an estimate of the cost to cover the above items.

Much financial aid for students at colleges and universities comes from federal and state grants, which you do not need to pay back. Eligibility is based on your need. Grants, loans, work-study and scholarships may be available.

You also may be able to take out student loans at reasonable interest rates, but they need to be repaid later.

T.E.A.C.H. (Teacher Education And Compensation Helps) Early Childhood® MINNESOTA seeks to improve education and compensation for child care providers, while reducing turnover rates.

TEACH is a scholarship program that helps child care providers earn a college degree in Early Childhood Education or Child Development. The scholarship pays for a large portion of college tuition and books and also provides assistance with transportation and substitution costs. Successful scholarship recipients also qualify for a pay raise or bonus upon completion of their scholarship contract.

TEACH offers scholarships to child care providers who want an associate’s degree or a bachelor’s degree.
TEACH covers 80 percent of the cost of tuition and books for associate’s and bachelor’s degree students seeking a degree in child development or early childhood education.
TEACH also offers money for travel, release time and a bonus (if applicable to the scholarship).

For more information about the TEACH Minnesota program, visit their Web site at www.mnchildcare.org/TEACH.

Federal Pell Grants: The Federal Pell Grant is the largest federal grant program for students. It is specifically targeted at the neediest students in the country. The Federal Pell Grant is not a loan, so it does not have to be repaid after you graduate. The amount of the Federal Pell Grant award varies by enrollment level—full time, three-quarter time, half time and less than half time. Federal Pell Grants are “portable,” meaning that if you qualify for a Pell Grant at one school, you are likely to qualify for a Pell Grant at other schools. Pell Grants are limited to students who have not yet received a bachelor’s degree.

Federal Supplemental Educational Opportunity Grant: The FSEOG is another grant program for the very neediest students. Unlike the Pell Grant, however, each school awards the FSEOG from its allocation, so awards will vary from school to school. FSEOG funds are also limited to those who have not yet received bachelor’s degrees.

Minnesota State Grant: The Minnesota State Grant program is the largest grant program to students administered by the state. Minnesota State Grants are similar to Pell Grants in that they do not have to be repaid after graduation, and they are portable. However, because the Minnesota State Grant is based in part on the tuition cost of the school, there will be some variance in award amounts from school to school.

Minnesota Postsecondary Child Care Grant: The Child Care Grant program provides grant funds to students who need assistance with child care expenses while attending school. The Child Care grant program requires a separate application.

Federal Stafford Loan (Subsidized and Unsubsidized): The Federal Stafford Loan program are funds that you borrow for your educational expenses now, but which you repay (over time, with interest) after you graduate or cease attending school at least half time. Subsidized loans are that portion of the loan on which the federal government pays the accruing interest for you while you are in school, in your grace period and during any subsequent period of deferment. Unsubsidized loans accrue interest throughout the life of the loan, but during your in-school, grace and deferment periods, the interest accumulates and is later added to the principal balance of the loan. This allows you to make no payments on either the subsidized or unsubsidized loan while you are in school, in grace or in a period of deferment.

Minnesota SELF Loan: The Minnesota SELF loan is a loan for Minnesota residents. Students may borrow from the Minnesota SELF loan program, so long as the student can obtain a creditworthy coborrower. Usually the coborrower is a parent or another adult relative, and the coborrower is equally responsible for repayment of the loan as the student. Interest payments begin on the SELF loan immediately after disbursement, and repayment of principal and interest begins after the student stops attending at least half-time. Application information for the SELF loan can be found on the World Wide Web at www.selfloan.org.

Private Education Loans: Private education loans (also known as alternative loans) are education loans made by banks and other education finance entities that are intended to supplement the Federal Stafford loan program. Students who wish to borrow a private education loan must meet a minimum credit score established by the lenders as well as other criteria. Most lenders on our recommended lender list for Federal Stafford loans also offer private educational loans.

Federal Work-Study Program: The Federal Work-Study program provides funding to support the employment of students in a variety of on-campus and off-campus jobs. Students who are employed under Federal Work-Study earn an hourly wage and are paid every two weeks. Earnings from the Federal Work-Study program are typically used to pay for a student’s indirect educational expenses, rather than applied to tuition and fee charges on the student account.

State Work-Study Program: This program is similar to the Federal Work Study program, but eligibility for the program is limited to residents of the state of Minnesota.

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How to apply for financial aid

Complete a Free Application for Federal Student Aid, or FAFSA form. You can complete the form online at www.fafsa.ed.gov or pick up the form at the financial aid office at the college or university you plan to attend.

This form must be completed by all students and parents who apply for federal student aid and Minnesota State Grant funds. It also is used to apply for funds from most colleges and universities.

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Additional Information on College Scholarship

For more information about privately funded or noninstitutional-based scholarship opportunities, visit the following scholarship search sites:

FastWeb helps students make the decisions that shape their lives: choosing a college, paying for college, and finding jobs and internships. At the heart is FastWeb’s industry-leading scholarship database. Updated continuously by the company’s own dedicated research team, FastWeb’s database contains over 1.3 million scholarships worth over $3 billion. For more information, visit their Web site at www.fastweb.com.

Since 1998, Scholarships.com’s free scholarship search has been a valuable resource for finding money for college, with more than 3,000 scholarship sources worth up to $3 billion. Scholarships.com’s privacy practices have been approved by both TRUSTe and BBB Online. For more information, visit their Web site at www.scholarships.com.

College Answer is the Internet’s premier guide to college admissions and financial aid. It offers advice and tools to expedite, simplify, and optimize the admissions and financial aid processes. For more information, visit their Web site at www.collegeanswer.com.