Two major formulas are used to determine eligibility:

1. Student Aid Index (SAI) = Parents' wages/income + Student's wages/income
2. Demonstrated Need = Cost of Attendance - SAI

   Data on the FAFSA determines the SAI. To estimate your SAI, try the Federal Student Aid Estimator.

You must meet the following criteria to be considered for federal and some state financial aid:

• Complete and submit the Free Application for Federal Student Aid (FAFSA)

• Be a U.S. citizen or eligible non-citizen
• Have a valid Social Security number (with the exception of students from the Republic of the Marshall Islands, Federated States of Micronesia, or the Republic of Palau)
• Be enrolled or accepted for enrollment as a regular student in an eligible program and working toward an eligible degree or certificate program
• Be enrolled at least half-time to be eligible for Direct Loan Program funds
• Make satisfactory academic progress in college or career school
• Sign the certification statement on the Free Application for Federal Student Aid (FAFSA) stating that:
  • you are not in default on a federal student loan and do not owe money on a federal student grant , and
  • you will use federal student aid only for educational purposes
• Show you're qualified to obtain a college or career school education by:
  • having a high school diploma or a recognized equivalent such as a General Educational Development (GED) certificate;
  • completing a high school education in a homeschool setting approved under state law (or --if state law does not require a homeschooled student to obtain a completion credential --completing a high school education in a homeschool setting that qualifies as an exemption from compulsory attendance requirements under state law); or
  • enrolling in an eligible career pathway program and meeting one of the "ability-to-benefit" alternatives described below.

In addition to completing the FAFSA, students applying to one of the approximately 250 colleges and universities in the U. S. that also use the College Scholarship Service (CSS) Profile should also file that form. The CSS Profile is used by these colleges and universities to identify students who may need financial aid that is not identified by the FAFSA. For information about the CSS Profile, go to CSS/Financial Aid PROFILE and submit a completed Profile.

To receive institutional and other need-based aid, be sure to check the specific requirements of the institution or program.

Kathy Ruby is the director of financial aid at St. Olaf College in Northfield, Minnesota. She says some people incorrectly assume that they make too much money to qualify for financial aid.

"They should go through the process to see if they will qualify. They might be eligible," she says.

Another common myth, Ruby says, is that if you save money, you will be penalized and won't receive any financial aid. Families with savings might receive less need-based aid, but most federal aid is calculated based on income and not assets, she says.

"Saving for college is a good thing, and it gives you many more options," she says.

Max Kahlhamer agrees. The University of North Dakota aviation student says that is his main piece of advice for high school students planning to attend college.

"Save -- and don't spend money on stupid things," he says.