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Financial Terms Glossary
Financial Terms Glossary
Finance & Financial aid terms can be an alphabet soup of acronyms like FAFSA, SAR, SAP and EFC and technical terminology. It is almost like speaking a foreign language. This glossary defines the terms and acronyms that are most frequently used in basic finance or student financial aid.
Edvisors® allows the use of its glossary content by any college, university, non-profit, or other educational access agency, if the content is linked from the Edvisors® page. At any time Edvisors® may limit use per its Terms of Use policy.
If you filed your FAFSA online but did not provide a valid email address, you will receive a paper SAR Acknowledgement by mail after your FAFSA is processed. Like the SAR (Student Aid Report), the SAR Acknowledgement includes a summary of the information you submitted on your FAFSA as well as your expected family contribution (EFC). To make corrections to your SAR Acknowledgement, log in to FAFSA on the Web at FAFSA.ed.gov.
Satisfactory academic progress (SAP) includes quantitative and qualitative measures of a student’s progress to a degree or certificate. Students must generally maintain at least a 2.0 GPA on a 4.0 scale and be passing enough classes to graduate within 150 percent of the normal timeframe for the degree. For example, a student in a Bachelor’s degree program that normally requires four years of study is considered to be making satisfactory academic progress if the student’s progress is consistent with completion the requirements for a Bachelor’s degree within six years.
A scholarship is a form of gift aid, money that does not need to be repaid. Scholarships are usually awarded by private organizations (e.g., foundations, corporations, associations, individual philanthropists and nonprofit organizations) based on some form of merit, such as academic, artistic or athletic talent, or activities, such as community service. Also called Private Scholarships or Outside Scholarships.
The Federal School Code is a six-digit number assigned by the U.S. Department of Education to a college or university that is eligible for Title IV federal student aid. If an applicant lists a federal school code on the FAFSA, the college or university will receive a copy of the student’s financial aid application data in the form of an Institutional Student Information Record (ISIR).
Special circumstances include significant changes in a family’s financial circumstances from one year to the next or circumstances that differentiate the family from the typical family. Examples include job loss, salary reduction, death of a wage-earner, high unreimbursed medical and dental expenses, high dependent care costs and private elementary and secondary school tuition for a sibling.
A special circumstances review is the process by which a college financial aid administrator reviews, on a case-by-case basis, documented special circumstances affecting a student’s ability to pay for college. During the review, the financial aid administrator may decide to make an adjustment to the cost of attendance or to the data elements on the FAFSA that are used to calculate the student’s expected family contribution (EFC). Some colleges call a special circumstances review professional judgement or financial aid appeal.
A stepparent is a stepfather or stepmother. A stepparent is a parent by marriage, not birth. A stepfather is the husband of a child’s natural mother after the death or divorce of the child’s natural father. A stepmother is the wife of a child’s natural father after the death or divorce of the child’s natural mother.
The Student Aid Report (SAR) summarizes the information you submitted on your FAFSA and includes your expected family contribution (EFC). You'll receive your SAR soon after your FAFSA is processed. You should review the SAR to ensure that the information is accurate and correct it, if necessary.
The student contribution is an estimate of the student’s ability to contribute to his or her cost of attendance. Among the key components comprising the student contribution are base year taxable and untaxed income, net value of assets as of the date of FAFSA submission, family size, number of family members in college, and, possibly, any other documented extenuating or special family circumstances the college is willing to consider. The expected family contribution is the sum of the student contribution and parent contribution.
The U.S. Department of Education pays the interest on subsidized federal student loans, such as the Federal Perkins Loan and the subsidized Federal Stafford Loan, while the student is in periods of authorized deferment, such as the in-school deferment and the economic hardship deferment.
The Federal Supplemental Educational Opportunity Grant (FSEOG) is a grant to low-income undergraduate students who demonstrate exceptional financial need. Exceptional financial need is defined as the students with the lowest expected family contribution (EFC) at the school, with a preference for Federal Pell Grant recipients. Part of the FSEOG funding is provided by the school and part by the federal government. The FSEOG program is a form of campus-based aid.
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