It is important that you start a financial aid file. In it, keep your award letter, letters coming from the federal government and all Student Account statements. This should help with taxes and repayment after graduation.
Do I have to report any grants, scholarships or fellowships to the IRS as income?
Part or all of a grant, scholarship or fellowship may be taxable even if you do not receive a W-2 form. If you are in a degree program, amounts you use for expenses other than tuition and course-related expenses (e.g., amounts used for room, board and travel) are taxable. To determine this taxable amount, add up all grant, scholarship and fellowship awards received in a calendar year, then subtract all tuition, fees, and book and supply expenses. If the remaining amount is a positive number, it must be reported as income. This amount must also be reported on Worksheet C of your FAFSA. If you are not in a degree program, the full amount of the grant, scholarship or fellowship is taxable.
What about Work-Study income? Is this taxable?
Yes. Any money received as the result of work (i.e., Work-Study employment, temporary employment on- or off-campus, some fellowships, etc.) is considered taxable income. You will be asked to file a withholding form (W-4) and you will receive a statement of income and taxes withheld form (W-2) each calendar year. Your taxable earnings from need-based employment must also be reported on Worksheet C of your FAFSA. Questions regarding your withholding status should be directed to the University Payroll Office.
How do I live within my budget?
Look carefully at your budget and figure out how much you have to spend each month. Add the room and board to the personal costs, then divide it by nine months. This should result in a total of $3,223 per month to cover expenses. If you know that these funds will need to cover you for 12 months, you must budget for $2,418 a month. Find AFFORDABLE housing. Remember that you are a student. The more modest you are now, the less you will need to be once you are a lawyer.
Why is it important to budget?
Every budget increase to your Grad PLUS or private loan is unsubsidized. This means that you are accruing interest throughout the year on your loan. A student who borrows $50,000 in private funds over three years at a 6.8% interest rate will have a monthly payment of roughly $800. If you add the federal loans, which will amount to $55,500 with a monthly payment of $600 per month or so, you are looking at paying $1,400 per month after graduation. This is a lot of debt to take on – even for a lawyer!
I'm having trouble making ends meet and managing my finances. Is there somewhere I can get help with this?
Our office provides more services than just processing financial aid applications. If you need help understanding your finances, learning money management skills or repairing your credit, you can make an appointment with the financial aid office and get help with these sorts of issues. Our office also provides a session for students who are graduating to prepare them for financial success after law school.
Are there any helpful websites that can assist me with financial aid, credit, tax, and other topics?
There are a number of websites that can help you investigate financial aid, credit, tax, and other topics, and we have dedicated a portion of our website to assist you in your financial planning.