Financial Aid

Financing Reed

Eliot hall picturefall leaves picturestudent studying picture


The Financial Aid Handbook has information for continuing Reed students.

The financial aid package

Sources of financial assistance
Types of financial aid
Outside resources

Back to Financial Aid Handbook contents

The process of combining differing types of financial aid to meet a student's demonstrated need is called packaging. Reed uses equity packaging to distribute federal, state, and institutional financial aid resources. In equity packaging, the first component of a financial aid package is self-help. Self-help is defined as loans and work opportunities. Every financial aid package at Reed has a self-help component that is determined by the student's year in college and level of demonstrated need. The following self-help components will be included as part of a student's financial aid package:

2012-13 Self-help Aid Components

Loans $2,500 first-year students
$3,500 second-year students
$4,500 third-year students
$5,500 fourth-year students
Work $1500 for students with medium to high federal need.


After subtracting the self-help component from a student's demonstrated financial need, a student's remaining need is met with federal, state, and/or institutional grant funding.

Sources of financial aid

Reed's financial aid program includes federal, state, and institutional funding sources. Financial aid may be in the forms of grants, loans, and employment opportunities.

If you qualify for institutional grant funding, your initial financial aid package will include a Reed grant. The Reed grant fund includes funds from the operating budget, as well as income from endowed scholarships and restricted gifts. Over one fourth of the Reed grant fund comes from need-based endowed scholarships and restricted gifts created by alumni, parents, and friends of the college. Each fall, the financial aid office notifies those students whose Reed grant has been funded by an endowed scholarship or restricted gift. Students may be asked to write thank-you notes to the donors of the scholarships that funded their Reed grant.

Types of financial aid

Grants

  • Reed grant: This grant is funded by Reed College and awarded on the basis of financial need to undergraduate students who have not earned a bachelor's degree. Students who have earned a bachelor's degree are ineligible for institutional funding.
  • Federal Pell Grant: This grant is funded by the federal government, and eligibility is determined by the Department of Education based on the information provided on the FAFSA. The Pell Grant is available to undergraduate students.
  • Federal Supplemental Educational Opportunity Grant (SEOG): This grant is funded by the federal government, and eligibility is determined by the Department of Education based on the information provided on the FAFSA. Grants cannot exceed $4,000 per year. The SEOG is available to undergraduate students.
  • Oregon Opportunity Grant: This grant is funded by the State of Oregon and available to full-time, undergraduate residents of Oregon. Eligibility is determined by the Oregon Student Assistance Commission (OSAC) based on the information submitted on the FAFSA.

Loans

  • Perkins Loan: Funded by the federal government, this loan is awarded by Reed College. Repayment and interest accrual (5 percent) begin nine months after you cease to be enrolled at least half time. Loans cannot exceed $4,000 per year; however, the yearly amount included in a financial aid package is based on the availability of funding and the level of financial need.
  • Direct  Loan: The subsidized Direct Loan has an interest rate of 3.4%; the unsubsidized Direct Loan has an interest rate of 6.8%. Eligibility is determined by Reed College, based on the information provided on the FAFSA. Repayment begins six months after you cease to be enrolled at least half time. Loans are either subsidized or unsubsidized. A subsidized loan is awarded on the basis of need, and the federal government pays all interest on the loan until the student enters repayment. An unsubsidized loan is not based on financial need, and the student is responsible for all interest associated with the loan. Federal regulations limit the annual subsidized amount to $3500 for freshmen, $4,500 for sophomores, and $5,500 for juniors and seniors.  An additional $2000 may be borrowed under the unsubsidized program.  The aggregate amount that may be borrowed in the subsidized program is $23,000; in the subsidized and unsubsidized program the total is $31,000. If you are an independent student as determined by the FAFSA, or a dependent undergraduate whose parents are unable to borrow under the PLUS program, you may be eligible to borrow additional amounts under the unsubsidized Direct Loan program. Ask the financial aid office for additional information.
  • Direct PLUS Loan: Direct PLUS Loans are not packaged as a component of the financial aid package, but are available to families who wish to borrow to finance all or a portion of their expected family contribution. The PLUS loan is a non-need-based federal program that allows parents with good credit histories to borrow to pay the educational expenses of their dependent college students. Parents may borrow up to the cost of attendance minus any other financial aid. The interest rate on this loan is 7.9 percent. Repayment begins within 60 days of disbursement with a maximum repayment period of 10 years. There is no federal interest subsidy on the Direct PLUS Loan.

Employment

  • Federal work-study: This federal employment program is administered by Reed. Students may seek jobs on campus through a variety of offices or may find off-campus community service employment opportunities through the SEEDS and Career Services offices.
  • Academic Year Employment: Students not eligible for federal work-study may have academic year employment as part of their award package. Academic year employment can only be used for on-campus jobs.  All students can still earn regular student wages at the college.

Outside resources

The two major types of outside resources are benefits and awards. Outside benefits are funds to which the student is entitled, such as state and federal grant programs or employment-related tuition benefits. Outside awards are generally funded through private sources and selection is based on criteria such as academic achievement or service. The college's ability to meet the demonstrated need of all of all students depends on each student's efforts to obtain and use any and all of the outside resources for which he or she qualifies. If a student is eligible but fails to apply for or declines resources to which he or she would have been entitled, Reed will not replace these shortfalls with institutional grant funds.

Resources from outside of the college reduce your need and consequently affect your eligibility for financial aid from Reed; however, these two types of outside resources have differing effects on the financial aid package. Outside awards, such as privately funded scholarships, will replace or reduce the components of a financial aid package in the following order:

  • Unmet need for students who have demonstrated need but who were not offered institutional aid
  • The difference between the federal and institutional calculation of the expected family contribution (EFC)
  • Academic-year employment
  • Perkins Loan
  • Direct Loan
  • Federal work-study
  • Institutional grant funds (Reed grant)

Outside benefits, such as employment related tuition benefits or need-based federal and state grants, reduce the Reed grant first, then any recommended loans and work eligibility. 

Back to Financial Aid Handbook contents