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A Comprehensive Guide to Financial Aid for Massage Therapy School

Dec 1, 2014 1:05:00 PM by MTTI

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The volunteers at MTSI have compiled this comprehensive massage therapy school financial aid guide after spending weeks brainstorming and collaborating with each other.

Many of our volunteers graduated from massage school without taking out any loans or alternative debt, and they did this by receiving a combination of free financial aid and scholarship awards. You can do the same by following this guide.

 

The Various Financial Aid Options Available to Massage Therapy School Students

massage school financial aid ebook

One Very Important Consideration When Evaluating Massage School Tuition & Fees

One important consideration before even learning about the various financial aid alternatives available to you is to understand the core difference between accredited and non-accredited massage therapy schools. Federal Financial Aid (discussed in detail below) is the most common source of financial aid for any type of post high school education. It is also the easiest to obtain providing that you qualify for it (qualification requirements are also discussed below).

When evaluating massage therapy schools to attend, you will generally find that a school is either accredited or non-accredited. The biggest and arguably only difference that you need to know between this is the fact that accredited massage therapy schools are qualified to participate in the government’s Title IV Federal Financial Aid program.

What this means is that if you choose to attend an accredited massage therapy school, you can qualify to receive financial aid from the government. This is an enticing benefit because some, and in many cases most or all federal financial aid is “free” money. In other words, you don’t have to pay it back.

So how do you know which factors are most important to consider in your decision? How do you know what truly matters and that you are making the right decision? How do you maximize your chances of satisfaction, fulfillment and ensure that you go on to establish a successful career in massage therapy?

We will help you. We have compiled a comprehensive decision making check-list that you can download for free here.

FEDERAL FINANCIAL AID

Federal Financial Aid is the most common source of financial aid for any type of post high school education. It is also the easiest to obtain providing that you qualify for it. Most important of all, it is FREE to apply for. Many of its components awarded to you are also free, which means you do not have to repay it back. The following are the various components of the Title IV Federal Financial Aid:

  • Federal Pell Grant Program
  • Federal Supplemental Educational Opportunity Grant Program (FSEOG)
  • Direct Stafford Subsidized Loans
  • Direct Stafford Unsubsidized Loans
  • Direct Parent PLUS Loans
  • Federal Work-Study Program

Grants: This is free money from the Government that you don’t need to pay back.

Subsidized Loans: These are low interest loans awarded based on need. You don’t make payments while in school and 6 months after graduating (which is the grace period). You don’t have to go through a credit check either. These loans can range from $0 – $3,500 per academic year based on your eligibility.

Unsubsidized Loans: These are low interest loan (NOT awarded on the basis of need) on which interest accrues immediately but you don’t have to make payments until 6 months after graduation. Like subsidized loans, you don’t have to go through a credit check. Loans can range from $0 – $6,000 for independent student and $0 – $2,000 for dependent students per academic year based on your eligibility. Whether you are a dependent or not is based on whether your parents or anyone else claim you on their tax return.

Parent Plus Loans: These are low, fixed interest loans available to parents of undergraduate students to be used for tuition, books, fees, living expenses, etc. These loans require parents to go through a credit check, as well as co-sign for you, the student.

Work-Study Awards: This award gives you a favorable opportunity to work for the institution you attend at a wage above the “norm”. Institutions are subsidized by the Government when they hire students who have been awarded work-study. The Government often pays a portion of the wage as well, therefore it is more favorable for the employer (the institution) to hire work-study students over other applicants.

You can apply for Federal Financial Aid through the Free Application for Federal Student Aid (FAFSA) website here.

You read about the FAFSA form in a lot more detail, including how to fill it out here.

Do You Qualify for Federal Financial Aid

The following are the basic eligibility requirements you must meet to qualify to receive financial aid from the government:

  • Be a U.S. citizen or eligible non-citizen (defined on the FAFSA website)
  • Be registered with the Selective Service System (if applicable)
  • Not be in default on any previous student loan
  • Not owe a repayment on a Federal Pell Grant or Federal S.E.O.G. Grant
  • Not have borrowed in excess of the loan limits under Title IV Programs at any institution
  • Not have been convicted of a drug related crime in the past year

NOTE: Federal Financial Aid is a need based aid. Students must demonstrate financial need for Pell Grants and subsidized loans, but not unsubsidized loans. To calculate eligibility, the financial aid office in each school considers the cost of attendance (COA) at their institution as well as your Estimated Family Contribution (EFC), as determined by the information you provide on the FAFSA application.

How to Apply for Federal Financial Aid

If you qualify for federal financial aid, follow the steps below:

Step 1: Apply to the accredited massage school(s) of your choice

Step 2: Apply for a Federal Student Aid PIN number from the U.S. Department of Education’s website. If you have a federal PIN number but have forgotten it, you can ask to have it sent to you from the PIN web site.

Step 3: Complete the FREE Application for Federal Student Aid (FAFSA). You will be required to enter the school code number of the accredited massage schools you applied for or want to apply for (you can complete the FAFSA before you apply for admission). You can enter multiple school codes if you’ve applied to more than one. There is no need to complete more than one FAFSA application.

Step 4: Contact the school(s) where you applied and inquire the date when they expect to hear from FAFSA and when they would be able to provide you with information regarding how much federal financial aid you qualify for as well as which type(s) – for example: Pell Grants, Stafford Loans, etc. Many schools now have a virtual financial aid application process through which you can access all this information online with a login ID and password.

Information Needed to Apply for Federal Financial Aid

These are the various pieces of documentation and information you will need when completing the FAFSA:

  • Driver’s License Number (if you have one)
  • W-2 Forms and other records of income earned
  • Your (and your spouse’s, if you are married) Federal Income Tax Return form 1040, 1040A, or 1040EZ, foreign tax return, or tax return for Puerto Rico, Guam, Samoa, the U.S. Virgin Islands, the Marshall Islands, or the Federated States of Palau
  • Your parents’ Federal Income Tax Return (if you are a dependent student)
  • Your un-taxed income records: Social Security, Temporary Assistance to Families, welfare, or veteran’s benefits records
  • Your alien registration number or permanent residence card or U.S. Passport (if you are not a U.S. citizen)

Other Useful Links

Financial Aid Information Page
Information about all types of aid.

National Student Loan Data System (NSLDS)
This student access site is available for students to view their loan and grant records and obtain balance and loan holder information.

Student Budget Calculator
This site will help you to create a realistic budget while you attend school.

Pay as You Earn Calculator
This Federal Student Aid calculator will help you to determine if you are eligible for this program.

For more information on eligibility, please visit the Department of Education website.

You read about the FAFSA form in a lot more detail, including how to fill it out here.

SCHOLARSHIPS & PRIVATE GRANTS

We love scholarships and private grants because these are also free sources of funds which you don’t have to pay back. Some do involve a little more work, but they are definitely worth it because there is no limit to how many scholarships you get. Many times, scholarships alone are enough to get you through school entirely debt free.

Here are some of the common places where you can find scholarships:

  • Your school – Ask your school’s financial aid office about scholarships they offer, or whether they are aware of other scholarships that they can recommend you apply for.
  • Local libraries, churches, clubs like the rotary clubs, unions, foundations, banks, local employers, your parents’ employers and other local private organizations – The community wherein you live may have several organizations sponsoring all kinds of scholarships. Local libraries are usually a good way to find out about these so make sure you stop by and ask. Many local employers and rotary clubs are also well known for sponsoring various scholarship awards.
  • The internet – Scour the web for scholarship opportunities in your area and/or your field.
  • Massage industry groups and organizations – Research the various bodies of groups and organizations in the massage industry and scour their websites to determine whether they offer scholarships. Here are a few for example:

There are numerous sources out there. The key is to start early, put in some time researching and being a bit creative in your search. Thanks to the internet you can do most of this in your spare time at home or anywhere with an internet connection.

For example, here are details to the annual Massage Therapy Foundation Research grants.

NOTE: Do not pay for a scholarship searching service. Scams abound in this area so please beware.

TUITION PREPAYMENT / TUITION INSTALLMENT PLANS / TUITION FORGIVENESS

The next best thing to free money from federal aid and scholarships is the ability to pay your tuition in installments, or benefit from a significant discount if you were to pay your tuition in full upfront.

Ask your school of interest whether they have tuition flexibility plans they offer their students. There are three common ones to look for:

Tuition Prepayment

Many schools will offer a discount when you pay all of the tuition upfront in a lump sum payment. If you can afford to do this, you may end up with a pretty nice discount similar to when purchasing a vehicle for cash. Even if you cannot afford to do is, if you have a line of credit or loan available at a low interest rate elsewhere, you may want to run the numbers to determine whether the discount provided by the school amounts to more than what you’d pay in loan interest. In any case, tuition prepayment discounts are not unusual in massage schools.

Tuition Installment

Many schools will also allow you to pay your tuition in installments, for example – each month. This is also called a “pay as you go” plan. If your school of interest doesn’t offer this, ask them if they would consider you paying tuition in installments. When evaluating tuition installment plans, determine whether you are being charged an interest by the massage school in the form of a higher tuition. For example, a $6,000 tuition paid over 12 months amounts to $500 per month. However, if the school charges you a monthly installment rate of $525, then this becomes similar to a situation wherein you are borrowing money from a lender to pay tuition.

Tuition Forgiveness/Reimbursement

Finally, if your school of interest runs a massage business, or is associated or affiliated with one, ask whether they would be willing to forego your tuition or forgive your student loans (if granted by them) in exchange for your service upon graduation. This is not too uncommon. A similar comparison to this In the business world would be a company paying for an Associate’s MBA program in exchange for at least 4 years of the Associate’s services post MBA completion. If you already work for an employer, find out whether your employer has a tuition reimbursement program that you can participate in.

VARIOUS IRS TAX CREDITS AND DEDUCTIONS

The Internal Revenue Service (IRS) allows certain tax benefits in the form of tax deductions and tax credits resulting from expenses incurred as part of higher education. These are some of the largest and most common:

American Opportunity Tax Credit (up to $2,500)

This tax credit is available through December 2017 as per the American Taxpayer Relief Act of 2012 (this can potentially be extended). Under the American Recovery and Reinvestment Act (ARRA), more parents and students will qualify for the American Opportunity Tax Credit to help pay for college expenses.

The American Opportunity Tax Credit (AOTC) modifies the existing Hope Credit of up to $1,650 per student. The AOTC makes the Hope Credit available to a broader range of taxpayers, including many with higher incomes and those who owe no tax. It also adds required course materials to the list of qualifying expenses and allows the credit to be claimed for four post-secondary education years instead of two. Many of those eligible will qualify for the maximum annual credit of $2,500 per student.

The full credit is available to individuals whose modified adjusted gross income is $80,000 or less, or $160,000 or less for married couples filing a joint return. The credit is phased out for taxpayers with incomes above these levels. These income limits are higher than what they were under the existing Hope Credit.

You can find more information about the American Opportunity Tax Credit here.

Lifetime Learning Tax Credit (up to $10,000)

This tax credit is similar to the AOTC in terms of what expenses qualify. The credit allowed is up to 20% of a family’s tuition expenses, up to $10,000.

For more information on tax credits, go to www.irs.gov or ask your school’s Financial Aid Representative.

PRIVATE LOANS

Another way to fund your education is through private student loans. The two main components to consider when taking out a private loan are the interest rate and the terms of repayment.

In-House Loan Programs Through Massage Schools

When speaking to financial aid representatives at massage schools, ask whether they offer an in house loan program for their students. These programs typically allow students to pay tuition on a weekly, monthly or quarterly basis which they can earn through a part time job while attending school. Ideally, you’d like to see this program as an interest free program the school offers to help potential students.

Smart Loans

Smart Loans are private loans offered by private lenders which are eligible to be used to cover tuition, books, fees, etc. These loans charge an interest rate that is based on credit history. You will likely be required to bring in a co-signer such as a parent.

Personal Loans – Banks & Credit Unions

Many banks and credit unions now also offer personal loans for education. These loans also charge an interest rate and thus we recommend that you check with your bank and shop around for the best interest rate available. Local credit unions generally prove to be a good option for education loans, both in the rates that they offer and in their customer service. Don’t forget to visit your local credit union and inquire about student loans. You can use this link to easily shop around for the best private loan available to you.

NOTE: Private lenders are in the lending business primarily to make money. It is critical that you research the best possible private loan available at the time you are interested in applying for one. There are thousands of lenders across the country that offer these loans and it is difficult to individually research each lender. To simplify and expedite the process, use this private student loan link to easily sort and search for the best lender for you.

VOCAL REHABILITATION

Many States now have programs they call Vocal Rehabilitation programs which cover tuition, books and fees in full. These programs are administered by the Department of Health and Human Services. To qualify for these programs, you generally have to meet the following criteria:

  • You have a physical, mental, learning disability, or emotional impairment that affects your ability to find or maintain employment, and
  • You require Vocal Rehabilitation services to get ready for, find or keep a job.

The first step is to find out whether your State offers such a program. If it does, schedule an appointment with a rehabilitation counselor who will help you explore your options throughout the rehabilitation process.

VETERANS BENEFITS AND MILITARY GI BILL

Another resource of education funding is the US Department of Veterans Affairs. To qualify, you must be a veteran or a military spouse.

Many massage therapy schools are approved by their State Approving Agency for the enrollment of persons eligible for education assistance benefits from the US Department of Veterans Affairs.

As way of background, In 1944, President Franklin Roosevelt signed the Servicemen’s Readjustment Act, otherwise known as the GI Bill. After World War II, more than two million veterans attended college on the GI Bill, according to estimates.

The current program, now known as the Montgomery GI Bill (MGIB), is the centerpiece of military education benefits. The bottom line for the GI Bill is a generous one: Active duty service members and veterans can receive a monthly benefit that is valued at nearly $40,000. This tax-free benefit can be used for tuition, books, fees, and living expenses while earning a degree or certification (including undergraduate and graduate degrees), or attending trade school.

You can learn more about this form of educational assistance here.

In addition, here is a list we have put together summarizing the massage school loans and grants available for veterans / US military members.

AMERICORPS EDUCATION AWARDS

Some massage therapy schools are also approved to accept America Awards.

Each AmeriCorps member who successfully completes a term of AmeriCorps service will receive a Segal AmeriCorps Education Award. You can use your Segal AmeriCorps Education Award to pay educational expenses at qualified institutions of higher education, for educational training, or to repay qualified student loans. You have up to seven years after your term of service has ended to claim the award.

If you successfully complete a term of service in AmeriCorps VISTA, you are eligible to receive either a Segal AmeriCorps Education Award or an end-of-service stipend.

OTHER GOVERNMENT FUNDING PROGRAMS

In addition to the Federal Financial Aid program, students may be eligible to receive funding for their Massage Therapy study at certain institutions from various other state and/or local (county) government funding programs, particularly if they have been profiled under the State Unemployment Insurance Program.

Eligibility for this type of aid is determined on an individual’s specific needs and demographic characteristics. Students seeking government sponsored financial aid must work closely with the agency which is providing the funding to see that the school of their choice receives all tuition payments by the specified deadlines.

  • State Adult Career and Continuing Education Services
  • State Unemployment Training Programs – Check to see whether the school of your choice is an approved education program for those looking to start a new career as a Massage Therapist in your State. Please contact your unemployment office for more information on this alternative.
  • Workforce Investment Act – Grant funding may be available to help displaced workers in need of job training to re-enter the workforce. Contact your local One-Stop Career Center or visit www.capreg.org.
  • TAA/Trade Adjustment Assistance- Help for trade-affected workers who have lost their jobs as a result of increased imports or shifts in production out of the United States. Visit www.doleta.gov/tradeact/benefits.cfm for more information.

529 PLANS / PREPAID TUITION PROGRAMS

State Prepaid Tuition Plans

Many States have what is called a Prepaid Tuition Plan (also called College Investment Plans) where you can lock in tomorrow’s tuition at today’s prices. Many parents and grandparents are invested in such plans in anticipation of their children attending school in the future.

If you are a qualified beneficiary of this plan, ask your school whether they are qualified to be recipients of State Prepaid Tuition Plans. If they are, you can start the process for transferring your Prepaid College Plan benefits to your institution is as follows:

  • You will have to file a completed Transfer Form with the State Prepaid College Program (The form may be obtained from the State’s Prepaid College Plan’s website).
  • Once the Prepaid College Board has confirmed that the school is eligible under Title IV, the Board will send a letter to the account owner confirming that the transfer of Prepaid College Plan benefits has been approved.
  • Upon approval of the transfer of benefits to the institution by the Prepaid College Board, the Board will send a letter to the institution outlining the procedure that the institution must follow for invoicing the Prepaid College Program for the tuition and fees for that particular student and the Prepaid College Plan benefits available to the student under his or her Prepaid College Plan contract.

529 Education Saving Plans

A similar vehicle to the State Prepaid Tuition Plan is the 529 Education Savings Plans. These are tax advantaged savings programs for college education where parents and grandparents can invest their money tax free to fund their children’s education in the future.

If you are a beneficiary of this plan, ask your school whether they are an approved institution for those who would like to use their 529 college savings plan to pay for their Massage Therapy education. If it is, contact your 529 Plan administrator and go from there.

CREDIT CARDS

Many prospective students consider credit cards as alternative financing sources when it comes to vocational education. While we don’t recommend this approach, we have seen many students successfully finance (and repay) their education through credit cards. If you are going to consider this route, we highly recommend researching and assessing the repercussions and the potential downside consequences in the event things do not go as planned.

PART TIME EMPLOYMENT

Many massage students have part time jobs outside of school, which is how they fund their education. Fortunately, massage school classes offer the flexibility that allows you to maintain a career or a part time job while attending school at the same time.

ADDITIONAL TIPS

Most institutions have a financial aid department or a financial aid representative in the case of smaller schools. Always work with these individuals when possible. If these resources are not available to you for whatever reason, reach out to your local library and city council office and ask if there are local counselors in your city that you can speak to regarding your educational and career goals.

Individuals that work in this field are generally like social workers in that your best interest is their interest as well. Make sure you have them explain all the various plans and options that are available to you and which of those would work best for your situation. Don’t be afraid to ask as many questions you need to thoroughly understand the various financial aid options out there.

Read our 5 solid and proven tips to maximize your financial aid for massage school here.

OTHER HELPFUL FINANCIAL AID ARTICLES

How to Understand & Evaluate Massage School Tuition, Fees & Financial Aid Options

Alternatives to Dropping Out of Massage Therapy School Due to Financial Hardship

Tips on Repaying Your Federal and Private Massage School Loans

 

Source: Massage Therapy Student Information

 

massage school financial aid ebook




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