Saving and paying for college in California

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Mark Kantrowitz

By Mark Kantrowitz

September 24, 2018

California offers several college savings, grant and scholarship programs to help California residents pay for college in California.

California college savings programs

California’s ScholarShare 529 Plan is a 529 college savings plan that provides tax and financial aid advantages for investors who are saving for a child’s K-12 tuition and qualified college expenses. The ScholarShare 529 plan has received’s top 5-Cap rating because it offers among the best performance and lowest costs of direct-sold 529 plans.

There are, however, no state income tax deductions for contributions to the ScholarShare 529 plan and a 2.5% state income tax penalty for non-qualified distributions.

Minimum contributions are $25 per investment portfolio ($15 per paycheck for payroll deduction). The maximum contribution limit is $475,000.

Investment options include two age-based asset allocations, one based on actively-managed funds and one based on passive index funds. There are also 12 multi-fund portfolios and four individual-fund portfolios, one of which is the Social Choice portfolio. There is also a no-fee principal-protection portfolio.

Cal Grants

Cal Grants are one of the most generous need-based state college grant programs.

The Cal Grant covers full system-wide tuition and fees at University of California and California State University campuses. It also provides up to about $9,000 at California private colleges and up to about $8,000 at California career/technical colleges. The Cal Grant is renewable for up to four years.

There are three types of Cal Grants: A, B and C.

  • Cal Grant A recipients must demonstrate financial need and have income and assets below state ceilings based on the median California income. Recipients who are recent high school graduates must also have a 3.0 GPA on a 4.0 scale. Transfer students must have a 2.4 GPA.
  • Cal Grant B recipients must satisfy similar criteria as for the Cal Grant A recipients, but are limited to very low income students and require at least a 2.0 GPA for recent high school graduates (2.4 for transfer students). The Cal Grant B also provides recipients with a stipend for living expenses.
  • Cal Grant C is intended for occupational or vocational programs.

To apply for the Cal Grant, students who are U.S. citizens or permanent residents must submit the Free Application for Federal Student Aid (FAFSA) by March 2.

AB540 students should submit the California Dream Act Application (CADAA) instead of the FAFSA. AB540 students include, in addition to DACA students, students who completed three years at a California K-12 school and have three years of high school credit, students who completed three years of high school, community college or adult school in California, students who obtained a GED or passed the California High School Proficiency Exam.

All applicants for the Cal Grant should make sure their high school files the Cal Grant GPA Verification Form.

Free help completing the FAFSA and California Dream Act Application is available through the California Cash for College workshops.

Other California state grants

California offers several other state grant programs:

  • California Middle Class Scholarships are available for low and middle-income students who will attend a University of California (UC) or Cal State University (CSU) campus. A minimum 2.0 GPA is required. The maximum award varies each year, but generally is around $5,000 and is intended to cover between 10% and 40% of the system-wide tuition and fees. Consideration is automatic for students admitted to a UC or CSU campus who file the FAFSA or the California Dream Act Application.
  • The California Chafee Grant for Foster Youth provides up to $5,000 per year for college or vocational training for current and former foster youth who are under age 26.
  • The California National Guard Education Assistance Award Program (CNG EAAP) is available for active members of the California National Guard, California State Military Reserve or California Naval Militia.
  • The Law Enforcement Personnel Dependents Grant Program (LEPD) provides grants to spouses and dependents of California first responders who died or became totally disabled in the performance of their duties. First responders include police, sheriffs, marshals, highway patrol, full-time firefighters, Department of Corrections staff and California Youth Authority employees.
  • The California College Promise Grant, previously known as the BOG Fee Waiver, waives enrollment fees at California Community Colleges for students who are eligible for need-based financial aid, students who receive CalWORKs (TANF), SSI or General Assistance payments, and students whose family income falls below certain ceilings.

Other sources of funding for California students

The FAFSA provides access to the Federal Pell Grant, Federal Supplemental Educational Opportunity Grant (FSEOG), Federal Work-Study and federal student loans.

Taxpayers who qualify may obtain the American Opportunity Tax Credit (AOTC) or Lifetime Learning Tax Credit (LLTC) by filing a federal income tax return. These are partially refundable and non-refundable tax credits based on amounts paid for tuition and textbooks.

California students should also search for scholarships using a free scholarship search site. Not only will these sites help California students find California-specific scholarships, but they will also match them against non-state-specific scholarships.

Scholarships for undocumented students may also be found through MALDEF and Immigrants Rising.

A good place to start:

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