Starting college means learning to manage new financial responsibilities that may be completely new to you. One of the most exciting yet confusing topics for students is financial aid refund checks. If you’ve heard of students getting “extra money” from financial aid after tuition is paid, they are talking about refund checks! We’ll walk you through what refund checks are, how they work, and how to make the most of yours if you receive one. 

What is a refund check?

A refund check is money that your school gives back to you if there is a surplus after your financial aid has been applied to your account. This can happen when the total amount of your grants, loans, or scholarships exceeds the cost of tuition, fees, and on-campus housing (if applicable). If there is money left after your financial aid has been applied to your student billing account, then that amount is known as a credit balance. Colleges are required to refund you any credit balances on your student billing account via direct deposit, check, or credit towards future tuition and fees with your permission within 14 days. 

How do I know if I’m getting a refund check?

Students will know if they are receiving a financial aid refund check after all of their tuition and fees have been covered for the term and there are remaining funds. Here is the general cycle of financial aid that may lead to a student receiving a refund check from their college: 

1. Complete or renew your FAFSA – Complete or renew your FAFSA application. 
2. Check your status – Log in to studentaid.gov and click “My Activity”. If any corrections are needed, be sure to take action.
3. Wait for your offer – Your college(s) will craft a financial aid offer letter based on your FAFSA. Call your school’s financial aid office if you have concerns.
4. Review your offer(s) – Review financial aid offer letter(s) with your family or a trusted educator.
5. Accept aid - Follow the steps outlined in your offer letter to accept the grants, scholarships, loans, and/or work-study you want for the upcoming school year.
6. Disbursal of aid – Your school’s financial aid office will apply your aid directly to your student account.
7. Pay off remaining balance – If there’s any unpaid tuition and fees remaining, you'll be responsible for covering it.

OR 

8. Receive a refund – If there is money left after covering tuition and fees, you’ll get a refund to use for other college expenses, like books, supplies, and transportation. If this comes from a loan, you can reduce the amount you accept. 

When are refund checks disbursed?

It varies by college, but it’s usually right before the start of the term after the add/drop deadline. Most colleges will post the refund disbursal schedule directly on their billing or financial aid website. 

What can I use my refund check for?

It’s best to use a financial aid refund on education-related expenses. This can include rent, books, supplies, transportation costs, and food. It may be tempting to use the money on personal, non-school related expenses, but it’s important to use these funds wisely. While checks may feel like "free money," it’s important to understand that if the funds come from a loan, you will have to pay them back with interest, so be sure to only accept what you need. 

What are things to keep in mind about refund checks?

While it’s exciting to be receiving money, it’s important to consider the implications. 

• Budget your money: Make a budget to get the most out of your refund check! It’s easy to spend quickly, but keep in mind that refunds usually only come at the start of the term. If you don’t have a job, you’ll want to stretch that money to last the whole term. 
• Only take out loans that are necessary: Refunds are often the result of taking out more money in student loans than you actually may need. If your refund feels like too much, you can return the extra money to your student loan provider. It may feel like free money now, but it’s money you’ll eventually need to pay back later. Contact your school’s financial aid office for details about returning funds. 

Financial aid refund checks should be used to support your experience as a student while teaching you to effectively manage your money! If you have any questions or concerns, visit your school’s financial aid office to learn more.