Most people believe they need financial assistance to pay for college. Because there is so much need and funds are limited, the federal government has set policies to measure need. Most financial aid is based on need. “Need-based” means that your family’s financial resources, as measured by a formula established by the federal government, are not sufficient to cover your educational costs. The federal government’s definition of financial need compares your income and savings to the cost of the college you plan to attend. Therefore, if you choose to attend a local community college, your financial need may be small, while if you choose to attend a higher priced college, your financial need may be large.