I have just been told I will lose my job effective March 31 because my company is closing this facility. My 21-year-old daughter is planning to attend graduate school next year and I am in the process of completing her FAFSA application. In trying to maximize her eligibility for financial aid, is it better for me to include the parental information or not?
-- Name withheld

When it comes to graduate school, your daughter stands on her own financial feet with regard to the Free Application for Federal Student Aid (FAFSA). Students working on a master's or doctorate degree are considered "independents" in the eyes of FAFSA, so parental information isn't considered. Still, your daughter will likely qualify for federal financial aid just fine on her own.

Two major types of federal loans are offered for grad students: Stafford loans and Graduate PLUS loans. With Stafford loans, up to $20,500 per year ($138,500 over a student's lifetime) can generally be borrowed. For the 2012-2013 school year, these loans carry a fixed rate of 6.8%, plus a one-time fee of 1% of the loan amount. Grad PLUS loans carry a 7.9% interest rate plus a 4% fee. The maximum a student can borrow is the cost of attendance, minus other aid received.

As long as your daughter hasn't defaulted on undergraduate student loans, she should qualify for a Stafford loan, says Mark Kantrowitz, publisher of the education-funding web site Fastweb.com. Grad PLUS loans consider a student's credit history, but barring a significant problem (like a current 90-day delinquency), she's unlikely to be denied.

Funding may also be available elsewhere. The school itself may provide aid, and in some cases (such as with some law schools), parental information is considered. If so, contact the school to explain your situation. Outside fellowships may also be available from companies, local governments or private foundations. You can search on sites like Fastweb.com for options. In some cases, a current employer may pick up part of the tab.

Just keep in mind, piling on heaps of graduate school debt should be thoughtfully weighed. Kantrowitz recommends that for most degrees, a student's total debts (including undergrad loans) should be less than her anticipated starting salary.

-- Stephanie AuWerter

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