One big consideration in choosing a college, at least for most people, is how brutal a blow the bills will deal to the family finances. By following a smart strategy in applying for financial aid, you may encounter some pleasant surprises – like an offer from that pricey private college at the top of your wish list so generous that the school ends up being more of a bargain than the local state university.
Your first move in tapping Uncle Sam’s rich resources is to fill out the Free Application for Federal Student Aid – better known as the FAFSA – as early as possible. The deadline for the 2019-2020 school year is June 30, but you can file the form as early as Oct. 1 of senior year. Colleges use the form to allocate their own money, too, and each school you’re applying to could have a different deadline, so it’s important to make sure you’re on top of the key dates.
The FAFSA crunches your family financial data and arrives at an amount it determines you can afford to pay. But multiple factors will come into play as schools assemble their aid packages and offer letters.
First, it’s helpful to know whether they are “need aware” or “need blind.” Admissions officers at need-blind colleges don’t have access to applicants’ financial data, meaning they’re making admission decisions based entirely on a student’s academic and other credentials. Schools that are need aware, on the other hand, may consider a family’s need for financial assistance in weighing candidates.
“Among the many things our admissions office takes into consideration when they’re determining the admissibility of a student is how much that student would cost us,” says Sean Martin, director of financial aid services at Connecticut College.
Part of the reason is that the school also commits to meeting every student’s full demonstrated need, meaning the gap between how much the FAFSA form says is your expected family contribution and the total cost of attending.
Not all schools do so. Many resort to “gapping,” meaning they offer a package that falls short of the full need of some applicants, perhaps those who are not in their top tier. Other colleges sometimes “admit-deny,” which means they’re glad to accept a qualified applicant but don’t come close to offering sufficient money.
Still, students who need financial aid shouldn’t assume that will work against them, Martin says. “They may bring other things to the table that outweigh cost,” such as geographic diversity, academic strength in a particular subject or a strong interest in music or political action, say. A good tactic is to apply to at least some colleges where you beat the average performance of previously admitted students on typical measures like GPA and standardized-test scores.
After students are admitted, universities get to work packaging together what is typically a mix of federal grants and loans and scholarships from the school itself based not on need but on academic merit or special talents. Some students will also receive work-study jobs as part of their federal package.
A growing number of schools are moving toward no-loan packages, meaning they offer private grants in lieu of federal loans. Some 50 schools follow this practice for low-income families, and 16 have extended it to all families, including Brown University, Princeton University and Vanderbilt University in Nashville.
Many colleges will expect you to file a supplemental form known as the CSS Profile. The form, which you fill out at the College Board website, goes into far more detail than the FAFSA form does, collecting data about the amount of equity your family has in your home, for example, and how much income comes in from a family-held business. If the student’s parents are divorced or separated, financial information about both may be needed – and new spouses, if applicable.
Compare apples to apples. Once you have offers in hand, scour them carefully. Though the bottom lines may be equivalent, one package may be more heavily tilted toward loans than another; colleges often are more generous in giving outright grants to students they really want.
Cindy Deffenbaugh, assistant vice president and director of financial aid at the University of Richmond in Virginia, recalls a conversation with parents who whipped out an offer letter from a college they thought was being much more generous than Richmond was. “The dollar value looked higher than our offer,” Deffenbaugh says. But the competing offer included a Parent PLUS loan, an optional loan offered by the federal government.
She explained that Richmond provides information about Parent PLUS loans but doesn’t count the potential value in the package. To “compare apples to apples, take the cost of each school and subtract the grants and scholarships,” Deffenbaugh says. “What’s left is the amount you’ll pay out of pocket,” which may or may not include loans.
It’s also important to consider how your burden will change in subsequent years. Some scholarships and grants will automatically renew, while others may be one-time awards or require that the student maintain a certain GPA. If those details are not in the offer letter, be sure to ask the financial aid office to clarify.
Factor in tuition. You’ll also want to be prepared for any changes in tuition in years two, three and four.
“Some schools will tell you the tuition will stay flat for all four years, but they may still increase their fees” for using scientific labs or counseling centers, say, notes Robert Durkle, associate vice president and dean of admission and financial aid at the University of Dayton in Ohio.
Dayton is one of several colleges with a so-called fixed-price tuition plan promising accepted students that their net tuition will stay flat for four years. Scholarships and grants will increase to offset any rise in tuition. The school doesn’t charge fees, he adds, and it offers up to $500 per semester toward textbooks to families who file the FAFSA.
Student borrowing at Dayton for the class of 2017, whose tuition was $41,750, dropped 22 percent compared with 2013, when the fixed-price policy was adopted. The average total debt is $18,000, significantly lower than the $30,000 national average. Other colleges with fixed-price plans include Ohio University and George Washington University in the District of Columbia.
Another good way to reduce your loan burden is to apply for private scholarships. The amounts may seem small, and many are one-time awards, which may cause your school to adjust your package downward accordingly. But most colleges use outside scholarships to offset what they would otherwise offer in loans or work-study funding.
“Start early, in your junior or sophomore year,” advises Shivraj “Sunny” Sandhu, a junior at Princeton who stacked up $600,000 in scholarships and needed no financial aid. He started by downloading Scholly, a smartphone app that matches students with scholarships based on their GPAs, hometowns and unique demographic characteristics. “The app streamlined all the scholarships that were applicable to me and gave me the due dates,” Sandhu says.
He applied to more than 25 and pulled in money from organizations like the Bill & Melinda Gates Foundation, Coca-Cola and Burger King. After he applied for a small scholarship from his local Elks Club in Wilson, North Carolina, he was entered into a national competition that netted him $40,000. He also nabbed $25,000 from Foot Locker, which he qualified for by playing on his high school’s soccer and tennis teams. “It takes a lot of research time, but it’s worth it,” Sandhu says.
Understand the art of the deal. If an offer arrives that’s far better than the one your dream college has made, is it OK to negotiate? In the right circumstances, most schools will likely be open to an appeal – for example, if your financial situation has changed since you submitted the FAFSA.
A divorce, unexpected medical bills, natural disasters – such circumstances can resonate with financial aid officers, says Brooke Fincke, the director of college counseling at Chapel Hill-Chauncy Hall, a private high school in Waltham, Massachusetts. Fincke recommends creating a spreadsheet of all your monthly expenditures, not counting college costs, and being prepared to include it as part of your appeal.
Otherwise, experts don’t advise pitting one school against another unless you’re certain your chosen college will consider appeals from students whose financial situation hasn’t changed. Students who bring sought-after skills to the table can come out of negotiations with a better package, but they’ll have to reveal what the competing school is and how much it is offering. Specialty colleges might also be open to negotiations.
“If a competitor is offering more money, we ask them to send us that award letter,” says Kathleen Gailor, director of student financial planning at the Culinary Institute of America. “We ask them to write a short essay about what they did to prepare to come to school here and what’s going to make them successful in the food world.”
If you do appeal, make your case with facts and be as personable as possible with financial aid officers, suggests Charlie Javice, founder and CEO of Frank, an online tool designed to help college students with the financial aid process. “Share your story in a compelling but succinct way,” she suggests.
That strategy worked for Javice, who successfully negotiated for an increase in her aid package in all of her three years at the University of Pennsylvania. “There was a lot of back-and-forth with the financial aid office,” recalls Javice, who graduated in 2013. “But schools will work with you.” They’re reluctant, she says, to lose out on good students once they’ve made the offer.
