Helping Families Compare Awards
Doing the math and knowing the options
Soon after getting acceptance letters from colleges, students will receive details of their financial aid offers. Most aid packages consist of some combination of scholarship, grant, educational loan, and student employment-and the distribution of aid among these elements will vary for each college. Evaluating and comparing offers can be tricky—and families may not be aware that they can appeal an award. How do you help students and families compare and appeal financial aid awards?
Types of financial aid
First, make sure your students and their families understand the three main categories of financial aid.
Scholarships and grants
Often referred to as "gift" aid, scholarships and grants are freely given and don't have to be repaid. However, the gift may come with conditions. For example, the student may have to maintain a minimum grade point average to renew a scholarship. Or, in the case of a grant based on financial need, the grant amount may be adjusted if the student gets aid from other sources.
Loans
Financial aid in the form of student loans will have to be repaid at some point.
Need-based student loans are subsidized, meaning they do not have to be repaid until the student graduates. Some important considerations for families looking into these loans include:
- Repayment terms
- The interest rate
- Whether yearly interest will be paid by the government while the student is enrolled
- How much the loan will increase after the student's first year
- When repayment begins
- Total indebtedness by graduation
- What the monthly payment will be after graduation
Supplemental, or unsubsidized, loans are also available for tuition. These are not based on need, and families must make yearly interest payments on these loans. (It's best for students to leave these supplemental loans out of the picture when considering and evaluating their aid awards.)
Work-study
Some students may be offered work opportunities, known as "work-study" programs, to help defray their educational costs. The financial aid office will usually help the student find a position that fits her course load and needs. Questions for students to bear in mind are:
- Is a job guaranteed or will the student be responsible for finding one?
- How many hours per week at what wage will the student need to work?
- How are jobs assigned?
Using our online tool
Students and their families can compare as many as four financial aid packages with the College Board's online Compare Your Aid Awards tool.
All they have to do is enter information about the college costs and aid offers.
Getting answers
If families have specific questions about any aspect of a particular aid package, recommend that they call the school's financial aid office. They'll need patience as well as persistence as aid offices are extremely busy in the weeks and months after admission letters are sent. If necessary, families should schedule a visit in person to discuss follow-up questions.
Remembering priorities
The school with the most attractive financial aid offer might not be the best choice for a student. Educational and career goals should be foremost in mind, along with location and other quality of life concerns. College represents a major personal investment—not only of dollars but precious time, work, and energy.
Financial aid appeals
Even with a financial aid package from a college in hand, some families may find themselves coming up short. One option is to file a financial aid appeal.
Encourage the parents and the student to stay positive. After all, once a college has admitted a student, they are genuinely interested in having her attend. And an upbeat, thoughtful, and well-advised appeal demonstrates a greater interest on the student's part to work out a financial solution. That said, below are a few important guidelines to successful aid appeals.
Timeliness: The longer the student waits, the less money will be available overall, so aid appeals should be made as soon as possible. Most schools require a nonrefundable deposit to hold a place in their incoming class, so students may have to consider whether they can afford that up front.
Attitude: Families shouldn't view an aid appeal as a "negotiation." Financial aid staff are generally hard-working, dedicated advocates for their students. Sincerity and candor are the best approach.
Explanation and documentation: If the family feels that it can't afford the EFC (expected family contribution) calculated by the school, they may request a meeting in writing in order to explain why the school should take the time to reconsider their numbers. Simple consumer debt won't be considered, but if there's been a significant change in financial status—due to layoff, divorce, death in the family, or medical expense, for example—this should be reported, and can be easily documented through tax records or other legal papers. Advise families to keep careful financial records throughout the entire financial aid process.
Receipt of another offer: In some cases where a student has received a more attractive offer from another school, the family may wish to appeal and see if the college can improve on their initial award. This outcome is by no means certain, as aid offices will have worked hard to fairly determine their offers. It is important that this appeal be presented as a respectful request and not a negotiation tactic.
The candidate's strength: Some schools won't want to turn someone away for financial reasons, while others simply can't afford to increase their awards. Every school administers aid in its own fashion, so there's no harm in politely asking about how an award was determined.
Don't give up
An aid appeal should only be pursued if the student and family can present a serious case, especially if new information is presented for consideration. Should the appeal prove unsuccessful, applicants should remain gracious—and not give up. The financial aid office may be able to help out in other ways, for example advising on outside loans with favorable rates, if the family goes that route. There's more than one way to tackle the financial challenges college presents. Show students some options, and that degree won't seem so far out of reach.