One of the biggest problems I hear about when families start the college planning process is…(drumroll, please)
- Will our family qualify for financial aid?
- Will we actually be able to afford college!?
- Are private schools always more expensive than public schools?
- How come my cousin’s kid got a “free-ride” but our neighbor’s son is paying full price?!
- Do public and private colleges award financial aid in different ways?
College is expensive and most of us want to find ways to make it more affordable.
If you want to make college more affordable the first thing to know is…
…Colleges give MUCH more free money to students than anyone else, including the federal government.
With few exceptions, expect the biggest scholarship to come from the college you attend – NOT a scholarship from a community organization or company.
The free money colleges give are called by many names, but “tuition discount” is what colleges call them as they plan for them.
Tuition discounts come in two main forms:
- Need-Based – given when a family has “demonstrated financial need”. That need is demonstrated via required forms/ formula(s) – the FAFSA (and at some schools, a second form called the Profile).
- Merit-Based – Merit aid is NOT based on financial need… even a multi-millionaire’s kid could get merit based aid. Merit aid is based primarily on academic merit (grades and test scores).
YOU NEED TO KNOW WHAT TYPE OF AID TO TARGET
The type of aid you might get depends on whether you have been shown, (via the FAFSA form/formula and, in some cases the Profile form/formula) to actually have financial need.
You may think you have financial need but if the FAFSA doesn’t show it, no college in the country is going to say you have financial need.
HOW IT WORKS
The FAFSA is a form you complete that gathers info on your family’s unique financial aid situation.
The form is tied to a formula that calculates a dollar amount.
The dollar amount calculated is called your Expected Family Contribution – or EFC.
That dollar amount, your EFC, represents what all colleges in the country believe you can pay, at a minimum, for one year of college.
NOT the maximum you will have to pay… the minimum you will have to pay.
An Expected Family Contribution (EFC) can be anywhere from $0 to well over $100,000, depending on the family’s financial situation.
In general, the lower your EFC number, the more financial need your family is eligible for (at both private and public schools).
A $0 EFC means that, per the formula, you are not expected to be able to pay anything for college (but does NOT guarantee that you will get any aid at all…. keep reading).
Getting an estimate of your EFC, is THE STARTING POINT for determining if you should try to find schools that will give you a…
- Need based tuition discount OR
- Merit -based tuition discount OR
- Some of both.
Once you know about what your EFC is you want to try to find schools that will give you the TYPE of aid you need; THEN you create the list of colleges you want to apply to.
IF YOU WANT TO MAKE COLLEGE MORE AFFORDABLE, YOU NEED TO BE STRATEGIC AS YOU CREATE THE LIST OF COLLEGES TO APPLY TO
- Some colleges do a great job with need-based tuition discounts (but only IF the FAFSA and the Profile forms show that you have financial need)…
- Some colleges do a great job with merit-based tuition discounts...
- Some colleges give NO merit-based tuition discounts...
- Some do a great job with both.
What this looks like in the real world is that…
PRETTY MUCH EVERYONE AT THE SAME SCHOOL IS PAYING A DIFFERENT PRICE.
Your goal is to find the most generous schools that will consider your student an attractive candidate.
That’s because colleges award more money to students who bring something they want, (grades/test scores/diversity, including geographic diversity /leadership…), and this varies from college to college .
Having a very low, or even a 0 EFC does NOT mean that a college, any college, will pay the full amount for you, or even give you any money toward tuition.
That, again, depends on the school’s policies for giving aid AND your student’s academic profile in relation to THAT school.
Which makes building a smart college list extremely important to making college more affordable for you.
You can get an estimate of what you will be expected to pay for one year of college – your Expected Family Contribution (so you can target what TYPE of tuition discount to target) here . It’s free and no personally identifying information is needed.
Before you head off to calculate your number, I want to leave you with two more thoughts:
- Don’t despair if your EFC seems way larger than you can afford — remember that even a multi-millionaire’s kid can get a merit-based tuition discount at many schools, which can help reduce tuition by thousands, even tens of thousands, of dollars per year.
- Also, students don’t need to be a straight A students or star athletes, etc, to get tuition discounts. What’s most important is that your student’s academic profile is a good fit for THAT SPECIFIC school (all of this is covered in my mini-course, which is linked below).
Keep an open mind because the best scholarships often come from a school you and your student have never considered!