The good news about the eye-watering tuition prices you see on college websites is that fewer than half of families pay the full sticker price.
There are two types of financial aid: merit-based and need-based. Merit-based aid is given by the school and is based on a student’s performance in high school. Colleges will offer merit aid to the highly qualified students they want to enroll. Need-based aid is given by schools based only on demonstrated financial need, not on merit. Generally, the more selective the school is, the more likely it is to offer only need-based aid. Some schools give a mix of merit and need-based aid.
Most schools will use information submitted by the student via the Free Application for Federal Student Aid (FAFSA); a few use the College Scholarship Services (CSS) profile. Both will require the submission of tax returns and a great deal of other information. The FAFSA will produce an estimated family contribution (EFC), the amount a family can be expected to pay for college costs, according to the government’s algorithm. However, this number is not a guarantee of aid. It is simply a data point used by colleges when calculating a financial aid package. Each college will have a Net Price Calculator (NPC) on their website that provides the most accurate information on a family’s expected contribution. Unfortunately, there is no standard NPC: each college has its own. If families need to take loans to cover a gap between the financial aid offered by the school and what they can actually afford to pay, they should think very carefully about how much debt they want to take on, and what type of loan would be best. Financial aid award packages can be appealed if families do not think they are accurate.
The college your student attends will be the largest source of aid. There are other sources, including thousands of private scholarships, but they are typically small, difficult to find, and time-consuming to complete. Some students may decide that the time it would take to find and apply for private scholarships is not worth the relatively small amount of money they might receive if they win. Scholarships from a state for its public colleges can be substantial, so if financial aid is a major concern, be sure to look into state schools.
Most state colleges also offer lower prices for residents, and many have regional reciprocity programs for residents of nearby states.
Adapted from an article by A Starting Line coach Karen Droisen.