This article is published in the 2017 I’m First Guide to College
By Bob Giannino-Racine
Congratulations, you’ve been accepted to college! Now comes the hard part of figuring out how much college is going to cost and how to pay for it. Following are some tips to help you understand your financial aid package and make the decision about how to pay.
Understanding Award Letters. When analyzing your award letters, consider two key categories of information—Gift Aid vs. Self-Help Aid the Full Cost of Attendance. Gift Aid is money from the government (federal or state), the college, or other sources that does not need to be paid back. Self-Help Aid is money that either needs to be paid back or earned through work study. By comparing these two categories—on a school-by-school basis—you will find how much of the final bill you and your family will be required to foot. The second aspect of your award letter is
the Full Cost of Attendance, which includes tuition, fees, room, board, books, transportation, and any miscellaneous charges.
Calculating Need. After figuring out how much school will cost and how much financial aid you’ll receive, you can determine the unmet need or gap that you will have to pay. To find your need, take the Full Cost of Attendance and subtract the total amount of aid offered (both Gift Aid and Self-Help Aid). All schools don’t cost the same and every financial aid package is different, so it’s important to follow this exercise for each college you get into.
Making a Decision. Finances are the number one reason cited by students for not finishing college, so it’s very important that you carefully consider cost when choosing a school. Be mindful of how much debt you’ll have at graduation because it can impact major life decisions like buying a home or what jobs you can accept. Once you’ve decided which school is the right fit academically and financially—in the short and long term—then you’re ready to decide.
Final Tips
1. Don’t hesitate to call a school’s financial aid office if you don’t understand your award letter.
2. Remember that the offer you’re considering—unless it says differently—is only for the first year, not for all four years!
3. Consider living at home if your college is close by, even for just a year or two. It can save you a lot of money!
4. Search for outside scholarships to help bring down your tuition.
5. A tuition payment plan can help break down your unmet need into small, manageable payments that are interest free!