Category Archives: financial aid

admissions, financial aid

10 Steps to an Affordable College Education

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college affordable

How can you assure that your student receives an affordable college education?

I received this comment on one of my blog posts from a parent:

I am so unprepared. I had no idea about the steps I should have taken. My daughter officially started class yesterday and I am struggling to figure out how to pay for it. She made above average grades and a wonderful ACT so I really figured she would get some kind of offer. She did not and we are middle class but FASFA says we make too much money. I am in such need of help and guidance.

This is the predicament of so many middle class families. Their student applies to college, is accepted, and receives no financial aid. They are stuck with the dilemma of sending them to this college and finding a way to pay, or disappointing their child and also incurring debt so she can attend.

Before you find yourself in this situation, here’s my advice on how to get an affordable college education and avoid this difficult conversation with your student.

Step 1—Get good grades in high school

There is nothing more important to receiving good financial aid than good grades. These habits actually begin in middle school and build until your student applies to colleges. Good grades represent a commitment to education and academic excellence—two things colleges look for in an applicant.

Step 2—Take AP Honors and/or Dual Credit classes

Colleges look for students who take these college-level courses increasing your student’s chances of merit aid. But the best benefit of these classes is the cost savings you will realize. If your student takes AP classes, takes the test and does well, he will receive college credit. Dual credit courses are taken during high school and once completed, count for college credit. Comparing the cost of an AP test or Dual Credit course to the cost of a course in college, you save thousands.

Step 3—Score well on the PSAT

If your student scores well on the PSAT and is a National Merit finalist, the financial flood gates from colleges will open. Your student should take this test as seriously as she does the SAT or ACT. It’s more than a practice test!

Step 4—Score well on the SAT and/or ACT

Standardized test scores will have an effect on the college’s financial aid award. Good grades, a good essay, and good test scores will make you a desirable candidate for admission which can mean merit aid.

Step 5—Apply for scholarships like it’s your job

Your student’s #1 job in high school is to apply for scholarships. Don’t wait until senior year. There are scholarships available for all ages. The more he applies, the better his chances to win. Keep applying during college too!

Step 6—Apply to the right college

If your student is at the top of the applicant pool, it is more likely she will receive financial aid. Colleges reserve merit aid for the students they want to attract. Applying to an elite college where there are hundreds of applicants with better grades and test scores the chances of being awarded financial aid are slim. But if your student applies to a college where most of the applicants scores and grades are average and your student’s are stellar, the chances of receiving financial aid are good.

Step 7—Search for colleges with good financial aid footprints

Use sites like CollegeNavigator and CollegeData to find colleges that award a high percentage of financial aid to admitted students. If your student applies to a college that offers a low percentage of aid, you are gambling with your financial aid. A sure bet would be a college that meets a high percentage of a student’s financial need.

Step 8—Compare financial aid awards and appeal

Once your student receives financial aid awards compare them with one another. Use the top awards to bargain with the college your student most wants to attend. Appeal the awards and ask for more aid. If you don’t ask, you won’t receive. Colleges have award money available from those students who declined admission.  If they really want your student, they might increase the award.

Step 9—Work during high school and college

You would be surprised at how much money your student can earn during high school. If he or she is too young to work at traditional jobs, there is always babysitting and yard work. Be sure you put the money in your own account, however. Student savings will decrease your EFC substantially. And during college, your student should work. Studies show that students who work are often better students and time managers.

Step 10—Go for the gold

If your student is open to attending a tuition-free college your worries will be gone! These colleges are not for everyone but they are worth investigating: 8 Colleges Where Students Attend for Free.

Best advice: Determine before your student applies to college how much you can afford to pay if he or she doesn’t qualify for financial aid. Even if you follow all of these steps, be prepared for this possible outcome. If you do, you and your student won’t go into debt or be disappointed when the answer is no.

college costs, college planning, financial aid

Paying for College: The Best Strategy

 

paying for college

Last night I spoke with a relative whose son just had a baby. The parents were already developing a strategy for paying for college. When she told me they were planning to enter their child in beauty pageants to foot the bill, I had to interject. I told her this was certainly going to cost the parents money and  the rewards would probably not be worth the effort. Then I told her the best strategy to pay for college: good grades.

According to an NACAC survey, colleges rank the grades in college prep courses, the strength of curriculum, and grades in all courses as the top factors in the admissions decision. But here’s the added bonus, those grades can also net a student huge rewards in financial aid. Many colleges will award automatic full-ride scholarships to students with high GPAs and class rank.

Instead of placing all your college money “eggs in one basket”, in addition to saving, use these three strategies to create a plan that will pay the college tuition bill:

Focus on academics

The tone is set freshman year. Make it a goal to choose the pre-college courses (AP and Honors) and get the best grades possible in these courses. If your student does poorly freshman year, it makes it difficult to catch up later. All throughout high school, your student should place high value on academic progress: commit to study, prepare for class and tests, seek help when needed, and put academics before any other activity.

Apply for outside scholarships

Start applying for scholarships as early as possible. Waiting until senior year is a poor decision. There are scholarships available for all ages. It should be your student’s “job” during high school to search and apply for scholarships. An hour a day can produce huge rewards and start racking up funds each year to make a huge dent in the tuition bill.

Chose the colleges with the best financial aid footprint

What does this mean? Look for colleges with a high percentage of financial aid. Every college reports the statistics related to their financial aid profile. These statistics can tell you how generous they are with their scholarships and grants and also the percentage of students who receive help with their tuition.

The best resource available for these statistics is College Navigator. You can enter the name of the college, or search using criteria such as location, size, and degree plans. Once you’ve pulled up the data, you can use it to compare colleges.

If you use these three “paying for college” strategies, no matter where you are in the process, your student should be able to graduate from college with little or no debt. Additionally, you should be able to pay for college without borrowing or dipping into your retirement (which I never recommend).

academics, college guidance, financial aid, parenting

My Daughter Turned Down a Full-Ride Scholarship

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full-ride scholarship

 

During this financial aid award season, several years ago, my daughter had to make a difficult decision: which college would receive her acceptance of an offer of admission. Of the many colleges she applied to, they included private colleges, state universities, and trade colleges. Some offered her financial aid, others did not. It was a heart-wrenching decision for her: choose the college that offered the best financial aid package with a full-ride scholarship, choose her dream college that gapped her offering no financial aid, or choose the college that was her perfect fit.

For me, it was a no-brainer. One college offered her a full-ride scholarship, along with the major she wanted to pursue. It was in the city she wanted to live in. All the boxes were checked off. There was one problem, however. Since the college was over 2000 miles away from her home, she applied without ever visiting the campus.

Still stuck on her dream college, we scheduled college visits to the other colleges on her list. Here’s where the emotional issue of choosing a college entered into the mix. For teens, the college choice is always more emotional than practical. For parents, this factor makes it even more difficult for you to guide your student in the best decision.

After visiting three colleges in the same city, one her dream college, she was faced with a difficult choice. If it were up to her, she would have chosen her dream college. Knowing this decision would put her into debt, I was able to convince her to look at the other schools.

One of the other colleges offered her a full-ride scholarship; but when we drove onto the campus she immediately balked. Her reaction was so severe that she wouldn’t even get out of the car. My reaction—total anger and frustration. But I knew that I would regret forcing her to consider this college when she was so adamantly against it. So we drove away and moved on to the next college; knowing full well this meant she was turning her back on a full-ride scholarship.

The next college was a slam dunk. She loved the campus. She loved the tour and the students she met. She loved the location, its surroundings, and the total college experience it offered her. It was a small campus and since she would be so far away from home, it would be easier for her to assimilate in this type of environment. Since it was a liberal arts college, she could minor in English—something she had always wanted to do. The next best part, their financial aid package was doable. With her scholarships, grants and work study, she would only have to take out minimal student loans.

Seeing her turn down a full-ride scholarships was a tough pill to swallow. As her parent, I was completely focused on the financial aspect of the decision. But once I saw how excited she was about the other college and saw the smiles on her face, I knew this was the right decision.

Letting her make an emotional college choice (coupled with some financial sense) was the right decision. She flourished at that college. She met lifelong friends. She was able to get a well-rounded education and graduate with a degree that was employable. She still thanks me every day for letting her make that emotional choice and for also standing firm on the impracticality of her dream college.

Choosing a college is a highly emotional decision for your student. Your job as a parent is to guide them into a practical choice while taking into account that you want a happy student going off to college. Although financing should be a key part of the decision, it’s not always about the money.

admissions, financial aid, parenting

Wednesday’s Parent: Why Can’t I Attend My Dream College?

 

dream collegeThis past week, I’ve been discussing the financial aid awards and how they affect your student’s college choice. When those award packages arrive, it may be time for some tough love. The award may not be enough to justify sending your college-bound teen to her dream college. If your student asks this question, “Why can’t I attend my dream college?”, be prepared for an answer.

I had to answer that question when my daughter was accepted to a college she had dreamed of attending since middle school. She worked hard to be accepted and when her offer of admission arrived, she was beyond excited. Her dream had become a reality–until the award package arrived. Then, she was crushed. The only aid they offered was federal student loans. She had been “gapped” and I knew we were going to be forced to cross that college off the list. Yes. She had applied to other colleges that offered substantial aid and scholarships. Yes. They were colleges she wanted to attend. But they weren’t her first choice and her dream college was within her grasp. Or was it?

I had to have a very tough conversation with my daughter. I explained to her the cost of the college was way beyond our ability to pay. We discussed student loans, parent loans and appeals. But we both knew that racking up debt to attend was not logical or financially practical. We had placed all her dreams on financial aid and when it didn’t measure up to our expectations, we were forced to move on; with many tears, much sobbing and tremendous disappointment.

We took a look at the other offers of admission. With scholarships and aid, she would only have to take out minimal student loans; making it manageable to pay back after graduation. One college even offered a full-ride scholarship. It was clear that these colleges wanted her and demonstrated it by backing it up with generous aid packages. There were some strong contenders among the other colleges and it was time to take a second look; and we did.

We visited the colleges that offered the greatest amount of financial aid. She toured the campuses (some for the first time) and was able to see herself at two of the colleges that offered similar aid packages. What was the deciding factor? Location. She chose the college that was in the same city as her dream college. Part of the lure of the dream college was the location and since this was at the top of her list, it tipped the scales for her.

What was the outcome? She fell in love with her second choice college. It was a perfect fit for her academically, socially and financially. But the real payoff was at graduation when she had minimal student loan debt and was able to start her life without the burden of unmanageable student loan payments. Our smart decision paid off; and she understand why she could not attend her dream college.

admissions, financial aid

What is Financial Aid Front Loading?

 

My fellow college expert, Wendy David-Gaines, shared some insight into this college practice. This article originally appeared on her site: 5 Questions to Ask About Financial Aid Front Loading. 

financial aid front loading

If you think your washing machine is the only front loader, watch out because your college may be taking you to the cleaners. Front loading happens when colleges make their most generous financial aid award offers to applicants as a lure to attend. When students return the following year they may find their school has dropped their previously awarded grants and scholarships. Thousands of dollars may have been lost to the common practice of front loading.

“About half of all colleges front-load their grants, according to financial aid expert Mark Kantrowitz, who analyzed data from the National Center for Education Statistic’s Integrated Postsecondary Education Data System,” according to DailyFinance.

The lesson for parents and their college-bound students is to carefully scrutinize, analyze and question each item in their financial aid awards before bothering to compare one college’s offer to another. It may turn out that freshman year is a best deal at one place but if the total years until graduation are tallied, another choice may be the better bargain.

[ctt title=”Is the college front loading on your financial aid award to lure your student?” tweet=”Is the college front loading on your #finaid award to lure your student? http://ctt.ec/0dJdS+ via @suzanneshaffer” coverup=”0dJdS”]

Here are five questions to ask the college financial aid officer:

Is the grant/scholarship renewable and if so for how many years? What you want is the money to continue until the student graduates. Bear in mind it is taking longer, four to six years, for those who graduate to do so. Find out the maximum number of times the award will be made.

What are the strings attached to keeping the grant/scholarship? It’s important to understand the terms of receiving free money awards before acceptance to make sure the student can and will perform them. He may have to keep his grades up, play an instrument, or be a member on a team. Find out the eligibility requirements each year including any additional paperwork necessary to keep them.

If the grant/scholarship is lost, what will replace it? Often student loans are the college’s substitution plan. However, there may be other grants/scholarships available. Ask about them and the application process. Be prepared to continue searching for these and have a college finance Plan B.

Will the college bill increase in following years and if so, by how much? Those renewable grants/scholarships may no longer cover the same portion of college costs if tuition rises. See what if any cost components like tuition/fees and room/board are capped or held at the freshmen level.

Will the grant/scholarship be increased to keep pace with any raised college costs? Be aware most colleges will not match tuition increases or increase free money aid when tuition rates increase. However, the college bill must continue to be paid.

admissions, financial aid

Is the College Gapping Your Student?

college gappingIn London, you see signs and tourist shirts everywhere that say “Mind the Gap”. If you ride their underground transportation system, you will hear them announce “mind the gap” at each station. It’s a warning for passengers to be aware of the distance between the train and the train platform.

In admissions, college gapping is a term used in reference to colleges and financial aid awards. The gap between what you can afford to pay (your EFC) and what colleges offer in aid creates this gap. Gapping happens when a college makes an offer of admission and doesn’t back it up with financial aid. Quite simply, the college doesn’t offer enough aid to cover the difference between the cost of the college attendance and your expected family contribution.

Gapping is a serious business. Colleges use the tactic to “weed out” the good applicants from the average applicants. Quite simply, if your student is at the top of their applicant pool, they will receive the aid required to attend. If not, your student will be gapped, in the hopes they will reject the offer of admission.

It’s a numbers game. Colleges offer admission to more students than they can possibly accommodate. Gapping helps them lessen the number of students who accept those offers of admission.

[ctt title=”Is the college ‘gapping’ your student? Heed this warning: MIND THE GAP!” tweet=”Is the college ‘gapping’ your student? Heed this warning: MIND THE GAP! http://ctt.ec/_C5H8+ via @SuzanneShaffer” coverup=”_C5H8″]

The warning you can hear in the London tube, is the same warning parents should hear when opening financial aid packages: Mind the Gap! Sometimes, gapping isn’t obvious. Colleges will pad the EFC numbers with federal student loans, federal parent loans and work-study. These should NOT be considered when determining if the college is gapping your student. All students qualify for federal student loans. College aid should only be in the form of merit scholarships and grants. If the difference between what you can afford and what the college offers is padded with loans, the college is gapping your student.

For more information on why colleges practice gapping and how to avoid being gapped, read this article I wrote for TeenLife: How to Avoid “Gapping in College Admissions. Lynn O’Shaughnessy also explains gapping in her article: Don’t Let Colleges Snooker You.

financial aid

Bummed About Your Financial Aid Award Package?

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financial aid

Picture this. A teenage daughter with her heart set on attending an expensive private college. A mother who knew it was simply not affordable unless the financial aid award package was substantial. Waiting, waiting, and more waiting for the package to arrive after she heard she was accepted.

I’m sure this is the scene in many of your homes today. As a parent, you know the financial realities of paying for college. Your student, on the other hand, is thinking with her heart. If she’s like my daughter, she can’t see the picture from a financial perspective. After waiting for the award to arrive, my heart sunk. When her first choice college offered her “zero” financial aid other than student loans, I knew we were headed for a tough conversation.

If you’re bummed about your financial aid award package, what can you do?

First, compare awards from all the colleges

My daughter applied to ten colleges. Not all of them offered aid beyond student loans, but several of them offered scholarships and school grants. Sit down and compare the awards. Many colleges have implemented the Financial Aid Shopping Sheet. If not, you can download the sheet and complete it yourself for each college. Look at the bottom line. Which college’s package gives you the best value: it’s what you can afford to pay and your student will graduate with minimal debt (if any)?

Second, if there are larger awards from other colleges, use them as leverage

Since one of the colleges that offered my daughter admission also offered her a full-ride scholarship, we had some leverage. If the college that your student is dying to attend doesn’t offer a substantial aid package and one of the other colleges she applied to does, use those figures for leverage. Have your student contact the college and let them know it is her first choice, but she needs more aid to be able to attend. Mention that other colleges are offering more aid and you would like them to at least match these offers. These appeals are common and most colleges will consider upping the ante if you just ask.

Third, if the college won’t offer more money, consider one of the other colleges that offer the best financial aid

After appealing the aid, and not being satisfied with the college’s decision, it was time for some tough love. I knew it was going to break her heart, but I had to be the logical one. If the money picture is bleak and her first choice college won’t budge, it’s time for your student to consider one of the other colleges that did offer financial aid. Take a deeper look at the other colleges, revisit if you have to, and make the final decision.

As it turned out, my daughter fell in love with one of the colleges that offered substantial aid. It was a perfect fit for her, and she was able to graduate with a very small amount of student loan debt. She thanks me every day that I led her in that direction. If she had attended her dream college, even with the outside scholarships she had won, she would have graduated with close to $75,000 worth of debt. It was a tough conversation, but one I’m glad we had.

Could this disappointment have been avoided? Absolutely. I should have had a serious talk with her before she applied about what we were willing to pay and what we expected her to pay. This way, she would have known that this college, although it was her dream to attend, was completely out of our financial reach.

FAFSA, financial aid

Art Imitates Life: Opening the Financial Aid Award Package

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What’s more scarier and nerve-racking than waiting for the college decision? Opening the financial aid award package. Families all across the country are waiting for the arrival of their financial aid award, knowing that their student’s ability to attend college depends on the amount of the award.

This is such a universal anxiety among parents, television shows have written episodes around the issue. My three favorites, Gilmore Girls, Dawson’s Creek, and The Middle paint a picture of how the award letter affects college attendance.

Dawson’s Creek

Joey Potter is accepted to a high-priced private university in New England. But accepting the offer of admission depends on her financial aid package. When she receives it, they didn’t offer her a full ride. She and sister meet with the admissions counselor, who tells them that since their business is doing well, Joey doesn’t qualify for financial aid.

financial aid award package

The counselor says, “Nearly everyone these days borrows some money to pay for college.” Joey replies, “I don’t want to do that. i don’t want to graduate with debt.”

Gilmore Girls

As graduation day approaches, Rory learns her financial aid was rejected. The irony, her mother received some financial assistance from her grandfather that altered the FAFSA results. Even though they were financially unable to pay, that money took them out of the running for aid.

financial aid award package

Rory’s mother explains, “We didn’t get financial aid for Yale. No scholarships, no hardship money, nothing.” Devastated, Rory questions, “I don’t understand what happened. Send them proof. A bank statement. I’ll take a student loan out from the bank. That’s what banks are for.” Her mother counters, “I don’t want you to be buried by loans the day you graduate from college.”

The Middle

Sue Heck opens her financial aid package and has problem deciphering it. She’s not alone. Many students and their families have difficulty understanding the award letter and don’t know how to compare awards from different colleges.

financial aid award package

As Sue is opening the package, her parents are screaming, “What’s it say!” Sue responds, “I don’t know. Is it one year or four years?” Her father grabs the letter and immediately exclaims, “Yes! They’ve given us everything we needed. We’re poor. If we had worked a little bit harder, none of this would be possible.”

In each of these episodes, the students managed to attend their first choice college without incurring debt. Two from generous benefactors who paid their tuition and one who received a full ride. But there are underlying realities that parents must face:

1. The college decision is first and foremost a financial one–I’ve said it before and I will say it again: have the “money talk” before you apply to colleges. This avoids any disappointment if the college does not offer enough aid to cover your costs.

2.  Even though a college offers admission, it doesn’t mean you will receive financial aid–Colleges use the money to attract the most desirable students. If they don’t consider that your student is desirable, they won’t offer aid or they will gap you.

3. Families anguish over the high cost of college–College has become increasingly expensive and it’s clear that the decision to attend college is not based on the education alone.

In the next few weeks I will be sharing my own personal experiences how to decipher the award package, how to compare with other colleges, and how to determine if a college is “gapping” you. Before the letter arrives, be prepared to take an honest look at your finances and have a discussion with your student about the weight the package plays in their acceptance of admission.

FAFSA, financial aid, Uncategorized

From FAFSA to Financing: Financial Aid 101

financial aid 101

As part of NBC News’ Education Nation initiative and our Parent Toolkit site, my team hosts a monthly Twitter Chat about a variety of different education and parenting topics.

On Tuesday, January 19 at 7 pm EST we will be cohosting our monthly #ToolkitTalk conversation with the First Lady’s Reach Higher Initiative called From FAFSA to Financing: Financial Aid 101.  The chat will focus on information that high school students and their parents need to know about affording a college education.  Our featured guests will include the National School Counselor of the Year and representatives from the Federal Student Aid Office.

Join me and @EducationNation and others discussing tips for parents regarding financing a college education.

FAFSA, financial aid

FAFSA Week: 10 Good Reasons to File the FAFSA

 

file the fafsa

Parents of college-bound teens look forward to filing the FAFSA as much as they look forward to filing their income taxes. It’s a federal form and all federal forms aren’t exactly user friendly. Many parents are so intimidated by the form that they choose not to file, telling themselves that their student wouldn’t qualify for aid anyway because they make too much. But don’t fall into that trap.

Here are 10 good reasons to file the FAFSA:

1. College is expensive

Even if you’re rich and can afford to pay for your child’s education, it’s expensive. Why would you pass up an opportunity to help with some of the cost?

2. It’s FREE

That’s right. It’s completely free to complete the FAFSA. You’ll spend some of your time completing the FAFSA and you could get thousands of dollars of financial aid in return. So one could say, it’s BEYOND free–they pay you!

3. Getting help is easy and FREE

If you get stumped, help is available using the online help tool or by submitting a question at the FAFSA web site or calling the help number listed on the site. Many schools even host a FAFSA day where they offer help to parents and students on how to complete the free form.

4. FREE money could be waiting for you

According to a recent Reuters article, about 1.8 million lower income undergraduates who might have qualified for aid neglected to file the FAFSA and missed out on financial aid. No matter what your income level, you should file the FAFSA because there is more money out there to be awarded than just need-based aid.

5. Federal money

The federal government provides over $80 billion dollars in grants, loans and work-study programs every year. The only way to get pell grants, perkins loans, stafford loans and other federal aid is by submitting the FAFSA. Federal loans offer the best interest rates and repayment terms for student borrowers and are superior to private student loans.

6. State money

FAFSA is the gatekeeper for state financial aid programs. Each state’s programs are different but they all require the FAFSA to distribute the funds. Check with your state’s higher education agency for deadlines and requirements. In some states the financial eligibility ceilings are much higher.

7. School money

Colleges and private scholarship sponsors offer billions of dollars in financial aid. Even if you don’t have financial need, you may be eligible for these awards. Some school and private scholarship programs are specifically designed for students who were rejected by federal financial aid. Some schools will not award merit aid unless you complete the FAFSA.

8. Scholarship applications ask if you’ve applied

In addition to the aid that a student may receive from federal and state agencies, many scholarship applications include a box to check asking whether the student has submitted a FAFSA. According to Monica Matthews of How to Win College Scholarships, “Scholarship providers want to know that the student is doing everything possible to get financial help in paying for college and submitting the FAFSA is a very important step in the process.”

9. You have two or more children in college

With two in college, your expected family contribution (what the parents can afford to pay) drops by 50%. Even if you didn’t get financial aid with the first, file the FAFSA because having a second child in college can net you some financial aid.

10. You really don’t have a choice

Look at it this way: FAFSA is the ONLY way to be considered for federal, state and college financial aid. Even if you don’t NEED the aid you still want to get it. Who doesn’t want FREE money?