Financial aid packages are confusing.  The line items can look innocuous but you need to look more closely at the underlying roots to learn the long term implications.  Loans have varying (and variable) interest rates, work-study funds are not credited to your bill, and sometimes (but not always) there is a difference between academic scholarships and grant–to name a few of the complexities.

This month we have spent time with clients looking at financial aid packages and teasing out the true cost of attendance over the next four years.  This isn’t easy because financial aid letters are not uniform.  For example, some schools do not include the full cost of attendance, or the family’s EFC (estimated family contribution) as determined by the FAFSA and CSS Profile (used by some schools).  It can become a big headache.

We sat down with clients and worked through the four year loan expectation, college work-study, and discussed the difference between grants and academic scholarships.  Additionally, we discussed strategies for approaching the financial aid offices to appeal the initial award.  Our background in financial aid helped inform strategy formulation, how to frame the discussion, and questions to ask.  Make sure you know:

    • School’s policy regarding a change in family financial circumstances,
    • Policy regarding more than one student in college (or no longer have two in school),
    • If any of your scholarship aid is contingent on GPA,
    • Total Estimate Family Contribution (EFC ),
    • Total Cost of Attendance–and will this change is student commutes, and
    • What (if any) is the impact on institutional grant or scholarship if your student wins an outside or private scholarship?

Remember families must reapply for financial aid each year and depending on family situation and financial status, financial aid eligibility can change dramatically over those four years.  Make sure you know what can impact your students financial aid over his or her undergrad years.  The first year financial aid package is important but more important is understanding each school’s financial aid policies so that you can project your student’s aid package over all four years.