Financial Aid

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Why Some Financial Aid Offers Will Underwhelm

Dobler College Consulting

Last week I talked about three things you need to know about the costs of college: your EFC, how admissible your son or daughter is and merit awards. If you missed the post, here it is:

What You Need To Know About The Costs Of College

Today I want to take that conversation a step further and give you an example of why it is so important for a student to know just how desirable he or she is.

When the conversation rolls around to how much aid a college is going to award, sometimes the more desirable a student is plays a significant role. According to NACAC’s 2012 State of College Admission report only 32% of publics and 18% of privates were able to meet 100% of each student’s demonstrated need.  The remaining colleges have to decide how to allocate their money and not everyone gets the same amount. If they did, every college would meet 100% of everyone’s need.

And we all know that doesn’t happen.

So what dos end up happening is that colleges have to choose which students get the most aid. To put it simply, the more desirable the student, the more aid they will be awarded. So what makes an applicant more desirable? It depends on the college and while you can’t know everything they are looking for in a given year, there are at least two things any applicant can easily figure out.

GPA and test scores.

Knowing what kind of grades and test scores you will need for admission is something you should seek out about every school you are interested in. You can find this information rather easily on the College Board’s Big Future website. As I talked about in a post I wrote in September called, College List Tip: What Are Your Chances, you will find a range of test scores, GPA’s and even class ranks. This is valuable information for any applicant to look at and understand. These figures are provided by the colleges themselves. They are real numbers and they will show you just who the college thinks is desirable and, therefore, who will receive the more generous aid awards.  Applicants should read them and understand them as they search for colleges.

There’s a big difference between a college A where SAT scores for Math and Critical Reading of 500 fall in the top 25th percentile and college B where those same scores fall in the lowest 25th percentile.

If an applicant has fallen in love with college B and is expecting a lot of aid, they are very likely going to be disappointed.

Have something to say? Use the comment box below or email me at eric@doblercollegeconsulting.com. If you think this makes a lot of sense, consider sharing it with someone you know.

 

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10 Things You Need To Know About The FAFSA

As we head into the end of January, high school seniors and their parents are filling out the Free Application for Federal Student Aid (FAFSA). While some of them might be done or just about done, ten things every family needs to know about filing the FAFSA:

1. It’s free. If you end up on a website that requires a fee to file the FAFSA, you’re in the wrong place.

2. It’s THE form required by ALL colleges which award federal aid. No FAFSA, no federal aid.

3. Both the parent and student need to obtain a PIN at www.pin.ed.gov before filling out the FAFSA.

4. For current seniors, the FAFSA has been available for filing since January 1st and the deadline is June 30, 2014. Yup, that’s right, 2014. Keep reading.

5. It runs on a July to June calendar where July 1st marks the “New Year.”  In other words, current high school seniors who intend on starting college this coming fall should be filing the 2013-2014 FAFSA.

6. To be considered for state grants, Connecticut residents must file by February 15th.

7. The FAFSA determines your EFC, your expected family contribution. This is the amount of money colleges will expect you to pay for one year of tuition, room, board and fees.

8. This EFC calculation is based on income and assets, not retirement money or home equity.

9. When parents are divorced or separated, the FAFSA is calculated on the parent who the student lives with for the majority of the year, the custodial parent.

10. When the custodial parent is remarried, the income and assets of the step-parent are included in the FAFSA calculation as well. It’s a federal law.

And the item I remind parents of all the time? You don’t need to have your taxes filed to fill out the FAFSA. Just enter an estimation based on the previous year. Then, when your taxes are filed, use the federal data retrieval tool to upload final information.

Have something to say? Use the comment box below or email me at eric@doblercollegeconsulting.com. If you think this makes a lot of sense, consider sharing it with someone you know.

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Why You Should Know Your EFC

Last week I wrote a post about understanding the difference between net price and sticker price. Today, I wanted to carry the financial torch a bit further by talking about EFC.

EFC? What’s that you say? Another acronym?

Yup. The world of college admissions and financial aid is full of them.

EFC stands for expected family contribution. It is the amount of money you will be expected to contribute towards one year of your college costs. While it won’t paint the entire picture for you, it will serve as a starting point before you venture into how generous a school is with their aid. You won’t know your official EFC until after you’ve completed the Free Application for Federal Student Aid (FAFSA) and, in my opinion, this is too late. You can’t fill out the FAFSA until after January 1st of the student’s senior year when decisions on where you are applying have already been made.

Rather, you should know your EFC before you start getting too deep into looking at colleges.

Parents of freshmen, sophomores and juniors, I’m talking to you.

For example, let’s say your EFC is $25,000. If you are looking at a college where the cost of attendance is $55,000 you can immediately see that you will be hoping to get $30,000 in aid. Conversely, if the college’s cost of attendance is $30,000, you shouldn’t be expecting much of anything outside of the basic student loan.

In the case of the former, $30,000 is a big difference to make up. The next step is to understand just how generous a school is and if they are going to help you out. Typically, the biggest factor in whether or not a college is going to offer you a financial aid package that meets your need is how competitive you are as an applicant.

Do yourself a favor and obtain your estimated EFC now. Write it down, understand it and use it when you are researching schools and want to know what a school is going to cost you.

If you have questions or would like some help figuring out how to reduce the cost of college, use the comment box below or email me directly at eric@doblercollegeconsulting.com. I would love to hear from you!

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How Much Is That College In The Window?

The other day I was working with a student who ended up learning a lot about the difference between sticker price and net price. The student in question was interested in architecture but assumed that schools who offer the program would cost him too much.  In fact, he was prepared to give up on the idea of architecture and pick a different major altogether so that he could attend a local state school here in Connecticut just to save money.

While this is not meant to be a knock on our state schools (I’m a product of two of them), this is a knock on a system that had so far prevented this young man from truly understanding his options.

I proceeded to pull up the College Board website so that I could show him the difference between sticker price and net price. Since he wanted to stay in the Northeast, we narrowed his search down to several schools in the New England and Mid-Atlantic region. For the purpose of this blog, I randomly selected three schools from the list we generated: Lehigh University, Temple University, and Philadelphia University.

Going by the assumptions the student was making about sticker price, one year of college would cost him $55,515 at Lehigh, $38,935 at Temple and $46,282 at Philadelphia. Each one of them a prohibitive cost. But then I showed him the Paying tab on the College Board website and how he needed to look beyond the sticker price of each institution. Upon doing so, I was able to show him that Lehigh’s average first year financial aid package is $34,773 making their net price $20,742. Temple’s average package was $15,373 bringing the net price in at $23,562. Philadelphia University gives freshmen $28,220 to bring the true price down to $18,062.

All of a sudden, not so prohibitive.

Seeing as how this student’s grades and SAT scores fell within the top 25% of admitted students for each school, it’s a safe bet to say he’s probably going to receive the average package from each school. In fact, he may receive financial aid packages that are better than the average.

Another way to figure out what a school is going to cost you is to use a net price calculator. Colleges are now required to include one on their website, though some are easier to find than others. These calculators will ask you to enter some personal information and will then compute an estimated net price. Not all calculators are created equal so be sure to pay close attention to the breakdown of loans, grants and merit money when you get your net price results.

At the end of the day, as this student learned, it pays to do your homework.

If you have questions about net price or would like some help figuring out how to reduce the cost of college, use the comment box below or email me directly at eric@doblercollegeconsulting.com. I would love to hear from you!

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ED, EA, Regular, Rolling – Which Way Should You Apply?

Elizabethtown College

Elizabethtown College

With the launch of the Common Application on August 1st, the 2012-2013 college application season is upon us. If you’re not familiar with the Common Application (more commonly referred to as the Common App), here’s a nice little post from stateuniversity.com that will get you caught up.

Last week I talked about the different ways of applying to colleges. Your level of interest and your qualifications are what will help you decide which one is the way to go. For now, let’s talk about the differences and how they affect you.

Early Decision, also known as ED, is where you choose to apply anywhere from November 1st to December 1st, and can expect to hear a decision by December 15th. Some schools will offer two rounds of early decision where ED I applicants hear in December and ED II applicants, who will apply typically around the same time as regular decision candidates, will expect to hear in February.

Early decision can be a great idea if you know, without a doubt, that you are in love with everything a school has to offer, you know you can afford to attend that school and you are ready, willing and able to commit to that school. You’re all in with early decision and the risk level is significant if you haven’t done your homework ahead of time.

Some things to consider with early decision:

You’re allowed to apply early to ONE school only and, if accepted, that decision is binding. That’s it. There’s no backing out of an early decision acceptance. This is why your love for the school must be true – you won’t have a financial aid award yet and you will have to contact the other schools at which you submitted regular applications and notify them that you are withdrawing those applications immediately. Some students will point to higher acceptance rates to justify their choice to apply early – for this past year, the regular acceptance rate at Duke was 11% while the early acceptance rate was 25%; for Johns Hopkins the rates were 16% and 38% respectively. While the acceptance rates are typically higher, the talent pool is also that much more competitive. Just spend a few minutes on College Confidential and search for “early decision” to tap into the mania.

Early Action, or EA, is where applicants complete applications in November or December and expect to hear an answer by the start of the New Year. Early action applicants can be accepted, denied or deferred to the regular decision round of applications. Unlike early decision, early action applicants are not bound to their acceptance and have the choice to commit by the May 1st deadline or attend another school altogether.

There are variations of early action policies so it is important to check with each school first. Some schools are considered single choice early action meaning that they will not allow applicants to apply to any other schools early. Other schools are considered unrestricted and allow applicants to apply early decision or early action to any number of schools.

Early action is great because you have the benefit of applying early and showing a school that you are a very interested applicant while also keeping your options open.

Regular Decision is the process by which you apply by each college’s published deadline which is usually around January 1st. Once the application and materials have been sent, applicants can expect to hear a decision by April 1st. Regular decision applicants can be admitted, denied or placed on a waiting list. More on waiting lists another day.

Regular decision is the vanilla of the application world. It’s plain and simple and doesn’t come with any surprises. Well, that’s not entirely true. Students who choose not to pay attention to what a school is looking for in its applicants can often be met with very disappointing surprises. 

Rolling Admission is where students are admitted on an ongoing, or rolling, basis. The schools begin making decisions in the early fall and continue until they have met their requirements for the new freshman class. Rolling admission provides students with a long period of time in which they can apply – often several months. Colleges may accept or reject an applicant right away, or they may hold off for a period time in order to compare him or her to other applicants. Depending on how strong or weak of an applicant they are, students may also find themselves on the waiting list.

There are several pros to rolling admission. Applicants can apply as soon as the application season is open and, therefore, demonstrate their interest to a school. Remember, colleges are looking for students who are more likely to enroll. Applying early on is a great way to show that you are that student. Because decisions are made on an ongoing basis, the earlier you apply, the earlier you can expect to hear a decision. It can feel great to get that first acceptance out of the way and may just help you enjoy the holidays with your family and friends that much more.

For the procrastinators, rolling admission is great because you can apply when you’re ready. I’m not saying you should work at a snail’s pace, but let’s be honest – some of you just do. Maybe you want to wait for first semester grades before you apply because you know you have some strong grades coming. Maybe your SAT scores were low and you wanted to take them again in December or January. Maybe you just happened to come upon a school mid-year that you hadn’t thought of before and now want to apply – for any of these reasons and more, schools with rolling admissions grant you the opportunity to apply later in your senior year.

Now, for every pro of rolling admission there are also cons. Just because decisions are rendered on a rolling basis, doesn’t mean everyone will hear right away. If your application isn’t the strongest, you could end up waiting several weeks or more before you hear back. This can get very frustrating when your friends hear back from the same school and you’re stuck waiting and wondering. Schools with rolling admission will start awarding aid on a first-come, first-serve basis. Funds are limited so if you apply too late, your financial aid award may not be very helpful. Housing could also be an issue if you apply too late.

As with anything in the college application process, do your homework early on. Check out the admissions webpage for any schools you are interested to find out which types of applications they offer.

If you have any questions or comments about the types of applications available to you and which one might be the best way for you to go, please use the comment box below – I would love to hear from you!

You can also email me directly at eric@doblercollegeconsulting.com.

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