Pay For College

Written by Don Betterton, Principal in Betterton College Planning LLC and former Director of Financial Aid, Princeton University

This is a very large topic with numerous publications and web sites devoted to helping families navigate through its complexities. Here, we will offer guidance on how to organize an effective financial aid strategy.

Assuming you are among the 75% of American families that cannot pay the cost of college without assistance, you should increase the time you spend on the subject of paying for college to be more in line with the time you spend on the admission process.

When a student has set his sights on attending one of the 400 or so competitive colleges, admission preparation is extensive – taking hard courses, studying for standardized exams like the SAT, meeting with the guidance counselor, making college visits, finalizing a list, and completing the applications.

In contrast, what does a family do to prepare financially?

Typically they look up the requirements for the aid application, struggle with filling out the forms, wait for the college to send an award letter, and choose a college without a clear understanding of what their bottom line cost will be.

Taking only the most basic steps to do what is necessary to get an aid decision is not good college financial planning. We recommend that you get more “on top’ of the process by doing some or all of the following:

• Run a financial aid estimator to see approximately how much the need formula will expect you to pay — your Expected Family Contribution (EFC).

• Compare this EFC estimate to the Cost of Attendance at your colleges to judge if you might “demonstrate need” and therefore qualify for financial aid. [If not, you should plan to pay the college bill from your own resources or look into non-need based help such as merit scholarships and student and parent educational loans.]

Assuming it is likely that you will qualify for aid, you should:

• Learn generally how financial aid works (by reading the rest of the articles on this site or researching online – a great place to start is the Department of Education’s website called Student Aid on the Web – www.studentaid.ed.gov).

• Carefully review the aid policies, application requirements, and deadlines of each college on your list.

• Start an aid file containing this information for each school. Later on, this file will contain copies of the aid applications and other relevant material.

• At a minimum, for your top 1 or 2 colleges, plan to have a personal discussion with an aid counselor. Your initial EFC calculation and need estimate is only a starting point. Colleges have their own aid policies that can affect your need estimate by, in some cases, thousands of dollars. You should find out more about how these policies are likely to change the amount of aid you will receive before the award decision is made.

• Once you have learned more about your probable need level, ask about how the college “packages” aid. In other words, how they combine grant, loan, and work-study. There can be large differences in the “quality” (the larger the grant, the better) of an award among different colleges.

• Keep looking for an available merit aid, within or outside the college.

You should educate yourself as a financial aid consumer and not let the process go on without your involvement or understanding.

The purpose of gaining this “aid education” is to learn more about how much you will be asked to pay for college before the college list becomes final. (There may be some modification of the original list based which of the colleges is affordable.)

It is important that you acquire enough knowledge about aid to prevent an unpleasant surprise — getting admitted to your “school of dreams” and finding you are unable to attend for financial reasons.