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Comparing Financial Aid Offers

Choosing a college is an individual decision, and every student has their own dream school that they would attend regardless of cost, as long as they got in. Most students choose between several colleges that they have been accepted to by looking for the best education for the best deal. Students who apply to a lot of schools will have more financial aid letters to compare. Each college financial aid package is a little different, so use this guide to help you understand your offers.

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Cost of Attendance

Cost of attendance is the first thing to compare in yourfinancial aid packages. The cost of attendance is the amount a college/universtiy predicts will cost the average student to attend for one year. This number includes tuition and fees, room and board, textbooks educational materials, and other living expenses such as shampoo, toothpaste, extra food.

Factor in your expected family contribution and unmet need while comparing packages from each school. The expected family contribution is the amount you’re expected to pay based on your FAFSA. Note that some private schools use the CSS Profile. This is the minimum amount of out-of-pocket expenses. The award letter also includes your unmet financial need which is equal to the cost of attendance minus your financial aid. That is the amount you need to pay to just meet the average cost of attendance.

Tuition, fees, and housing costs are printed on a tuition statement from the school and do not need to be paid in full up front. However, the cost of attendance is a good guideline for what to expect to pay for school. Remember, the school that gives the highest percentage of financial aid can still be more expensive than other schools. For example, less expensive public schools that give a lower amount of financial aid often have a lesser cost of attendance than private schools. Cost of attendance, not financial aid, is the number to compare in your packages.

Institutional Scholarships and Grants

The next important thing to consider and compare are institutional scholarships and grants. Institutional scholarships and grants are awarded directly from the college. These awards are often not clearly marked, named differently in different places, or lumped in with federal aid or student loans so make a list of awards at each school, noting the amounts, names, and conditions of each award.

Details such as the length, amount, GPA/academic requirements, extracurricular requirements, and renewal requirements for each award you receive are described in a letter within your financial aid package. Keep in mind colleges that offer a lot of one-year awards, or awards with a lot of conditions are less beneficial than colleges that offer a smaller annual awards that are easily renewable. Pay attention to the college’s, and the scholarship’s/grant’s, rules regarding other financial aid, especially at schools that have programs that fill your total financial need because the amount of scholarships or grants you’re awarded depends on how much other financial aid you have received. These are called “last dollar” awards, meaning they are designated to be the final dollars towards your unmet financial need. If your total grant and scholarship awards exceeds your level of need these awards are reduced. If you cannot pay your family contribution out-of-pocket, you will have student loan debt. First dollar scholarships and grants are applied to your bill first, so you do not have to worry about other scholarship/grants being reduced.

Federal Aid

If you complete aFAFSA is you qualify for federal student financial aid. The amount you are awarded will be detailed in the letter that is included in each school’s financial aid package. The following awards are included in the list: Subsidized and unsubsidized Federal Stafford Loans, Federal Perkins Loans, Federal Work-Study, Supplemental Education Opportunity Grant, and Federal Pell Grants if you qualify. State grants are also listed on the award letter. State aid is also awarded based on the FAFSA and has similar requirements to federal aid.

Federal aid is uniform across schools. Institutions can chose whether they want to award Perkins Loans, supplemental grants, or a little of both, but the amount distributed is the same. Your Pell amount, is also the same throughout. Stafford Loan amounts vary, depending on how much you have received from the university and/or other scholarships.

Federal Plus Loans are not automatically awarded, but are listed by some schools as a way to supplement your unmet financial need. Your parents apply for this loan, so it should be treated as a suggestion, not an award. Plus loans have high interest rates compared to other federal loans, though their rates are better than most private loans.

Other Aid

Outside scholarships are also listed on your letter. These are taken into account when calculating your financial aid amount. If you have won a lot of scholarships, it can affect the amount you are offered at each school. Before you compare financial aid awards and make a decision, factor in your other scholarships.

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Last Reviewed: November 2021