Last week, I talked about non-need based scholarships your student may be eligible for. This week, I want to cover the other major type of college money: need-based financial aid.
Who May Be Eligible for Need-Based Financial Aid?
There are many myths floating around about who is and who isn’t eligible for need-based financial aid. The truth is, it varies widely. It is based on more considerations than just the household income amount. Some things that make the biggest difference include:
- Total number of dependents
- Number of kids in college at the same time
- Amount of savings that is in the student’s name
- The size of a college’s endowment (schools with the largest endowments give need-based aid at higher income levels)
- Total net worth
There are two calculations I recommend doing: Federal and school-specific. Many schools base your student’s financial aid eligibility solely on the Free Application for Federal Student Aid (FAFSA). Some schools also use a tool called the CSS Profile or they have their own specific financial aid methodology.
To estimate your federal financial aid eligibility, use the FAFSA4caster. It will give you an estimated Expected Family Contribution (EFC). It gives you an estimate of what a typical school will expect you to pay out of pocket. This should be fairly accurate for schools that only use the FAFSA to determine need-based aid.
The second calculation is the school-specific one that is provided through a school’s Net Price Calculator. I have written about Net Price Calculators in many of my articles because I believe they are extremely helpful when you are in the college search process. They provide you with an early estimate and can help you determine schools that may be affordable and schools that are definitely not affordable for your family. Just remember that these are only estimates and the actual financial aid offer your student receives from a school may be higher or lower than what the Net Price Calculator indicated.
Net Price Calculators ask for the same financial information as the FAFSA, and maybe more, depending on how the particular school calculates aid. They may also ask for student information like GPA, ACT/SAT score, class rank and number of AP/IB classes. When they ask for these, it is usually because the Net Price Calculator is also estimating merit-based aid. That is great because it gives you an overall picture of how much aid your student may receive from that school.
The College Board website has a Net Price Calculator that is used by a number of schools across the country. This is a great opportunity to enter your basic information once and see what kind of aid different schools will provide.
One thing to note: There will be a large difference in the calculation depending on the number of students in college at the same time. If you will have some years with one student in and some years with two students in (or more), run the calculators both ways so you can see the difference.
Running the FAFSA4caster and net price calculators will help you narrow down schools at the beginning of your student’s college search. You can eliminate schools you know you can’t afford and focus on those that are reasonably affordable.
Also, keep in mind that once your student is admitted to a college and receives an initial financial aid offer, the aid may be somewhat negotiable at many schools. Have a pleasant conversation with a financial aid officer to explain why you need more aid. It never hurts to ask for more and you may be pleasantly surprised!