When Your Expected Family Contribution is Too High

Published by Wendy Nelson on

Money jar spillWhen your expected family contribution is too high to be affordable for your family, you have several options. I want to address this both for high school Seniors with actual award letters in hand and also for younger students where Net Price Calculators are indicating an expected family contribution amount you know you can’t afford.

Let’s start by discussing when your high school senior receives their financial aid award letters from colleges that have admitted them and the expected family contribution listed is not going to work for your family.

Options When You Can’t Afford Your Expected Family Contribution for the Schools Your Student Was Admitted To

  1. Negotiate – Don’t be afraid to contact the colleges your student is interested in attending to attempt to negotiate the financial aid package. It’s best to let your student do the contacting, but you can coach them for a call or help them craft an email that lays out the appeal. There are really two types of negotiation here:
    • More Need-Based Aid – Follow the school’s financial aid appeals process and provide proof of why you can’t afford what the school thinks you can afford. (Colleges usually only take into account “special circumstances” that weren’t reflected in your financial aid filing.)
    • More Merit-Based Aid – It’s easiest to negotiate when you have better offers in hand from other colleges. Have your student talk to the admissions office and offer to send them the award letters from other schools, stressing why this school would still be the top choice with the right scholarship amount.
  2. Choose the Lowest Priced Option – Hopefully your student had an in-state public college or other more affordable school in their mix. It is difficult to turn down admissions offers from more expensive and more prestigious schools, but if it will allow your student to graduate debt-free, it is definitely worth doing.
  3. Keep Looking – It this point during Spring of Senior year, you may think it is too late for your student to look at other colleges. This is not really the case. There are still schools accepting applications. Your student may find other schools that are willing to provide more need-based and/or merit-based aid. Here’s a great list of schools that still have upcoming application deadlines: 2020 College Application Deadlines. Also, after May 1, National Decision Day, colleges that don’t have all their open spots filled will publish that they are still accepting applications along with whether or not they still have financial aid to award and whether or not they still have on-campus housing available. It’s usually easy to find this listing of colleges online.
  4. Community College – If you are really worried about how you will pay for four years of college, consider saving a ton of money for the first two years of college if your student would start at community college and transfer to a 4-year school for the last two years. Community colleges have rolling admission so it’s never too late to apply. Of course this could mean turning down some great admissions offers, but less financial burden could make it worth doing.
  5. Gap Year – Has your student considered a gap year to allow time to save more money for college and reassess options? Some colleges will allow a student to defer their admissions offer for a year.
  6. PLUS Loan or Private Student Loans – I look at these as a last resort. If you can’t pay the expected family contribution, there are options for taking out loans to cover this amount. I believe this can have dangerous long-term consequences for both you and your student when it comes to paying off the accumulation of 4 years of student loans. One of the best guidelines is not to take out a total amount that surpasses the estimated yearly starting salary in your student’s planned profession. If your student doesn’t know what they want to do yet, I’d go with the recent overall average college graduate starting salary of $50,000 per year, meaning don’t take out a total 4-year loan amount over $50,000. A $50,000 total loan divided out between four years of college only provides a $12,500 loan per year. Even that amount is going to require a huge sacrifice to pay back when you figure in all the compounded interest.

So what if you aren’t that far yet? What if you are still in the college search process?

Hopefully you have started running Net Price Calculators on college websites. These will tell you what to expect your expected family contribution to be at each school. It’s usually a fairly good estimation.

If you haven’t done that yet, I recommend using the strategy I outline in the post, “Will We Qualify for Need-Based Financial Aid?” for estimating your student’s potential need-based financial aid.

Options When Your Student is Still in the College Search Process

My Upside Down College Search process will help you identify the best ways to save money on a college education. You can register here for the next free 1-hour LIVE online training that walks you through the process.

In general, you should focus on the following options when you have a very high expected family contribution:

  • Colleges that offer the most merit-based aidmeritscholarshiplist.com can help you quickly identify the schools that will offer your student the most merit-based aid.
  • Colleges with the lowest “sticker” prices – These will mostly be in-state public colleges, but could also include out-of-state public colleges that have reciprocity agreements with your state.
  • Community colleges with guaranteed transfer programs – These will allow you to save a lot of money on the first two years of college and will allow your student to transfer into a four-year program for the last two years.

Additionally, you may be able to lower your family’s expected family contribution through some smart money moves to reduce your adjusted gross income. Consult with a financial adviser to determine if any of these are right for you.

As described above, there are definitely options to lower the total cost of college . Your student may have to make some sacrifices as to the type of college they attend, but graduating with little to no debt will make this a worthwhile sacrifice. Use net price calculators to estimate your expected family contribution early in the college search process and focus on the schools with the lowest out-of-pocket estimates.