Focus on Financial Aid: An Introduction

The unsettling news is that a year at most colleges, especially if living costs are included, starts at about $8,000 and can exceed $40,000. The good news is that if you need financial aid to help meet college costs, you are likely to receive it. So, this advice is worth remembering: cost should never be a deterrent in choosing the colleges to which you will apply.

There are no guarantees, of course, but there is a staggering amount of federal, state, institutional, and local financial aid available every year. The fact is, most of the students who apply for aid and who need it do receive all or part of what they need to attend their first-choice college. And the likelihood of receiving aid becomes greater as the cost of the college increases. The most expensive schools often have the most aid to give. During the application process, it is only good common sense to pick colleges with a range of costs, including some that are within your reach financially, but you should never eliminate the college you really want on grounds of cost alone.
 
Another point to keep in mind: the admission decision and the financial aid decision are made separately and independently of each other, usually in different offices on the campus. The admission decision comes first and it usually makes no difference whether or not you are a candidate for financial aid.

It is only after you are admitted that the financial aid staff will review your aid application and make its own aid decision. A favorable admission decision will not guarantee you financial aid, and your status as an aid candidate rarely jeopardizes your chances for admission. But, at colleges with limited resources, the most qualified applicants generally get the scholarship aid awards first. Therefore, if you are applying for financial aid, keep your grades up!
 
The kind of financial aid we’re discussing here is the specified amount of money that is offered to a student to help handle educational expenses. Most financial aid is given because the student has demonstrated need for it, and the amount of that aid is limited to the student’s calculated need. Simply stated, a student’s need is determined as the difference between the cost of attending the school, sometimes referred to as the cost of attendance, or COA, and the amount the student and his or her family is expected to pay, also known as the Expected Family Contribution (EFC).
 
COA - EFC = Student Need

The Expected Family Contribution is made up of:

• the amount the student's parents can pay from their income and assets;
• the amount the student can contribute from earnings, plus savings account(s); and
• any amount that is being contributed as a non-repayable gift from any source.

The student and parents are responsible for paying what they can; financial aid is intended to supplement such efforts, not substitute for them.

In fact, financing a higher education can be thought of as a partnership among the family, the federal and state governments, and the college or university.