The college selection and the award letter comparison is one of the most important decisions you will make as a parent or as a student. Understanding the financial details of the financial aid award letter is critical.
Trying to prioritize the colleges can become more difficult when the number of applications is large. Parents need to understand their award numbers from each school which at times can be difficult since each school has its own format. Review and compare the cost of attendance of each school versus the personal numbers. Separating the gift aid from the need based aid is important. If you sum tuition, room and board, then subtract the gift aid; the result will be the parent’s true out of pocket cost paid to the college. Other cost like books are paid to another source.
The current problem with comparing the award letters from each college is that schools only provide one-year of information. This gives families a limited view of the college cost for their child. It makes college planning and budgeting more difficult. Taking a four-year approach has several advantages such as allowing the family to evaluate the possible changes in their EFC projection. The EFC number could go up or down based on other siblings in the family. Seeing the award letter projected out four-years will help families develop their budget and cash flow.
This financial aid award letter video will cover:
- Advantages of four-year analysis
- Changes in aid
- Cash flow over four-years and EFC changes
Remember when you compare your award letter make sure that you really understand the difference and criteria between the need and merit scholarship. A need based scholarship is based on financial needs and your EFC each year. If your financial award contains more need aid there is a high probability that it may change year to year.