25 Nov Understanding Financial Aid
Understanding what your financial aid package covers can be complicated. For students who have applied and been admitted to schools, you’ll receive an award letter from each college once your FAFSA is completed. An award letter will break down the overall cost of attending the school. That includes your family’s expected contribution and the financial aid you can expect to receive from that college. At this point, the cost of your college may be fully covered, but in some cases there could be a remaining financial need.
The Bottom Line
Every school addresses the cost of attendance and financial aid in its own. Some financial aid is completely free—grants, scholarships, or other awards which do not need to be repaid upon completion of your education. Once you subtract those fro the cost of attendance that is your true unmet financial need. When comparing similar schools and making a final decision on where to accept attendance, unmet financial need should be the barometer to use. Understanding financial aid and the overall out of pocket costs to you and your family should play a role in determining on the college of your future. If it is negligible between schools then it should not impact a student’s decision.
Filling the Gap
There are three main ways to fund the unmet financial need gap:
- Grants and scholarships—schools may provide more opportunities for new students to receive grants and scholarships than they do for returning students. It’s a way for a college to entice new students to join their ranks over a competitor’s. Keep in mind, these awards may change yearly and so will your unmet financial need.
- Loans—subsidized and unsubsidized loans will be made available to you and your family. There is no obligation to accept these offers. In some cases you should. And in others you shouldn’t. Talk with one of your expert counselors to determine what is best for your family. Each type of loan has different terms and depending on your situation one will be better than another.
- Federal Work Study—students may be eligible to earn an award through on-campus work. If you are interested, contact your school’s Financial Aid Office to discuss options.