Financial Aid Basics
Simply put, financial aid is money awarded to students to help them, and their families, pay for college. It can come from federal and state governments, colleges, universities, and private sources.The components of financial aid include Scholarships and Grants, Loans, and Work-Study. Keep in mind that not every student gets all three of these awards. This is determined by an individual’s eligibility. Who should apply? Anyone who thinks they might qualify or require financial aid at some point during their child’s undergraduate career. It is important to note that some colleges will not consider a request for institutional aid if the student neglects to submit the necessary forms when they apply as a freshman or transfer student.
The Cost of Attendance (COA), also known as a budget, is a combination of direct and indirect costs determined by colleges to show the amount of money a student might spend in order to live and study at an institution for a 9-month academic year.
Direct costs include tuition and fees that are paid directly to the institution and can be found on the student bill. Generally,the Tuition & Fees will be the same for all students unless a student is enrolled in a specific program. These fees may cover the cost of having a car on campus, parking permits, computers, art supplies, etc. Room & Board represents the average cost of a dorm room with a meal plan. The Free Application for Federal Aid, otherwise known as the FAFSA , includes a question about where a student plans to live. If you choose the fancy dorm room and gourmet meal plan this will not increase your financial aid award.
Indirect Costs are determined by each institution and are based on an average cost of attending a particular school. While these costs are not paid directly to the college, they must be considered when figuring out the true cost of attendance. These costs include: Books & Supplies (can be more for art supplies, lab fees, etc.),Transportation (varies greatly from school to school) and Personal Expenses (laundry, toiletries, and as my grandmother used to say, “pin money”).
In order to determine what your family will pay for a particular college you will need to use the institution’s Net Price Calculator (NPC). NPCs, which can be found on individual college websites, are designed to provide families with a basic idea of how much they might pay for a degree at a particular institution. Unfortunately, not all NPCs are created equal. Some can be quite challenging to locate. While required by law, these calculators do not always offer enough transparency and are not always based on the most up-to-date data. Nevertheless, they can be helpful when making college cost comparisons.They are a good place to begin.
If you expect to receive any help from Uncle Sam you need to complete your FAFSA by the required deadline. According to the FAFSA website, “many states and colleges set priority deadlines by which you must submit the FAFSA form to be considered for the aid programs they administer. There is also a federal deadline each academic year.” My advice is that you fill it out early as federal funds are not limitless and tend to run out the longer you wait. This year the “new better” (their words, not mine) FAFSA opens December 2023. Next year it will return to its usual October 1st opening. Unfortunately, the new FAFSA contains the same number of questions, but at least it will be more interactive and fun, kind of like tax returns.
All students must create a Federal Student Aid government account. Both students and their “contributor” (no longer called “parent”) will need their own FSA I.D. and password regardless of who establishes the application. There is no obligation to actually contribute if you fill out as “contributor” on a student’s form. The student is also considered a “contributor”. A student must be a United States citizen or eligible noncitizen to be eligible for federal student aid.
Hot Tip: I strongly suggest that you record your FSA I.D.s and passwords in a safe place as the experience borders on torture when one loses it. The purpose of the FAFSA is to determine each student’s Expected Family Contribution (EFC).The student and/or family fills out a form that gathers information from both the student and parent which includes income and assets. Home equity value (house where you live) and retirement funds such as 401K’s & IRA’s (Roth & Traditional) are two assets not considered in the FAFSA formula. The EFC is the minimum amount of money that the federal government expects the family to contribute to the student’s college expenses. Beginning in 2024-2025 the EFC will be called the Student Aid Index (SAI). Once your FAFSA is processed you will receive an email that contains your Student Aid Report (SAR).
In order to receive institutional “need-based” aid from a private college, you will most likely need to fill out the CSS Profile. The CSS Profile is somewhat similar to the FAFSA but a bit more intrusive and time consuming. Some private institutions will require that you complete an application they have created to replace the CSS Profile. Unlike the FAFSA, each biological parent and stepparent is listed on the CSS Profile. If parents are separated or divorced, the noncustodial parent will receive a link to create their own CSS Profile. I recommend that the student or parent login to the CSS Profile using the student’s College Board account.
While all of this may seem daunting, it is actually a lot better than it used to be so count your blessings. Should you need further assistance when filing for financial aid, you can call the following helpline phone numbers: 1-800-433-3243 (FAFSA) and 1-844-202-0524 (CSS Profile). The people on the other end of the phone line are very helpful!
Robin Haas is an Independent Educational Consultant and the Founder of Haas College Connections. She is a member of the Independent Educational Consultants Association (IECA), the Higher Education Consultants Association (HECA), the Western Association of College Admissions Counselors (WACAC) and earned a Certificate in College Counseling with Distinction from UCLA.
