Idk why average cost and aid is touted everywhere when it means literally nothing for any individual. If average cost is 50k, it may cost family A 0 dollars while it may cost family B 78k. What could be a more transparent and efficient way for news articles to educate families about costs?
I host college application workshops for our local community. Even your brief summation could be misleading bc that sort of scenario exists for less than 75 institutions. (those meeting need) and of those, it does not mean cost is $0. Most of those expect students to take out student loans and even the ones that don’t typically expect a student contribution from a summer job.
Educating parents on the FA process begins with generalities like understanding their FAFSA EFC (can’t tell you how many people think that it means how much they have to pay for any school), what the CSS Profile is, how to use NPC, requirements for providing NCP information, does the student qualify for merit scholarships (are they automatic or competitive), does the school allow stacking of aid or no stacking, how to understand familial contribution, etc.
Another conversation that often needs to be had is not to just look at the final number on the NPC or in their FA letter but to go back and add in all loans and work study numbers bc that number is their cost per yr. (And emphasize the per yr expected cost and that it is not fixed.)
There is no simple definition or easy way to talk about it. When it comes right down to it, unless the school offers nothing but loans and federal grants, the entire conversation has to be in either generalities or student specific.
This is how I compared school net costs.
The schools I looked at based their need based aid on the FAFSA EFC only and awarded merit aid based on stats.
They were all instate schools, so we could get a state grant at all of them.
I would run the net price calculator with our income and assets.
Then I would see how much need based institutional aid the school might give for our FAFSA EFC, how much merit and how much state grant.
I would look up the most recent tuition, fees, room and board costs for the school and for the academic program my student was applying for (often a school has different tuition rates/extra fees for engineering, nursing, other majors).
I would add up all direct costs like tuition, fees, room, board.
Then subtract all estimated aid (merit scholarships, institutional grant, state grant)
That is the (estimated) net cost or net price of that school.
Then that net price needs to be covered with parent contribution, student work earnings and student loan of $5,500.
I also ran the net price calculator for one or two students in college to see how institutional grant aid and net price would be affected.
I get what @CupCakeMuffins is saying. Average cost means nothing in & of itself. Fortunately, the internet allows students to be able to research aid policies at various schools, find out what they might be able to expect in terms of aid from various schools & find a safety school or two. There will still be students who do not have affordable options (particularly rural students). But published information does give students a starting point in their research.
It is a starting point. When I first started looking at schools with my kids, I had sticker shock and was ready to cross all the $20k+ schools off the list. Then I found out about different grants and merit awards available and those schools could stay on the lists. I guess what was helpful about ‘average’ awards or ‘average’ COA was that it made me look into how those families got the costs down to the ‘average.’ I was okay with being average if it saved me $40k.
Every student or parent isn’t well-equipped to understand these things. I feel high schools should have a mandatory course where financial aid, income tax, personal banking, health insurance and other things like that are taught to every student.
This!! Every graduating class. A functioning member of our society today needs understanding of all these things and more. A semester, trimester, quarter class would provide time to cover these. How to fill out a job application, how to interview for a job/scholarship, …
My kid took a personal finance course in college. He said it was one of the best courses he took. It gave him a LOT of real life information about…personal finances.
He also said it was information kids could benefit from in high school.
Mine had a personal finance class in high school (required). It was the teacher I liked least of all the teachers they ever had and I thought he did a very poor job. He didn’t explain check books or credit cards or interest. They did a big project where they had to have a budget and buy groceries and a car and car and health insurance. He was more concerned that my D had planned to have eggs for dinner. He couldn’t believe anyone could eat eggs for dinner.
At a different school my D attended (but not as a hs senior) all the seniors had to apply to 3 colleges, for 3 scholarships and for 3 grants. Everyone had to do it even if they weren’t going to college.
“Average cost” and “average aid” can be soooo misleading that I wish those metrics weren’t mentioned.
A few college FA webpages would feature a few students’ scenarios to give an idea of how their aid worked out. Each scenario would list a few student facts: home state, ACT/SAT score, GPA, family income, assets/savings. It was an easy way to get a quick rough idea of what to expect for aid and merit without having to run the NPC.
For example: home state: FL, ACT 32/SAT 1460, GPA 3.9, family income $100k. School A cost of attendance is $25k. The result might include: Bright Futures for qualified FL residents: $6000, $3000 merit scholarship for ACT/SAT&GPA, $5500 loan, $2000 work study. $16,500 in aid and family’s out of pocket is less than $9k. Then there might be a mention that the parents either took out a Parent Plus loan or used the monthly payment plan to pay the balance.
The problem is that certain scenarios can have such depressing results that schools probably don’t want to feature them. An OOS student from a low income family with average stats might be shown a COA of $45k with only a $6000 Pell Grant and $5500 student loan. Remaining costs would show that low-income family’s OOP is over $30k.
That said, these sample scenarios were a nice, quick and easy way to see if certain schools should even be on one’s list.
There is a route I fly frequently for work. According to the major “discount” websites, the average cost of a ticket to this destination from my area is $239 (give or take). I don’t think I’ve ever paid less than $499 and sometimes MUCH higher. Yes- if I were willing to fly Friday evening, have two stop-overs, and arrive Saturday mid-morning, I could pay $199 (so I’m sure that the arithmetic works in terms of the “average”.) But these stats don’t apply to me- I am traveling on business, don’t want to show up Saturday morning for a Monday afternoon meeting, and am certainly not switching planes twice when I don’t need to.
So I pay $545 or so, most of the time. I’m not sure who thinks that the “average cost” applies to them, but it’s really not too hard to plug in your own numbers and see something closer to the truth.
There’s a lot of naive students and parents who see “average cost” and think it applies to them. Lots of shallow thinking going on…never considering that some aid might be merit based…and never considering that incomes can vary from 0 to millions.
Heck, we even had a kid post here whose family (parents and he) believed that they would get that “average aid” that they heard at a talk at a Claremont college. The talk also said something like, 93% of our students get aid. Never did they consider that their $375k income would mean no aid at all. They were gobsmacked.
It’s pretty much like those news headlines with whiz kids getting millions in scholarships. Average reader doesn’t know, most of it is need based aid and hypothetical as one person is only eligible for aid at the college, he’ll attend. No one is that smart for multiple colleges to throw millions of merit aid at them, specially selective colleges.
I’ve heard from one of my kid’s friend that his parents were telling him to be like the kid in the paper, in reality this kid is many times a high achiever than kid in the news but parents not in the same income bracket as family in the news.