Need help from old hands understanding fin.aid

<p>Hey there - at the risk of being the dumb as a post nominee in the parents forum, I am throwing myself at ya'lls feet. I just don't understand the financial aid world. I have read everything written, but I'm obtuse.
The rubber is now hitting the road as I sit down to do the CSS profile, and I guess what I keep coming up with is what difference does it matter where you apply if you can't afford your EFC? I mean it seems like the system is set such that everyplace pretty much costs the same, if you can get your need met. So assuming (I know it's a big assumption, but we're hoping) that need is met at schools where S is accepted. So what? I still can't come up with the full EFC. So -- I smartly have thought to myself all these years, "that's OK - he's a smart kiddo, he'll get some scholarships" and he does - but then the colleges say that these are taken off the work study part of the package. How can I find the places that will allow outside scholarships to be applied to EFC?
When ya'll talk about merit on this board - say a 1/3 tuition scholarship from an individual school, then does the EFC remain the same?
I'm so confused! The EFC can't be the bottom line, no matter what, or else surely there would be fewer kids in college! Can anyone give me the third grade level lesson on this?
----and yes, I get US news premium, have read cur's posts, and everything on, this board, and a couple of other places ---- I'm either overwhelmed, LD with regard to $$$ matters, or both - actually I'm quite sure it's both - but any help is appreciated!</p>

<p>If you can't afford the full EFC, you may have to look at other options such as having your son live at home and go to school locally even if that means spending his first 2 years at a community college and then transferring and taking out more loans per year than he might have been comfortable doing if he were having to take out loans for 4 years.</p>

<p>Northstarmom is correct. Also, look to instate public school options. Also, you ask:
"When ya'll talk about merit on this board - say a 1/3 tuition scholarship from an individual school, then does the EFC remain the same?"</p>

<p>My son ruled out a school for this very reason. He received a 1/3 tuition scholarship (amounted to 10,000 off the sticker price of 40,000+ with room and board-more like 43,000 with everything). It was too expensive for us. They actually expected our efc+ they felt our son should come up with around an additional 4,000 (not included in the "expected family contribution#"). I don't have a problem with my son contributing to his education, but his #s and our #s were way too steep for us. We did not get another dime, besides the merit awards at most schools, BTW. My son is at an oos public university in VA. It costs us less than most of the private school would have cost our family (one private came in costing the same, and another was a little bit less than the oos public option).</p>

<p>Good luck. It is not about what you think you can pay. It is about what the schools and the government thinks you can afford to cough up for college.</p>

<p>ojr, it looks like you are understanding this process very well.</p>

<p>I think it bears repeating that the EFC does NOT assume you will be paying the bill out of current income, but either out of past savings (investments, etc.) or out of future savings in discounted dollars (loans, mortgages, etc.)</p>

<p>Mini is correct, and those will be family choices that will need to be made. Many on cc will tell you that they made those choices years ago. They chose to save for college, and they chose not to go into debt.</p>

<p>^Exactly. Our EFC this year is about 40% of our last year's income--which it was based on, and more than half of this year's income. We are paying it with savings, not just current income. (Even a super-thrift like me would probably not be able to survive on what was left otherwise!)</p>

<p>I hadn't heard what Mini said, but it sounds right. </p>

<p>What I'm getting about the EFC is YES, they expect you, the parent, to pay it. Their bit is the gap between the EFC and the total bill; you are responsible for the EFC. If the college really really really wants the kid, they offer money above and beyond the EFC. But that doesn't happen all that often. </p>

<p>Of course the EFC is wildly beyond what most families can comfortably pay. I think it's even more shocking if your child has always been in public school and you've never had to pay for private or parochial school. Then that EFC number seems even more overwhelming. </p>

<p>Often parents take out a loan for the EFC--that's why when you go to the bank, they have brochures about different types of college loans.</p>

<p>our daughter attended a school that met 100% of EFC- with grants- subsidized loans and workstudy
We were * not* able to come up with EFC out of current income and savings.
She * was * able to contribute about $3,000 to $4,000 each year to her EFC from her summer earnings.
I think this is assumed at some schools and is part of EFC.
Our EFC was about the same price as instate tuition and room and board
Which was frankly a shock, because it took a while to understand that we weren't expected to cover it from income.
There are schools, even schools who profess to only cover need based aid, that will tweak your EFC, if they really want you and come up with the money. Or schools that have really deep pockets and will fund merit aid.
Many of the womens colleges have reputations for really good aid- I have learned 2nd hand.
It does take a lot of legwork to find them though ( and to stay away from the schools that are notorious for poor aid, or for slashing it after freshman year::::cough:::::: NYU:::::::cough::::)
Now people will tell you that they didn't have that experience with this or that school- but there are some threads I think on finding schools with great merit aid</p>

<p>"She was able to contribute about $3,000 to $4,000 each year to her EFC from her summer earnings.
I think this is assumed at some schools and is part of EFC."</p>

<p>This is true too. It is assumed that the student will take on some responsibility for their education. I had a problem with one private that I mentioned in a post above, because they established an EFC, and then added on another 4,000. That was just way over the top. In my mind "expected family contribution", means "family" (parents + student).</p>

<p>Thanks all. Yes, we have some college savings, and anticipate S both working and taking out loans - however that seems to be factored in all ready by the colleges. We are not extravagant livers and could not afford private school for elementary or secondary. We do all those things the frugal posters talk about -- no car payments, camping for vacation, eat at home, yada yada. We have been expecting to pay out of pocket about 12k per year for college, the rest (hopefully) made up with work study, gift aid, scholarship, and loan. We can still pull that off to a degree, but the EFC calculators are coming up with 17 - 18K. So ---- does S really give up on what he thinks of as "normal" college? And why in the world would a kid knock their socks off in scholarship search and applications if the schools just take away their own aid if the kid gets something else??? Am I misunderstanding that?</p>

<p>You're not misunderstanding at all. Welcome to the middle class squeeze. I think many of us don't have a clue about this until our kids get very close to college age. I could sware article after article used to say a deserving kid could go to any college. Now I'm much more aware of the articles talking about why middle class kids go to state schools and threads about merit aid.</p>

<p>The bottom line seems to be that unless a kid is HYP exceptional, to get merit aid the kid will end up at a school he didn't used to dream of. Hopefully we can readjust the dream.</p>

<p>I also think parents need to think very hard before stretching and especially before taking out big loans. I've been following threads here where the kids leave the expensive college the second or third year because all they money no longer seems reasonable or is not doable.</p>

<p>In a good scenario your 40K school gives your student 10 K merit aid, your child takes 5-6 K loans, pays from her own earnings/ savings another 4-5K, you take 10 K in loans/second morgage etc and pay 10 K from your current income. EFC is your ability to shoulder debt, not what you can pay from your current income as above posters mention.
If you at that level of middle income when you do not qualify for need based aid but not able to pay schools COA- most of such kids end up going to state school for that very same reason. Here in IL even if state flagship cost 22K , other state schools cost less and there are some nice programs there like honors and such where your kid could get really great benefits.
Now if your kid has excellent stats, you can start your college search with main criteria in mind- which school will be VERY interested in my child, has good reputation for being generous and gives more grants than loans. This is something to discuss with your kid.
Typically child has to be in top 10-25% of applicants pool by stats and have some other attractive criteria/ URM, geographic diversity, EC skills etc./ to be seen at such school as very desirable candidate.
Your EFC will be different from CSS and FAFSA most likely, but not nesessary.</p>

<p>I will also add that the EFC calculators are not exact
the actual FAFSA may come up with numbers that are slightly different
Also the PROFILE may also come up with addtional expenses ( or assets) that they consider</p>

<p>"I also think parents need to think very hard before stretching and especially before taking out big loans. I've been following threads here where the kids leave the expensive college the second or third year because all they money no longer seems reasonable or is not doable."</p>

<p>Great message!</p>

<p>BTW, my kid did get merit aid at some match schools.</p>

<p>As to why a kid would want merit aid, if that is not taken off the efc?-EFC is comprised of loans (it can be ALL loans, if you get a bad package), Work study, and grants. To minimize those loans/work study you want the merit aid.</p>

<p>"You're not misunderstanding at all. Welcome to the middle class squeeze."</p>

<p>And congratulations on having it to squeeze. With the median family income in the U.S. being just above $50k, most "middle class" folks don't have it to squeeze. </p>

<p>"We have been expecting to pay out of pocket about 12k per year for college, the rest (hopefully) made up with work study, gift aid, scholarship, and loan. We can still pull that off to a degree, but the EFC calculators are coming up with 17 - 18K. So ---- does S really give up on what he thinks of as "normal" college?"</p>

<p>So I still don't see the problem. You say you can pay $12k a year out of current income, and that the colleges are expecting you to come up with $5k-$6k per year out of past savings or future ones (in discounted dollars). This (to me) doesn't sound like a bad situation at all. Am I missing something?</p>

<p>The 12k is current income and college savings.
Maybe I'm just hyperventilating. Let me breathe a minute with all of ya'lls good advice....
OK - most of the schools where S is interested, his stats, etc. look like he may be get 10 - 12K "merit". Then with the EFC of 18K (est.) which already includes summer employment = 28 - 30K, however our "need" = 22K, therefore there is 10k left - right? so that would be work study and student loan - right? And how we come up with the 16K portion of the EFC (other 2k - summer employment of student) is up to us.
But that would mean student loans of almost 20K per year WITH the merit scholarship and us coming up with our end somehow. Is this correct?</p>

<p>How do I tell which schools will ADD their merit scholarships, rather than include it within need? Do I need to ask each individual fin aid office at each school?</p>

<p>Please set me straight if I've got this mixed up somehow.
And to the person who said count your blessings - believe me I DO! I grew up very poor (no running water, parents not finished HS) and am thrilled to be a college graduate and a public school employee. I got my education by working my butt off all through school and never having a cent. I am, however, uneasy with $$ matters due to my upbringing. It scares me.
My S is very aware that he is both lucky to have options, and blessed to have abilities! Thanks all for the help! (and just the conversation is helping me stop hyperventilating:)</p>

<p>I remember having exactly the same feelings. I completed the FAFSA and CSS and gasped. The EFC seems just unbelieveably high. The situation is considerably worse if you live in an expensive part of the country. Living in an expensive part of the country can mean a high salary with a high cost of living and not much left over to go to tuition. The FAFSA and CSS are not adjusted for living costs in different parts of the country. The situation for many families is even worse than the initial impression. Many colleges "gap" and do not meet the EFC. Grants can be minimal with a large amount of loans.</p>

<p>There are always options. One is to make big sacrifices to pay the costs of attendance. That is basically the course I am on with the result that retirement will be greatly deferred and when I retire the budget will be tight. In effect the kids will get their inheritance early. Another option - at least for us - would have been State U's. My D could have gone with all expenses paid and even without the merit scholarships, costs would have been minimal. Another choice is often to look for private schools with good merit scholarships. Usually this means a very capable student going to a school with the majority of students at a much lower level. Looking beyond prestige and finding a school with a good fit can make this choice attractive. Some kids do well as the big fish in a small pond. Others settle into mediocrity. There is no correct choice. It depends on the individual kid, what the parents are willing or able to pay for, and the choices and acceptances that finally result from the whole process.</p>


<p>thanks so much for asking your questions..........i had many of the same questions during the last year. there's alot of info. available here on cc.......... and it's very helpful in making sense of the whole FA process. there are some fabulous regular posters around here who are very helpful and know the ropes. not too long ago, someone else linked this article which i'm linking below:</p>

<p><a href=""&gt;;/a&gt;&lt;/p>

<p>what we found is that it seems to be expected that generally students will apply to 8 to 10 schools and then compare financial aid packages. in your case...........your s may have to consider applying to more. our experience was that all packages were different........some included more $$$$'s in loans in order to meet our "need" you have to take a close look at the make-up of the package that is offered. you also have to have a clear picture of the Total Cost of Attendance for each particular school...........tuition, books, required fees, room, and board, etc. This will vary from school to school and may require you to do some inquiries to pull the numbers together completely. bottom line is then......... as you look at the financial aid packages............what is your out of pocket expense including your efc and what the student is expected to contribute as well. </p>

<p>there is one of the sites.........maybe princeton review..........where it tells what types of methodology are used by the institution. if i remember correctly, baylor, for example, only uses the FAFSA. </p>

<p>hang in there...........keep asking questions:)</p>

<p>Just to add a bit more confusion, be sure when you compare packages after your child has been accepted, you ask about how the packages are expected to be for all 4 years your child will be attending. At some schools, the package starts out with significant grants & the grant changes to loans the longer the student remains at the U.</p>

<p>If your child will be getting merit awards, find out what the terms for having merit awards renewed are & how difficult/easy it is for students to meet the terms (at some schools, many kids lose their merit awards because of inability to maintain sufficient GPA--good to know going in).</p>

<p>You also need to factor in school inflation. Figure 6% a year, so that the final year will have a list price some 25% more than it is now. Merit scholarships are usually a set amount, so they will not keep pace with inflation.</p>

<p>My experience with schools all within the Consortium on Financing of Higher Education (COHFE) - Ivies, prestige LACs, etc, and all using similar methodologies, and all guaranteeing "100 of need" etc. - is that the differences among awards, both in grant vs. loan and in total amounts, based on the same simple FASFA (no expensive homes, no investment income, no farms, no large medical expenses, etc. - were astonishingly large.</p>