A well-respected friend (and parent of a HS senior) requested more information on ‘Paying for College.’ I was surprised to see how little I’d written about this; I’ve written about the value, but not much on how to pay.
Here are a few places to start. I’m writing this for parents; it’s hard for me to imagine asking a teenager to decipher the financial aid puzzle.
1. Complete the FAFSA. It all starts with FAFSA, the Free Application for Federal Student Aid. Key word here is free. (Be sure to go to FAFSA.gov, the Federal site, and not FAFSA.com, which charges for consulting help in completing the free application.) Register for a PIN and keep that in a safe place; you’ll use the same one all four years (and for graduate school). Many guides are available online or in print. (One worth looking at is Paying for College without Going Broke; the 2012 version will tie in with the 2012 FAFSA.)
Two specific pieces of advice I’ve seen:
- Complete the FAFSA whether or not you think your family will qualify for need-based aid; it is often used to determine merit-based awards as well.
- Complete it as soon as possible after January 1. Colleges will provide a deadline, but a lot of the funds are first-come, first-served, so the earlier the application is submitted the better. The screenshot shows a series of tweets on this from Russell Golowin, of College Funding Relief, LLC. (Thanks to Smart College Visit for hosting the weekly #CampusChat.)
From the FAFSA, the Federal government will determine your family’s Expected Family Contribution, or EFC. Each college uses the EFC to determine the aid they will offer to your student. My understanding from reading about it and talking to other parents: the Expected Family Contribution is typically far higher than any family feels they can contribute. (And, perhaps, want to contribute.)
2. Complete the CSS Profile. Or, for the official name: the CSS/Financial Aid PROFILE®. The CSS [College Scholarship Service] Profile is a financial aid application service offered by the College Board. The Profile is required by most private colleges, costs a flat fee for submission (last year, $9) and a fee per each college it is sent to (last year, $16). The online app for 2012-13 should be available October 1, 2011.
The Profile also calculates the EFC, but uses a different methodology. Here’s a brief outline from Peterson’s College Search:
Comparing the CSS Profile with the FAFSA:
- In measuring your family’s ability to pay for college, the PROFILE uses the Institutional Methodology (IM) instead of the Federal Methodology (FM), which is used on the FAFSA. Although the two systems are fundamentally the same—in both the IM and FM, the primary “drivers” that determine how much you will be expected to pay for college are income, assets, family size, and the number of children in college—the IM takes into account whether your family owns a home and assumes a minimum student contribution.
- The PROFILE contains questions specific to the schools you’re applying to, while the FAFSA is a standardized financial aid application designed to be used in conjunction with federal aid.
- The PROFILE allows financial aid counselors to take special circumstances into greater consideration.
3. Determine Costs. How to compare college costs should be easier this year than in previous years, as the Department of Education will require colleges to post a net price calculator no later than October 2011. Here’s more information on the requirement. See these tips, from Lynn O’Shaugnessy at The College Solution, on how to use the calculators correctly.
These so-called net price calculators will be incredibly valuable because they will allow students and their parents to learn in advance what the price of individual colleges will be for them. As I mentioned in a recent blog post, these net price calculators will determine the price for a family after any grants are subtracted from the sticker price.
These calculators, which must be installed by late October, aren’t going to be perfect. You will increase your chances of using them effectively, however, if you understand some of the issues facing users and the colleges that are creating the calculators.
Lynn also writes that side-by-side comparisons will be difficult. At best, this is a start.
Please note that in Virginia, we also have access to the VA Education Wizard, which helps calculate and compare costs for Virginia Community Colleges against four-year colleges, including the complete cost of a Bachelor’s Degree.
As I understand the entire Paying for College process, these three steps are necessary for every family. I’ll write about researching funding sources soon.
- 10 Schools Where Merit Aid Awards Are Most Common (usnews.com)
- Your retirement savings are not included in determining EFC (costofcollege.wordpress.com)