Improve Your Financial Aid Package:
Once the government calculates your family’s Expected Family Contribution (EFC), it will then be displayed on your Student Aid Report (SAR). And once the colleges receive their copy of your SAR, they may decide to do a verification (audit) of the financial information provided by your family. Verification is a simple process for families and if your financial aid application is selected for verification, the school will require you to submit additional documentation, such as signed copies of your IRS tax returns, W-2 and 1099 forms. The federal government selects 30% of the FAFSAs for verification. However, some public and private colleges will select as many as 100% of the FAFSAs for verification.
The Financial Aid Award Letter
Once the verification process is completed, each college will begin the process of issuing financial aid award letters to all deserving students. This includes many high income families whose students will attend high-priced private colleges. Private colleges often provide tuition discounts to reward good students from higher income families.
The family should compare the financial aid package from each college. Do not look just at the total amount of aid, but conduct a bottom-line analysis of the net out-of-pocket cost of attending each school. Different schools, for example, may have different costs for room and board.
Depending on the type of college (private vs. public), you can appeal your award letter after finding out what your financial aid package entails. Private schools have institutional grant money that can be negotiated, but state schools are funded by the state and have less flexibility. Unfortunately, even private college financial aid packages can fall short of what you anticipate. You may also receive an award from a second-choice school that is more generous than the one from your first-choice school. But a school’s first financial aid offer doesn’t have to be its last. Improving your aid award is possible.
If you are appealing an award package, you should be able to demonstrate that there is a legitimate need for additional aid. For example, you may have had a change in employment or an unusual family circumstance, since completing your initial financial aid application. Since May is the standard time to notify colleges of your decision, you’ll need to take some swift action.
Three Things That Must Be Done
As financial aid offers turn up in your mailbox, you must first do three things if you want to try for an improved aid package:
- Understand the Components – First, you have to fully grasp what each school is offering you. Although, the financial aid award letter varies in format from school to school, it should contain the following items:
- Your cost of college
- Your family’s expected financial contribution (EFC)
- Your family’s need (the cost of college minus your EFC)
- A listing of each aid source and dollar amount
- A date by which you must return the award letter
- Information on “appealing” any detail in the award letter
- Compare Packages – Next, compare your aid packages carefully. They can be as different as night and day. Consider the amount you have to pay out of your pocket now and how much you’ll eventually have to repay in the future. In other words, be wary of how much of the award is in the form of loans.
- Respond to the Award Letter – Don’t delay in responding to this award letter just because you’re still waiting to hear from other schools. If you don’t reply on time, the aid package can be revoked. Responding to an award letter does not commit you to attending the school(s); it merely safeguards your award. In responding, you have three choices – you can accept the award in its entirety, you can accept some components and reject others, or you can reject the offer entirely and request a revision in the composition of the package.
If you’ve decided to ask for additional aid, you will need to persuade the financial aid administrator (FAA) of the college. Be sure to contact the FAA as early as possible because the school’s extra discretionary aid runs out fast. Present your case in a well-thought-out and diplomatic manner. If you have a legitimate argument, you should support it with documentation.
Time is of the essence and an improper award letter appeal could cost you thousands of dollars. To learn more about how to appeal your award package the right way, please see Maximize Your Financial Aid Package: Let’s Make a Deal! I will personally help you develop an appeal strategy, prior to discussing your appeal with the FAA.