Thought to Consider

Today’s “Thought to Consider” is targeted at parents of sophomores and juniors. We are thinking about paying for college today because today, October 1st, is the day the FAFSA (Free Application for Federal Student Aid) opens for the class of 2021 to apply for need-based financial aid for their first year of college. Parents of sophomores and juniors, you still have a bit of time before you’ll need to apply for financial aid, but today is still a good time to start thinking about whether or not you’ll qualify for need-based aid. For many families, the cost of attendance is an important factor when making their final college decision. If that will be the case for you and your family, it might also be worth considering that factor at the beginning of the college search process.

It’s important to know that financial aid is not simply “yes, we qualify” or “no, we don’t”. While the FAFSA will tell you how much the federal government thinks you should be expected to pay for a year of college based on your family’s financial information (this is called your Expected Family Contribution or EFC), it does not guarantee that every college will offer you sufficient aid to bring your net price down to that same number. The difference between a college’s advertised cost of attendance and your family’s EFC is called your “demonstrated need” and colleges can decide how much of that demonstrated need they want to meet and how they want to meet it (with grants or with loans). We have seen the difference in financial aid offers from two colleges be as big as $25,000/year, meaning the school with the smaller aid offer could cost you as much as $100,000 more than the school with the bigger aid offer over 4 years. So if financial aid is important to your family, it can definitely pay to add the right colleges to your list.  

It’s too early in the process for sophomore and juniors to get too much into the weeds on this, but to start thinking about paying for college today, you can take 10 minutes to complete this net price calculator on the College Board’s website. It is free, easy, and anonymous and will give you a rough estimate of your family’s EFC. From there, your college counselor can help you identify colleges that are most likely to offer you an aid package that will bring your total cost in line with your family’s budget.

For more information on how financial aid works at colleges, here is a link to a presentation David Gelinas, the former Director of Financial Aid at Davidson College, gave to Lake Norman Area schools last month. The password to access that recording is i*R3V6d3.