What Determines How Much I Can Get?

A basic principle that exists among all college financial aid offices is that the student and/or his/her family is expected to pay “something.” What that “something” is, can be quite different from your interpretation. Not only can this amount differ between you and the school, but it might be different between the multiple schools to which you are applying! Each school has its own unique set of circumstances and characteristics (e.g. tuition, housing, lab fees, private vs. public, etc.) that affect a student’s financial aid eligibility and/or need (refer to our section titled How Much is This Going to Cost?). Really, only the Pell Grant is the one financial aid program that should not differ from school to school.

Because each school is unique, it stands to reason that each school’s financial aid package will be unique. Take for instance a private college where tuition, alone, is $10,000/year. It’s very possible that a prospective applicant to this school might get a number of loan offerings and an institutional scholarship. Private colleges realize their cost of attendance is much higher than a public university and have to actively engage in something called “tuition discounting” to bring their overall cost to a manageable/attractive amount. Tuition discounting, simply stated, is the practice of reducing a student’s cost of attendance by replacing a portion of their tuition with money provided by the institution or other outside entities (endowments, philanthropic groups, etc.). This practice is mentioned in reference to private colleges, because of their relative high cost. It also exists at public colleges and universities, too. In this example, the same student, who applies at a traditional four-year university where tuition is much cheaper, might not be offered anything but loans.

The point being, when it comes to constructing a student’s financial aid package (especially merit-based scholarships), the list of factors can be extremely long. Date of application, test scores, scholarship interview, religious affiliation, financial situation...you get the picture. All of these things could mean something different to every school you’re applying. Try to concentrate on the things you have control over...pay careful attention to deadlines, prepare well for SAT and ACT exams, be creative and unique in your scholarship essays. These things can and WILL make a difference.

But this section wouldn’t be complete if we didn’t talk about the single biggest factor in determining your financial aid eligibility: your Expected Family Contribution or EFC. Your EFC is the amount of money you and your family are expected to contribute toward your educational costs. It’s based on a number of factors including your family’s earnings, assets, savings, household size and number in college. But where does the EFC come from?...the Free Application for Federal Student Aid or FAFSA (pronounced FAF-suh). If you don’t learn anything else from this site, remember the terms FAFSA and EFC. They will be spoken to you time and time again as you interact with your college financial aid office.

As we just stated, the EFC comes from the FAFSA. Our section titled FAFSA – The Heart of the Financial aid Process goes into greater detail about what goes into completing the application. The FAFSA must be completed in order to be considered for most federal and some institutional aid programs. It’s a good idea for every prospective college student to complete the FAFSA in the January preceding their first term of enrollment. The 2006-2007 FAFSA is available online at www.fafsa.ed.gov or in paper form at most college financial aid offices and high school guidance offices. It should be used for terms or enrollment that run between July 1, 2006 and June 30, 2007. (If your first term of enrollment is a summer term, check with your school’s financial aid office to pick the correct year’s application).

The FAFSA is free and relatively simple to complete. You would be well-advised to have yours and your family’s 2005 federal tax returns done before you begin completing your FAFSA. It is not necessary as you are allowed to “estimate” information that is requested on the FAFSA. Just know, you will likely be asked to provide a copy of your completed tax return later. If there are substantial differences between what was originally reported and what the tax return shows, it will probably affect your EFC once the corrections are made.

Again, please refer to our section titled FAFSA – The Heart of the Financial Aid Process to get more detailed information.