Paying

There's no denying that college is expensive. The average cost (tuition and fees) of a four-year public college or university is $6,185 and $16,332 at a four-year private college or university. One year at Harvard costs more than $46,000. But higher education may be more affordable than you think.

The family's financial strength is dependent upon a combination of factors such as assets, liabilities, family size, age of parents, medical expenses, and number of children in college. Parents and students are responsible to help pay for college costs. If the costs cannot be met, then the student has the opportunity to apply for financial aid. All students should apply for financial aid even if they think they do not qualify.

About 56 percent of students enrolled at four-year colleges attend institutions that charge tuition and fees of less than $9,000 per year.
43 percent of full-time students enrolled in public four-year colleges attend institutions that charge tuition and fees between $3,000 and $6,000.
Only about 6 percent of all students attend colleges with tuition and fees totaling $33,000 or higher per year.

About two-thirds of all full-time undergraduate students receive grant aid. In 2007-08, estimated aid in the form of grants and tax benefits averaged about $2,040 per student at public two-year colleges, about $3,600 at public four-year colleges, and about $9,300 per student at private four-year colleges.

For full-time dependent students at public two-year colleges, net tuition and fees are no more than 2% of the family income.

Don't rule out any school just because it seems too expensive. Many private colleges have a great deal of money to award and great flexibility in the ways they award it. As a result, you might receive a financial aid package from an expensive school that will actually make it less expensive to attend than a school with a lower cost of attendance.

Many people will gladly finance a car, a house, furniture, a trip, or a boat, but what better investment could one find than a college education for your teen? Save as much money as you can, but don't rule out taking a loan.

The cost of attendance (COA) is the cost of one year of college.
Every school calculates its COA every year and it appears on every financial aid letter.
                    The COA includes:
                        $ tuition and student fees
                            $ room and board
                                $ books and supplies
                                    $ personal expenses
                                        $ transportation
What you can contribute + the financial aid package + the unmet need = The Annual Cost of School

The bottom line is that colleges want to invest their money in students who have the potential to achieve not only their own goals but also the school's goals as well. The price you pay depends on the financial condition of your family and how much the college wants you.

The financial aid office at the college your teen plans to attend is the best place to begin your search for free information. The financial aid administrator can tell you about student aid available from your state, the school itself, and other sources.

The school is required to inform you of its aid procedures and deadlines, and how and when you'll receive your aid award. Be sure that you've read and understood each school's satisfactory academic progress policy and keep copies of your enrollment agreement, the school's catalog, and all financial aid documents (especially loan documents) you receive.

You can also find free information about federal, state, institutional, and private student aid in your local library's reference section (usually listed under "student aid" or "financial aid").

Student aid information may also be available from foundations, religious organizations, community organizations, and civic groups, as well as organizations related to your field of interest, such as the American Medical Association or American Bar Association. You can also check with your employers or unions to see if they award scholarships or have tuition payment plans.

Federal Student Aid Programs

To help you pay for college, the U.S. Department of Education offers a variety of student financial aid programs. These programs, described below, are administered by the U.S. Department of Education and provide over $33 billion a year to students attending post-secondary schools. Important Note: Not all schools participate in all federal student aid programs. Check with your high school counselor or the college's financial aid office to make sure it participates in the federal program(s) you are interested in.

Federal Pell Grants are available to undergraduate students only. Grants do not have to be repaid.

Federal Stafford Loans are student loans that must be repaid and are available to both undergraduate and graduate students. If the college participates in the William D. Ford Federal Direct Loan (Direct Loan) Program, the federal government provides the funds for your Stafford Loan. If the college participates in the Federal Family Education Loan (FFEL) Program, a private lender provides the funds for your Stafford Loan, although the federal government guarantees the loan funds. First-year undergraduates are eligible for loans up to $2,625. Amounts increase for subsequent years of study, with higher amounts for graduate students. The interest rate is variable, but never exceeds 8.25 percent. If your teen qualifies (based on need) for a subsidized Stafford loan, the government will pay the interest on your loan while he/she is in school, during grace periods, and during any deferment periods. You are responsible for paying all of the interest that accrues on an unsubsidized Stafford Loan.

Federal PLUS Loans are unsubsidized loans made to parents. If you cannot get a PLUS loan, your teen is eligible to borrow additional Stafford Loan funds. The interest rate is variable, but never exceeds 9 percent.

Campus-Based Programs are administered by participating schools. There are three of these programs.

Federal Supplemental Educational Opportunity Grants are grants available for undergraduates only; awards range from $100-$4,000.

Federal Work Study provides jobs to undergraduate and graduate students, allowing them to earn money to pay education expenses.

Perkins Loans are low-interest (5 percent) loans that must be repaid; the maximum annual loan amount is $4,000 for undergraduate students and $6,000 for graduate students.

Many educational institutions and programs are qualified to disburse federal student financial aid. They include:

Large universities

Small liberal arts colleges

Community colleges

Career and technical schools

Trade schools

Certification programs, degree and non-degree programs

The Department of Education assigns a Federal School Code number (previously called a Title IV School Code) to each school that is approved to participate in awarding Pell Grants and other federal financial aid.

The information you provide on your FAFSA also determines if you are eligible to receive federal aid.

After processing your FAFSA, the Department of Education mails your Student Aid Report (SAR) to you and sends a copy electronically to the schools you list on your FAFSA.

Schools use your SAR's Expected Family Contribution (EFC) number to determine if you will receive financial aid.

If you qualify, the school prepares a financial aid package to help you meet your financial need. Financial need is the difference between your school's cost of attendance (including living expenses), as calculated by your school, and your expected family contribution.

California Student Aid Commission

The California Student Aid Commission understands that the search for financial aid sources can sometimes be difficult. Many families and students are convinced that college is too expensive. Attending college does cost money, but there are many programs available that can help you obtain the money you need. Additionally, don't rule out higher cost schools until you have talked with the campus financial aid office; higher cost schools may provide a higher level of aid. Here are a few suggestions to help you in your search:
Internet Access: A great place to start your search for information on scholarships and grants is the Financial Aid Information Page. While visiting the site, make sure to use FastWeb's free scholarship search to find all of the awards for which you may qualify.

Libraries and Bookstores: These locations have books on the various sources of financial aid.

Loan Programs: Qualified students and their parents can borrow money for education through low-interest federally supported loans. the loans are made by banks, savings and loans, and credit unions and are guaranteed by the commission's subsidiary, EDFUND.

State Financial Aid: Administered by the California Student Aid Commission, State aid for the most part is, reserved for California resident students with financial need as determined by the information contained on their Free Application for Federal Student Aid (FAFSA). In addition, the well funded Cal Grant programs require academic qualification as derived from the Student Aid Commission Grade Point Average (GPA) Verification Form. Both the FAFSA and GPA Verification must be postmarked by March 2nd each year.

Click here for more information on Cal Grants and other Commission Programs.

Campus Based Financial Aid: Students should directly contact each college that they are considering, for specific information on applying for financial aid at that school. Each college will have programs available only to their students.

Private Scholarships: Hundreds of privately funded scholarships are available nationally to qualified students. Scholarships are considered gift aid, which does not have to be repaid, and are often awarded for merit in academics, athletics, or a particular field of study. Scholarships may also be awarded based on ethnic background, religious affiliation, and special interests.

Free Application For Federal Student Aid (FAFSA)To apply for federal student financial aid, and to apply for many state student aid programs, students must complete a Free Application for Federal Student Aid (FAFSA). The information you provide on your FAFSA determines if you are eligible for financial aid.

You should consider using FAFSA on the Web because:

FAFSA on the Web is faster than applying for aid by paper.

FAFSA on the Web uses skip logic based on your particular information, so you will need to answer fewer questions than on the paper application.

FAFSA on the Web checks your answers before you submit your application, so there is less chance your application will be rejected because of missing or conflicting information.

You can save application information so that it can be completed and transmitted at a later time.

FAFSA on the Web can be used on Windows or Macintosh computers, using the most popular Netscape and Microsoft browser versions.

FAFSA on the Web doesn't require software to be installed, so it takes less time before you can actually use the application.

You can access FAFSA on the Web from anywhere, including school or home, making it more convenient to complete the application.

FAFSA on the Web can support an unlimited number of users, allowing thousands of students to apply at once.

FAFSA opens the door to the federal aid process. Find out what you can expect by clicking here.

Questions To Ask The Financial Aid Office

College visits are one of the most important steps in the college selection process. When you visit the college with your teen, be sure to visit the financial aid office and ask questions. By asking these questions at each college in which your teen is interested, you will get a better idea of the ones that are financially feasible for your teen to attend.

1. What are your financial aid deadlines?
This soft opening question will reveal what forms you need to submit, to whom, and when. There may be both the usual ones, the FAFSA and PROFILE, plus the college's own forms. There may also be different forms for need-based and merit-based aid. It usually works out that the more forms they require the more money they have, but also the tighter they may be with it.

2. What is your cost of attendance (COA) for the current year?
If your teen is a junior, colleges won't have the numbers for his/her freshman college year until April or even June of the senior high school year, so you will have to estimate based on this year's numbers. There are precisely six components to a college student's complete budget:

                                        $ Tuition
                                        $ Fees
                                        $ Room and Board
                                        $ Books and Supplies
                                        $ Personal expenses
                                        $ Transportation

Many budgets you will see include only direct costs ( the first three items listed) and what you will pay directly to the bursar's office. However, the Department of Education requires colleges to fully inform you as to all of the above costs, so find out specifically what those amounts are.

3. How much of an increase in the cost of attendance (COA) do you project for next year?
When you ask for this, ask for the components separately. Tuition and room and board increases are independent of each other. For example, at one school they may expect an increase of 5 percent in tuition and fees, but a 10 percent increase in room and board. Asking detailed questions like this gives a good impression that you know what you are talking about.

4. Do you use your own institutional methodology to determine need?
If you ask this question, the financial aid officer will know that he/she is having a conversation with an educated parent. Your goal here is to sense how deeply the college will delve into your financial profile.

5. Are you able to meet 100 percent of financial need?
If they say "no," find out why, and get details. Is it "first come, first served"? What's the average percentage of need they can meet? What percentage is grants and what is loans? Do they have a dollar amount they leave as a gap (unmet need) for everyone?

6. In what order do you create the financial aid package?
When creating the package, do they first fill the aid package up with loans, or do they figure a grant for the student first? The answer to this question may tell you a few things. A financially strong school that knows they want your teen to attend will say "grants before self-help." But so will a college that understands good marketing -- they know that's what you want to hear. Most colleges will actually begin to build the financial package with student loans, no matter what they claim. You may learn more from how the answer is given, rather than what is said.

You should also ask if the financial aid office treats parent loans (PLUS Loans) as an option when figuring how the school will meet your need. If so, this usually means that the school simply doesn't have the money. Remember, PLUS loans are for helping with your expected family contribution (EFC) after the aid given is subtracted from the full cost of attendance.

An important fact to keep in mind is that the higher your teen is in the applicant pool, the greater the chance for more grant assistance. This is called "financial aid leveraging" in financial aid parlance. So you and your teen should apply to colleges where he/she will stand above the other applicants.

7. Do you offer merit scholarships and how do you treat private scholarships my teen may earn on his own?
If a merit scholarship is being awarded, it normally goes into the package first, reducing the amount of need-based aid. Find out if a merit award reduces the self-help in the package, or if it replaces other need-based grants. A true merit scholarship can go beyond the "need" level, which means that it can lower your EFC. If it doesn't go beyond your "need" level, then the college is being misleading by advertising a need-based award as non-need based. Or at least the award is limited by need, which in effect is the same thing as a need-based grant.

Note: The prestigious Ivy and "small ivies" (Wesleyan, Williams, etc.) do not offer merit scholarships. The scholarships and grants offered at these schools are based on their particular formulas determining need.