Understanding college financial aid packages

CHICOPEE, Mass. (Mass Appeal) – When a college offers you financial aid, it’s important to understand exactly what it is offering you-especially before you sign on the proverbial dotted line. College expert Paul Hemphill shared important information every parent needs to know.

What is a financial aid package and what should parents look for to understand what they are being offered?
A financial aid package is what the college is giving you to make it possible for your child to attend their college. The amount is based on the information you filled out on the FAFSA form, which is the form every parent fills out to apply for federal student aid. Once the letter arrives telling you what you have received in financial aid, look for a vile, terrible and disgusting 4-letter word in the letter – can I say this on TV?! – LOAN! Believe it or not, colleges want you to feel warm and fuzzy with all the loans they will put into the package and have the audacity to tell you it’s an “award!”

What else should a parent expect to see that might look a little suspicious?
Look for the term, “work-study.” It means that the school is “giving” you a work study of, say, $3,000 a year. when in fact they cannot guarantee you will get the work-study. They will not hand you a piece of paper telling you what building to go to in order to find your job. A job on campus is available on a first-come, first-served basis, but the financial aid package doesn’t have an asterisk telling you this. If I were the student, I would decline the work-study feature of the financial aid package and show up at the school catering office when you arrive on campus. Chances are excellent you’ll get the job.

Can parents increase their financial aid package if they don’t like the amount being offered?
Yes. If you have extenuating circumstances like a recent loss of job or death of a family wage earner, that’s the time to notify a college and they will increase your financial aid. But if you have no extenuating circumstances, my favorite tactic is to start a bidding war between the colleges who have offered more money than the college your child wants to attend. Of course, that assumes your child applied to at least 10 colleges who are all in the same league – who regard each other as honest competitors. A college accepted your child because it was a good business decision, and they don’t want to lose you.

How do you make that bidding war work so the colleges take you seriously?
First and foremost, be sure the letter comes from the student, not the parent – that creates a very positive impression. And the tone you use is critical. This is really SUCK-UP time, and you’d better be good at it. You start your letter with something like, “Thank you very much for your generous aid package; however, as much as I really want to attend your college, I am being offered more money from my very close-second choice college. Enclosed is their offer, and I would appreciate any help you can give me to make my decision final.” They won’t like the fact that you appealed, but colleges are a business, and they will horse-trade. If they don’t, you have to make a judgment call on whether that college is really worth attending.

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