Understanding Financial Aid Awards
April, besides being tax time, is National Financial Literacy Month. For families with a high school senior, it’s also when college acceptances (congratulations!) and financial aid notifications are arriving. And with many colleges expecting a deposit for the coming school year by May 1, it can be a month of tough decisions.
That’s why we’re devoting this blog to help families interpret financial aid awards. Before those college stickers go on the car, follow these tips.
Pay attention and weigh your options. The financial aid awards you’ll be receiving from each school can vary widely. Take a look at the examples at www.vsac.org/awardsamples to decode some of the “financial-aid-speak.”
Then follow the steps below; a little time spent now may end up saving you a lot of debt down the road.
(Note: If you haven’t yet applied for financial aid, including both the FAFSA and the Vermont state grant, you should apply now so that you can be considered. It’s the first step in getting money for college. Don’t miss out!)
1. Use our online spreadsheet tool to crunch the numbers.
Add up your total college costs—not just the tuition and fees, but room and board, transportation, books, and personal items throughout the year. This is the best way to get an accurate idea of what that school will cost. (If that info isn’t listed in your award, go online or call the financial aid office to ask for those figures.)
Subtract your total in grants and scholarships. These are gift aid--funds you don’t have to repay. If you’ve received work-study, which is money you can earn by working at a campus job, you may also be able to subtract those dollars from your costs, depending on how your school handles those awards.
Calculate the remaining amount. That’s what you’ll pay for one year of college. (To estimate your full college cost, multiply this amount by the number of years needed for your degree.)
Most families don’t have this amount in savings, so they typically meet at least part of it through loans.
2. Review the My Education Loans guide to learn what you need to know about education loans. It’s a must-read before you borrow for college!
3. Learn more about your loan options, including the Vermont Advantage loan, which has rates lower than the federal PLUS. Before accepting loans to pay part of the college costs, compare all loans you’re eligible for so you can choose those with the terms that best meet your family’s needs. You can accept scholarship and grant aid now, and make your loan decisions later on. To sign up for loan info for the 2017–2018 academic year, click here.
Get all the info you need to make your decision. In the end, you’ll want to choose the school that fits the needs of your family. Which school will give you the best educational experience with the lowest debt? Using the right online tools and learning what you need to know about loans—before you sign on the dotted line—will go a long way toward making the choice that’s best for you and your family.
Remember, VSAC is here to help you with this process. For more on financial aid and planning for college expenses, go to vsac.org.