As college tuition costs continue to rise every year, 90% of undergraduate students rely on their financial aid package to help defray some of those expenses. This means substantial student loan debt upon graduation for some, so it’s more important than ever to explore as many financial aid and scholarship resources as possible. For most students, their financial aid award ultimately determines which college they attend (assuming it was on the short list of schools they wanted to attend anyway).
How to apply for aid
David A. Peterson, Assistant Vice Provost at the University of Cincinnati (UC), says UC’s students are eligible for all types of financial aid. “We first look at scholarship and grant eligibility based on merit or need," he says. "Self-help sources such as work-study and student loans are considered next. Many aid programs are awarded on a first-come, first-served basis, so we encourage all students to complete the Free Application for Federal Student Aid (FAFSA) as soon as possible after October 1 of each year.” [Please note that October 1 has historically been the opening date for the FAFSA, but recent changes under the FAFSA Simplification Act have delayed this date for the past couple of cycles. Always check the official FAFSA website for the most up-to-date information.]
The Free Application for Federal Student Aid
The FAFSA is the standard application for federal and state financial aid and is available online at fafsa.gov or through your high school counselor’s office. Local and regional scholarships usually have their own applications and eligibility guidelines, so read each application and their deadlines closely.
Although just the first step in the process, the FAFSA is an important piece of your final financial aid package, explains Scott Andrew Schulz, PhD, Vice President for Enrollment Management at Baldwin Wallace University in Berea, Ohio. “It’s critical because it provides an institution with a standardized method of assessing [the student’s] financial need. Information from the FAFSA is used by the government to create a [Student Aid Index]"—aka the SAI, which used to be called Expected Family Contribution or EFC. "Depending on the [SAI], students then qualify for various types and levels of need-based financial aid from federal, state, and institutional sources.” To put it simply, “If you don’t apply, you won’t be eligible for financial aid, which includes student loans,” says Kendra M. Feigert, Director of Financial Aid at Lebanon Valley College in Annville, Pennsylvania.
The CSS Profile
Besides the FAFSA, some institutions use the College Scholarship Services (CSS) Profile “to gather more extensive information about a student’s financial profile—including the amount of home equity a family may have—before determining what level of institutional aid a student may qualify to receive,” says Schulz. “Whereas the FAFSA is administered by the federal government, the Profile is a service administered by the College Board, a nonprofit organization that charges institutions to receive CSS Profile information. Institutions may use the Profile to better inform the distribution of institutional aid or, if they are need-aware during the admission process, would use the Profile to consider a student’s financial resources when assessing their fit for admission.”
Feigert says Lebanon Valley College doesn't require the CSS Profile but cautions that “you must pay to file the form, so be sure it’s required before filing. The FAFSA is free, and students should not be paying to complete or paying anyone to complete it for them.” Feigert adds that the Pennsylvania Higher Education Assistance Agency (PHEAA) coordinates free FAFSA completion workshops at high schools and post-secondary institutions across the state in the fall of each year. Be sure to check into FAFSA workshops being offered at or near your school.
Related: What You Need to Know About the CSS Profile
How financial aid awards are calculated
Post-secondary schools consider various factors when putting together financial aid packages, and they follow a formula to determine each student’s aid offers. “The basic formula to determine financial need is cost of attendance of the institution, minus [your SAI] (calculated by the FAFSA), equals financial need,” Feigert explains. “Financial need is the figure institutions are trying to meet with grants, scholarships, student loans, and work-study. Not all institutions meet 100% of financial need.”
When a student submits the FAFSA, they indicate which colleges and universities should receive their financial information. “Once received by an institution, students are put through a packaging system that considers their academic profile and financial need, then packages a mix of merit- and need-based aid (including grants, loans, and work-study funds) up to a certain amount to help put the institution within financial reach," Schulz says. "Every financial aid package is uniquely tailored to the qualification and needs of an individual student."
Every student’s financial profile is unique
Don’t compare yourself to your friends when it comes to paying for college, as each family’s financial profile is different. Even if you aren’t in the top 10% of your class or carrying a weighted course load, you may still be eligible for scholarships or other types of financial aid and awards.
Schulz says you shouldn’t reject a college simply because it’s “too expensive” either, as you could receive a substantial financial aid package. “More specifically, students may see a tuition rate or cost of attendance [aka the “sticker price”] on a website, assume the school is out of reach financially, and never apply for admission,” he says. “Many colleges and universities, including Baldwin Wallace, don’t charge an application fee when applying online, and there is no obligation to enroll if admitted (unless applying through a special program known as Early Decision, found at a select number of institutions throughout the country). As such, if a student believes an institution could be a strong fit, it would make sense for them to apply regardless of the stated cost of attendance.”
No one likes the idea of taking out student loans, but it’s important to understand that not all loan debt is created equal, Schulz adds. “Many people don’t hesitate to finance a vehicle, for example," which currently carries an average cost of about $47,000, according to Kelley Blue Book. "According to the College Board, the average amount of loan debt for a college graduate is about $28,500.
“Rather than assume an institution is unaffordable because it may require a student loan to meet the full cost of attendance, parents and students should instead focus on loan default rates and graduation rates to assess how well a college or university succeeds at preparing career-ready graduates," Schulz advises. "Loan default rates and graduation rates are available to the public.”
Related: Should I Apply for Financial Aid If I May Not Be Eligible?
Pitfalls to avoid when applying for aid
When you’ve narrowed down your college search and are ready to complete the FAFSA, Feigert cautions against these common mistakes that could cost you valuable financial aid:
- Missing deadlines
- Not following instructions on the FAFSA, specifically misreporting income and/or assets
- Choosing to borrow private student loans first before borrowing the Federal Direct Loan, which has lower interest rates and more flexible repayment options
Another common mistake? Not responding to requests for information. “Many student frustrations with the financial aid process can be traced back to an outstanding form or an unopened email,” Peterson says. “Email is the primary communication method for university offices, so be sure to check it often.”
Schulz points out that the FAFSA determines a student’s financial need based on information submitted from two tax cycles ago, and their circumstances may change in that time. Any significant change to your financial status could impact your financial aid; if your parents’ employment changes (for better or worse) or an unexpected illness causes financial hardship, contact the awarding institution as soon as possible. “In these cases, as well as other hardship situations, students may file a special circumstance appeal to a financial aid office and request additional consideration for financial aid,” Schulz says.
Related: 5 Simple Mistakes to Avoid on the FAFSA
Why “small” scholarships matter
Rather than only applying for awards of several thousand dollars and/or taking out a student loan for several thousand more, don’t rule out smaller scholarships, even if they are only a few hundred dollars. Your high school counselor can help you find and apply for these small, more local awards. “Every little bit helps!” says Feigert. “Local scholarships really do exist and help reduce the cost [of college]." The best resource for local/regional awards is your high school counseling office, and the fall of your senior year is a good time to start researching and applying if you haven't started already. “It’s important that students inquire with the financial aid offices of the institutions to which they apply and inquire how private scholarships may impact other financial aid,” she adds.
Smaller scholarships can be an important financial “bridge” for families, according to Schulz. “Higher education often requires a significant investment from families,” he says. “Although students will likely receive a mix of merit scholarships and need-based financial aid from federal, state, and institutional sources, other means of financial aid such as outside scholarships may help fill any potential gap between a family’s out-of-pocket responsibility and financial aid versus the full cost of attending a school. This may also reduce the need for loans, although loans are typically part of a student’s financial aid package.”
Finding scholarships you can win
Besides working with your school counselor on the scholarship search, do some research on your own. Not all scholarships are granted based on grades alone—creativity and critical thinking count as well. Scholarships are available for everything from zombie apocalypse survival plans to creative prom attire using Duct Tape. Students can win scholarships for a wide range of distinctions and even physical attributes or quirks of nature. For instance, Juniata College in Huntington, Pennsylvania, offers a scholarship for students who have demonstrated academic success, financial need, and the fact that they are left-handed. Are you a twin, triplet, or even a quadruplet or quintuplet? There are scholarships out there for you too.
There are also awards available for students with unique skills and those who have earned prestigious awards such as the Gold Award as a Girl Scout or the Eagle Scout as a Boy Scout. If you can think of it, there’s likely some type of scholarship money available for it. Start by Googling “unique high school scholarships” and get ready to be amazed by what’s available.
Related: The Ultimate Scholarship Guide: Searching for Scholarships
Final advice from the professionals
Navigating the higher education financial aid process can be complicated and overwhelming, but financial aid officers have a few tips to make it a bit easier. “The best advice I can offer is to read the information provided by colleges, universities, and high school counselors; ask questions of the experts, not family and friends!” says Feigert. “While they’re certainly well intentioned, the process is complex, ever-changing, and will vary among colleges and universities.”
She points out studentaid.gov as a good resource for federal financial aid; SmartBorrowing.org is another helpful financial literacy tool. And finally, be involved in the financial aid process. “Remember, this is your education, and you’ll likely be financing (borrowing) your education to some degree and need to understand this obligation,” Feigert says.
“Learning to make and live within a budget will help your financial aid package go further than you expect,” Peterson adds. “Be money smart.” A family should never be afraid to ask questions during any part of the financial aid process. And as the college-bound student, don’t leave everything up to your parents. Understanding household budgets and your family’s complete financial picture is a great introduction to adulthood and taking an active interest in your future beyond just homework and grades.
Think of it as laying the financial foundation for your post–high school life. “Higher education requires a significant investment but still provides the greatest vehicle for social and economic mobility,” Schulz says. “Trust in the process, and make sure you have a clear and complete understanding regarding your options before making a choice regarding your future.”
Need help supplementing your financial aid packages? Start finding and applying for award money with our Scholarship Search tool!
