While students begin scouring resources determining their best-fit college, parents are left scratching their heads on how to pay for it. With a few simple steps, parents can begin to get a grasp on paying for college and available financial aid.
1. Determine Cost of Attendance (COA) Many families go to the school website, look up the cost of tuition, add room and board and run with that number forgetting the cost of college includes fees, books, travel, and personal expenses. Be sure you add all the numbers to get the COA. You can also find this information on College Navigator – the U.S. Department of Education’s site; you’re looking for the “Total Expenses” line. This site also shows you the percent increase in cost from year to year which is great information to have. Nationally, the cost of college is outpacing the increase in income by 8 times.
2. Determine YOUR Net Price By law every college receiving federal money must include a Net Price Calculator on their school site by fall 2011. The best tools take time to complete and give you detailed information including expected grants or scholarships. However, most are quite simple (meeting the letter of the law) and are left with a bit to be desired. An additional resource for finding the net price is College Navigator in the “Net Price” section for each school.
3. Determine your Expected Family Contribution (EFC) In October of the student’s senior year of high school, most families will complete the Free Application for Federal Student Aid (FAFSA). Ultimately, the government gives you your EFC which determines how much need-based aid a family is eligible for. Want to get an early idea of what your EFC is? Use the FAFSA4caster.
4. Compare Indebtedness of Graduates The average college graduate in 2012 has just over $29,000 in loans to repay. Knowing the average indebtedness of graduates for schools of interest helps weigh the affordability of a school. Asking the school for this information is one way to get it or visit College InSight, a non-profit centered on college access and completion. One rule of thumb many use is to not have more college debt than you expect to earn in your first year out of school. However, the number you’re comfortable with is up to you.
5. Start the Scholarship Search There are many sites on the web dedicated to matching you with scholarships for which you are eligible. Go ahead and sign-up, but set-up a scholarship *only* email address so your personal email is not inundated. Keep in mind only .3% of college students get a full-ride according to Mark Kantrowitz, an author on scholarships.
In reality, you won’t likely have all your acceptance and aid offers until March or April of the senior year. It’s smart to do your homework and wait for all offers so you can compare. Seniors college commitment day is May 1st each year.