Deciphering the Financial Aid Award Letter

The amount of correspondence your student gets from colleges can be staggering. Before they’re even accepted you’ll be getting mountains of brochures, pamphlets, and other marketing materials. Then, once they do get in, even more information gets sent your way: housing forms, deposit slips, acceptance letters, campus information, and more.

There is one piece of mail you’ll be getting that should be studied carefully, since it will have a pretty big impact on your wallet. That is the financial aid award letter [Be aware that some colleges are moving towards electronic award letters. This means that rather than getting an envelope in the mail, you get login instructions in an email for the college’s website. Keep in mind that lots of email is sent to your student, so keep an eye on their account as well.]

Your award letter may look simple enough, but packed into that piece of paper is information on how much money your student is getting from the college, as well as how much your family will be expected to pay. No, it isn’t the same thing as a college bill, but it does serve the same purpose: letting you know how much college is going to cost.

Award letters will typically contain one or more of the following components: Scholarships, Grants, Work-Study, and Student Loans. How much your student receives depends on many things (Merit, your EFC, Demonstrated Need, Cost of Attendance to name a few) but the goal here is to define each and figure out what they mean to your bottom line.

Scholarships and Grants are forms of “free money”. This means that they do not have to be paid back to the college, the government, or whoever it was that gave them out. Every college has their own criteria for awarding this money, but typically we find that scholarships are Merit-Based (meaning they are contingent upon student grades, test scores, etc) and grants are Need-Based (meaning they are contingent on the family’s financial picture). If a scholarship or grant is Merit-Based, it is important to find out what the criteria is to keep that money. Your student may have to maintain a certain GPA in order to continue receiving those funds, something that is good to know in advance.

Work-Study is a form of “self-help”, meaning you aren’t just given the money up front. In this case, you have to work for it. This is usually done by getting a job on campus and working a set amount of hours every week. The student is paid at least minimum wage either weekly or biweekly. It is important to note that Work-Study does not come directly off the bill. Instead, the student works, gets paid, and is then expected to apply those funds to the college bill. Whether the student does this or not is another question entirely, but this is the concept of Work-Study.

Student Loans are also a form of “self-help”, because in this case the money eventually has to be paid back. The most common student loans are Stafford Loans (subsidized and unsubsidized) and Perkins Loans. These loans are good because they are fixed rate, government guaranteed, do not require a co-signer or credit check, and payment is typically deferred until after the student graduates. It should be noted that PLUS loans, which are parent loans, are NOT a form of financial aid. Some colleges put these loans on their award letters, but don’t be fooled. Sure, the PLUS program is a federal program where parents can borrow for their student’s education, but it is NOT considered financial aid.

While every college awards financial aid differently, these are the four main types of aid that your student could receive. Of course we’d like to see more scholarship and grant money than anything else, but that depends on Student Positioning (for Merit money) and Financial Positioning (for Need-Based money). These are also important topics, but for another day and another blog. Until next time…

About the author: Justin Munio is a Business Development Manager and Financial Aid Consultant with the Smart Track™ Toolkit. Over the past 4 years Justin has been at the forefront of the financial aid process for the families of the Smart Track™ Toolkit.

About Smart Track™ Toolkit: The toolkit is a web based service that assists families with everything from admissions and test prep, to student athletics and financial aid. Our intuitive software and on-demand workshops are key components to making sure students find their top choice colleges, and families can afford to send them there.

7 WAYS TO BEAT COLLEGE STRESS – PART 1

By Erika Rae - Grockit

So you beat the SAT, after taking advantage of Grockit test prep, practice tests, and free SAT questions. You wrote a terrific college application essay and did so well in your admissions interview, that you were accepted to your dream school. Now, there are more tests ahead of you as an undergrad – not just chemistry quizzes and history exams, but also physical, mental, and emotional stuff that will challenge you in ways you probably haven't experienced yet. Here are some ways to beat stress in college:

1. Get Busy & Be Patient, Too
To keep your mind off missing home, keep yourself busy with orientation parties, campus events, and dorm mixers. The beginning of the year is a great time to check out lots of clubs and meet lots of people – but it's also a stressful time if you're constantly “on.” Don't try to jump in and join everything – and don't worry about finding your place and your people immediately – or you'll totally drain your batteries. Relax. Be patient. You will feel at home, eventually.


2. Call Your Mom & Email Your BFF
While you're having a terrific time exploring the campus, checking out organizations, and making new friends, you're probably also going to have some lonely days and boring nights. When you have a rough day, it really helps to contact your parents or best friend. Your family and oldest friends know you best, and they might be the best people to get you feeling connected and grounded again. Remember you'll probably see them soon – and even if you don't head home for the holidays, you can keep in touch with calls, emails, letters, and care packages (which you can hint about when you call).

3. When Work Piles Up, Stay on Top
First: Check out the locations of your classes and how long it takes to get to each one, so you don't show up late, breathless, and stressed. Second: Every prof seems to think that his or her class is your only one, and the work will be piled on accordingly – but the workload should balance out, and even if it doesn't, your ability to handle it will improve. Third: Create a schedule of all your classes, study time, and free time and post it in your room. Stay on top of it, and you won't get overwhelmed by it.

4. Escape Pod
Find yourself a secret spot somewhere – preferably off-campus – where you can escape everything college-related. A bike trail that leads to a huge oak by the river. A bench at the baseball diamond in the city park. A corner table at a greasy diner. Go there as often as you can – even for just twenty minutes each day or every week – to get quiet and be alone. Just closing your eyes and breathing deeply for a few minutes can be a very effective form of meditating and reducing stress.

Tips on Completing your FAFSA

If you’re the parent of a student who is in college or is headed off to college soon, then you’ve no doubt heard of the “Free Application for Federal Student Aid”, or the “FAFSA”. If you’ve never heard of it though, the FAFSA is the Federal Government’s application for financial aid for college. It determines how much you are expected to pay for your student’s college education, one year at a time. Oh, and in case you think that “free” means “easy”, a few years back our Secretary of Education Arne Duncan told Congress, “You basically need a Ph.D. to figure that thing out!”…and he’s a Harvard guy.

The FAFSA is arguably the single most important application in determining how much and what type of financial aid a family will receive. However, it has failed to keep up with the changing composition of our families and our lives. Confusion is widespread and can lead to an inaccurate portrayal of a family's finances.

A more recent example: One of our advisors just attended College Goal Sunday, an event dedicated to helping families complete the FAFSA for their students in one afternoon. After attending, this advisor couldn’t believe the amount of difficulty that people were having. I had to remind him that even the most “basic” questions to college guys like us could be complicated and complex for the everyday person. If you don’t deal with college financial aid everyday, how can you be expected to automatically understand one of the most daunting financial aid applications out there?

When our company hosts local college workshops, we try to take a few minutes to answer individual concerns. Many of the questions tend to be the same for middle and upper middle class families so I thought I'd summarize five of the more common issues here.  Quick disclaimer:  these responses are general and should be considered a guideline, not a recommendation -- remember, no two families have exactly the same circumstances.  Finally, the guidelines for the FAFSA are available through the Department of Education. Keep in mind that it may be similar to deciphering Greek or the entire IRS Code, but these guidelines are out there.

1. The student is the applicant. Any reference to 'You' or 'Your' on the FAFSA and on the CSS/Profile refers to the student! Don’t make the mistake of accidentally listing parent income or assets under the student’s name. This can cause a huge problem and may result in the colleges thinking you can afford more than you’re supposed to.

2. On the matter of children with separated or divorced parents: Dept. of Education guidelines require that the applicant report the household income and assets of the legal parent who provides more support. This is typically the household where the student lives the majority of the time. Just keep in mind that the non-custodial parent's household is largely ignored on the FAFSA, but will likely be counted in the CSS/Profile formula.

3.  For most business owners, the proper value of their business is “$0”.  Why? Well according to the FAFSA, a “business” is only a “business” if it has 100 or more employees. Those with fewer than 100 employees should be exempt, but  I’ve seen CPAs make the mistake of reporting a value greater than $0 when trying to fill out a FAFSA and lose thousands in potential financial aid.

4. I get so many questions from parents who want to 'emancipate' their children so that they can be considered “independent” on the FAFSA. Unfortunately, “independent” for the FAFSA and “independent” for your tax return are two completely different things. The Dept. of Education has certain criteria to determine whether a student is “independent” and trust me, you don't want to answer 'Yes' to these questions, at least not yet (like, for example, whether your child is married or has dependents of their own).

5. Work-Study is a great program. You probably realize that most colleges do not give out 100% free money.  Most schools award a combination of free money and loans/work-study.  You should check 'yes', indicating that you wish to be considered. You can always appeal later or decline the work-study offered, but it's harder to ask for it later. Besides, if your kid works 10-20 hours a week and makes a few extra bucks, that's a good thing.

6. Cash, checking, savings, and investments:  Aside from questions about your income, the FAFSA will also ask about assets. A key point is this: You don't have to disclosing the value of your retirement accounts or the value of your primary residence! The FAFSA specifically tells you not to include those assets, so don't! You do however, need to enter the total amounts of cash holdings you have as of the day you file. So, if you have to, make any large payments (like mortgage, etc) BEFORE you file.  As for other non-retirement assets, there is an asset protection allowance, and certain annuities and insurance products could also be exempt. A good rule of thumb: consult a professional college advisor if you have more than $50,000 worth of non-retirement assets.

We do cover a lot more information than just this in our workshops, so if you are local to the greater Boston area, we encourage you to come out over the next couple of weeks.  We conduct our workshops at venues like high schools and libraries, and they are of course open to the public. If you have college-bound children and want to attend, simply click here to register. If you don't, please send this on to someone who does -- I'm certain they'll thank you for it.

If you are not local or can't make it to one of these workshops, that’s OK. Check out our brand new videos we just finished to see what parents and other professionals are saying about our online college planning toolkit. It’s nice to save time and money, not to mention have a seasoned team of professionals by your side as you try to navigate the college planning process.

Best of success,

Murray Miller, CEO

College Resource Center, LLC

Admissions Boot Camps Across the Country: The Breakdown

There are many different organizations around the country that provide some kind of admissions “boot camp” for students getting ready to apply to college.  Typically they are offered for a couple of days in the summer before the student enters their senior year.  They essentially go through the entire college admissions process and get students ready to submit their college applications.  They are designed to help students and parents get ahead of the game so that they are done with the process early on in their senior year, eliminating a stressful fall application season.  Here we will outline just a few of the college admissions boot camps around the country. As you will see the fees for these events vary immensely although from what we can tell the content and deliverables are quite similar. If you do decide to take advantage of one of these events we suggest reading what it is that each offers carefully and speak with a representative from each company before you hand over your credit card...

Application Boot Camp (ABC)

Overview: Dr. Michele Hernandez and Mimi Doe cofounded Application Boot Camp® LLC after publishing their book, Don’t Worry: You’ll Get In in 2005. Application Boot Camp® LLC is a company devoted to empowering high school students from around the world in the college admissions process. Application Boot Camp® LLC offers a four day program for students entering their senior year of high school. Students have the opportunity to work with Michele and Mimi and leverage their experiences to create applications that rise above the rest.

Intent: Develop an application strategy to increase college acceptance possibilities

Date: August 2012

Length: 4 days

For Who: Rising Seniors

Activities: Work on common application; prepare essay(s); develop application strategy; receive advice on their odds at top colleges; complete an activity sheet; take part in mock interviews and interview training.

Cost: $14,000

Website: http://www.applicationbootcamp.com/application-bootcamp

College Admissions Bootcamp – Via Smart Track™ Toolkit

Overview:  The College Resource Center, LLC  was founded in 2009 by Murray Miller and Scott Greenameyer to provide families and organizations with an online platform for the college planning process.  Murray and Scott, along with their professional staff, combined their years of experience and the tools they use daily to create the company's proprietary Smart Track™ Toolkit.  The College Admissions Bootcamp was created to give students the ability to attend a live version of the Toolkit and to jump start their college planning and college applications.  For two days during the summer, the College Admissions Bootcamp helps students overcome the challenges of the college admissions process and gets students on the Smart Track™ to college success.

Intent: Get your student on the right track before they start their senior year, before most of their peers, and before they get overwhelmed.

Date: August 2012

Length: 2 days

For Who: Rising Seniors

Activities: Create an initial college list; work on the Common Application; prepare essay(s) and receive feedback from professional essay editors during the event; develop an application strategy; take part in mock interviews and interview training; engage in SAT/ACT test prep; and not only receive advice from experts in admissions, but also attend workshops presented by experts in financial aid and student-athletics. Attendees will also be addressed by an actual admission officer from a top tier college and will be given a behind the scenes private campus tour while onsite.

Cost: $1,595 (discounts are available for early registrants)

Website: https://smarttracktoolkit.com/bootcamp

College Admissions Boot Camps 2012

Overview: College Admissions Boot Camps (CABC) are interactive, informative, activity-oriented and intensive four-day workshops for navigating specific elements of the complex, anxiety-ridden and competitive college admissions process.  They are programs held jointly with BHA Education Consultants and Pinnacle Educational Center.  Sessions are in July and August, in Greenwich, CT and Midtown Manhattan.  Participants will receive inside tips, recommendations and expert advice from BHA Education Consultants and former admissions officers and representatives from Ivy League, highly selective and competitive colleges.

Intent:  Aiding students in navigating specific elements of the complex, anxiety-ridden and competitive college admissions process

Date: July & August 2012

Length: 4 days

For Who: Rising Seniors

Activities: Receive inside tips, recommendations and expert advice from leading college admissions experts; design an activity sheet that makes you shine; write a "Why the college" essay that will dazzle the admissions committee; learn to impress in interviews; garner the right recommendations; finish applications before senior year starts; gain a competitive edge in the hypercompetitive college admissions environment.  General topics to be covered include: standardized test preparation, choosing the right college, what top colleges are looking for, planning campus visits, developing a college admissions calendar, an admissions committee review, sessions for student-athletes and student-artists, financial aid / scholarships, post-admissions process.

Cost: $7,500

Website: http://www.collegeadmissionsbootcamps.com/1801.html

3 Critical Questions to Research So You Can Get Grants, Scholarships and Other Financial Aid You Deserve

So how do you beat the colleges at their own game? Here are three areas to research.
 

1. Determine what percentage of financial need each college on your list has met historically. All things being roughly equal, wouldn’t you rather attend a more generous school compared to a stingy one?

2. Determine how that college meets need – i.e. the breakdown between free stuff (grants and scholarships) and self-help (loans/work study.) Two colleges could meet the same overall percentage of need, but your financial aid could be vastly different between the two.

3. Pin down the priority deadlines – some schools require forms as early as November 1! Others may want you to file by February 15th. Make sure you research deadlines for each college on your list, since a lot of financial aid is first come, first served.

Now, a quick word on how to use the information uncovered in #1 and #2, above. The ‘formula’ used by each school to determine your financial aid award is as follows: COA (Cost of Attendance) – EFC (Expected Family Contribution) = Need. Schools award financial aid based on how much need you show. As noted above, once you identify the percentage of need that your college meets, you have a decent handle on what your award will look like. Here is a simplified example:

Assume two colleges with a $50,000 Cost of Attendance and a $25,000 EFC. Your Need is $25,000. If “College A” meets 100% of need, you’ll receive an award of about $25,000 and your cost will be your EFC of $25,000. However, only the most elite, competitive colleges in the country will meet 100% of need. Most do not. If “College B” only meets 80% of need, you may only receive $20,000 in aid, and you’ll have to pay about $30,000 (this is your EFC + the 20% unmet portion). So your total out of pocket for one year at the second school is $5,000 more than the first school, even though their sticker prices may be the same.

How can you obtain these facts? The first place is to look on the websites of each college. Understand that you will have to click around for a while – colleges don’t make this information easy to find. You can also call the financial aid office but you may end up frustrated by the lack of responsiveness, according to most of the parents we work with. Another great resource is College Board - www.collegeboard.org. The information on there is trustworthy for the most part, but you have to really dig at it. You’d be well-served to consult a qualified college finance specialist. For example, our firm has all of this information at our fingertips and we get a lot of it directly from the colleges and some from the Department of Education. Our Smart Track™ Toolkit website has the tools (many of them for FREE) to help you project what each college will award within a small margin of error, and suggest legal and ethical ways to qualify for more grants and scholarships than you would on your own. No matter whether you seek out expert help or do it yourself, preparation and research can pay off in a big way. Don’t put it off or you could lose out – on tens of thousands of dollars in financial aid.

MurrayMiller is a financial educator devoted to the college planning space for over a decade.  Murray is the President and CEO of the College Resource Center, LLC.  You may contact him by emailing info@smarttracktoolkit.com or by calling 800-863-9440. For more information, including a schedule of free college workshops, visit www.SmartTrackToolkit.com.

About Smart Track™ Toolkit: The toolkit is a web based service that assists families with everything from admissions and test prep, to student athletics and financial aid. Our intuitive software and on-demand workshops are key components to making sure students find their top choice colleges, and families can afford to send them there.

Connect with us

http://www.facebook.com/smarttracktoolkit

http://twitter.com/uchoosecollege

The Academic Perspective

When applying to colleges, we suggest you consider four different perspectives and weigh them each accordingly:

• Academic Perspective (40%)
• Financial Perspective (30%)
• Social Perspective (15%)
• Campus Perspective (15%)

This week we’ll discuss the most important perspective to look at when considering where you are going to apply to college – academics. After all, you are going to college to earn an academic degree in order to acquire the knowledge and skills you need to get a well-paying job in your intended career field after graduation. Let’s not forget that!

Safety, Target, Reach: If you haven’t heard these terms before, you will.

• Safety schools are schools that you have a really good chance of getting into. Your academic profile (GPA, SAT/ACT scores) is stronger than most of the other applicants. For example, you have a GPA of a 3.7 and the mean GPA for admitted students is a 3.4. We suggest you apply to about 2-4 safety schools so that you have a back up plan in case you don’t get into your top choices. We also suggest you apply to safety schools because most schools that will give you merit-based financial aid awards will be your safety schools. You will be a very strong applicant at these schools and colleges will be very interested in you.

• Target schools are schools that you have a decent chance of getting into because your academic profile is average for what those colleges typically accept. For example, if you have an SAT score of 1800, the mean SAT for incoming freshman at that school is an 1800. You are right on “target” with the school’s standards. We suggest you apply to about 3-5 target schools. While you have a good chance of being accepted, don’t forget that your academic profile will look almost identical to thousands of other applicants. You will need to do something to set yourself apart in your applications. You will need to work hard on your admissions essay and consider scheduling an admissions interview.

• Reach schools are colleges where it would be a stretch for you to be admitted. Your academic profile is weaker than most candidates. For example, if you have an ACT score of 21, these colleges may require ACT scores of about 28 or even higher. Now, we would never tell you not to apply to a reach school. Your chances are limited, but you never know. You could write a stellar essay or have an amazing interview. But don’t forget that even if you get in to some of your reach schools, you will want to ultimately pick a school that challenges you but that is not TOO challenging. We want you to be stretched, not stressed. Just because you got in doesn’t mean you can handle the work once you get there. We suggest you apply to 2-4 reach schools.

Depth vs. Breadth of Courses Offered: When making your college list, you will want to consider what you are interested in and potential majors and career fields. If you know exactly what you want to major in, for example engineering, you will want a college with a depth course catalog for engineering (ex. – chemical, mechanical, aeronautical, etc). However, if you are unsure of what you will major in and will go in undecided and declare your major later, you will need to make sure that you have a breadth (wide variety) of courses and majors to pick and choose from so that you’ll have options when you learn what you want to do.

Special Programs: When looking at colleges, you need look into any special programs that you will want your future school to offer. Do you want an honors program? What about a cooperative or internship program? Are you looking to study abroad? Do you want to have distance learning options? If you are interested in a special program such as one of these, you need to make sure that your colleges offer them.

Graduation Rates: According to College Board, the national average for graduating college in 4 years is a staggering 44%. Some colleges do a lot better than others in getting their students to graduation in four years. Some colleges offer great academic counseling and advising and additional support and others don’t. Search for your colleges on CollegeResults.org and see what the graduation rates are. On your visits and tours, consider asking why the rates are what they are. Taking more than four years to graduate means two things: wasted time and money. Be sure you have the resources you need to get through college in four years.


Alumni Network: Alumni networks can be very helpful at colleges. Some colleges will connect you to alumni in your chosen career field who will be available to answer your questions and even connect you to other professionals. This is a great networking opportunity and they can even help you with your job search during and after college.


Employment Stats of Grads: In this economy, you will want to research the employment statistics of graduates of the colleges you are looking at. Are most of them able to get jobs right after graduation? Is there any kind of program at the college that helps or even guarantees students jobs after graduation? Most of these statistics you can find right on the college’s website. However, if they aren’t exactly up to par, you may have to dig and do additional research to find them. Also be sure to look into the college’s career services. Do they have a career center? What services do they provide? Are they accessible? Go in with the end in mind and make sure that you have the best chances possible to have a great job after you graduate.

Remember, college research takes a lot of time to do well and to truly find the best fit college for you. Start early and take your time. Gather input from people who know you well – parents, teachers, counselor, coach, friends. You’ll need to visit your schools and ask questions, ask questions, ask questions. Ultimately, you really want to find a school that will value you for what you do well and somewhere where you will be happy. This is not an overnight decision. Don’t wait until the last minute!

Any additional tips to share? Leave your comments!

About Smart Track™ Toolkit: The toolkit is a web based service that assists families with everything from admissions and test prep, to student athletics and financial aid. Our intuitive software and on-demand workshops are key components to making sure students find their top choice colleges, and families can afford to send them there.

About the author: Laura Guarino is the Student Services Coordinator with the College Resource Center, LLC. Laura has a degree in Human Development from Boston College and is currently pursuing a Master’s degree in School Guidance Counseling. She is also enrolled in a certificate program in College Admissions Counseling. Laura is at the forefront of the college admissions process for the families of the College Resource Center and The Smart Track™ Toolkit.

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Infographic: An Inside Look at College Admissions Today

An Inside Look at College Admissions Today
StudentAdvisor.com

The changing nature of college admissions in the US has been the source of much stress and confusion to college-bound students and their parents. To understand how the process of getting into college has evolved over time, counselors, educators, students, and parents look to various research studies to derive meaning from the numbers.

Curious to know what the college admissions process is like today? Take a look at StudentAdvisor's infographic "An Inside Look at College Admissions Today" containing data from recent research findings from the National Association of College Admissions Counseling, College Board, and the US Department of Education: