Reading and understanding your financial aid award letter is a key part of assessing the cost of your college education.
Add to that offers from multiple schools and it can get confusing quickly. A financial aid award letter is the notification that students receive informing them how much financial aid a school is willing to offer. An award letter is often received around the same time as college acceptance letters.
Financial aid award letters are only for one year of school. The first step to reading financial aid award letters is to understand the elements they include. Here are the main parts to look for:. This can vary greatly, as depicted in this sample scenario:.
University B is clearly more expensive than University A, leaving the student with greater financial need. Once the details surrounding the amount of financial aid are received, you can compare offers from different schools by using a financial aid calculator. To fully understand the financial aid package being offered by a school, students must look beyond the basics contained in the award letter.
You can use the calculator to evaluate the impact of changes in income and assets on eligibility for need-based financial aid. Untaxed income can include retirement plan contributions and tax-free benefits such as Social Security disability and retirement benefit payments and unemployment benefits.
Other factors include your family size and the number of children attending college or a career school during the academic year. Expected Family Contribution will affect your eligibility for need-based financial aid as well as the amount of financial aid you receive.
This includes grants, scholarships, federal loans and student employment e. Parent assets include bank and brokerage accounts, and college savings plans. How to Save for College What is a plan? Other Savings Options plan vs. Loans Calculator See all calculators. Ratings and Reviews Best student loan refinance companies Best private student loans Best private student loans for parents Best private student loans for grad school Student loan reviews. Subscriptions Subscribe Support.
Knowing this helps us better customize your experience. Sorry, child information is required. I am saving for Select one 1 child 2 children 3 children more than 3 children. I want to learn more about college savings. Tip: Check with the financial aid office to find out if they consider special circumstances and if so, how you go about submitting a petition for reconsideration of your financial aid eligibility.
Toggle navigation U. Department of Education. Student Loans Grants Laws Data. Here are 5 things that will help you better understand how financial aid is awarded: 1. States, colleges, and outside agencies may require additional applications. Therefore, if your EFC is zero, that does not mean you will have zero out of pocket expenses.
Instead, the EFC is an index number used by financial aid offices to calculate how much financial aid you would receive if you were to attend their school. Contrary to popular belief, the EFC formula considers more than just income. Factors such as dependency status, family size, and the number of children in your family who are attending college are just a few of the additional factors considered.
In the interim, you can use the Net Price Calculator to help get a general idea of what aid you are likely to receive from a specific school. Item Link:.
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