Absolute shock and desperation over financial aid letter

Paying for College
41

<p>I agree with MisterK. I think the college is assuming an anticipated income of 20K as the OP no longer needs her “earnings” to support a private school tuition. In addition to calmom’s great advice as to how to talk to the financial aid officers, I think you need to explain to them why you can’t work. Being 58 and not wanting to is certainly not a good reason. Maybe unemployment is high in your area? Maybe you have been job hunting for years and can’t get a job? Disabled? There may be a myriad of reasons and you don’t need to explain it to me. But if I was a financial aid officer, I would assume you can make at least 20K. </p>

<p>Another thing that I hear over and over again on these boards is “I want to leave something for future generations.” The colleges don’t care about this nor should they. It’s up to you to determine how important leaving an inheritance is.</p>

42

<p>I know that for prep school financial aid- Exeter I think, is one example, they put a salary expectation in for a second parent who doesn’t work or bring in income. So I definitely would explain the circumstances if I could. I’m sure that it will be exciting, but difficult for you when your daughter goes off to college. Will you continue to volunteer at her old school?</p>

43

<p>thanks to calmom for pointing out what I did not last night. Sure, SFS is a prestigious program, but so all IR programs in literally hundreds of colleges. IR is a hot major today - literally thousands of American kids graduating each year. If they have not lived (and worked) overseas for a period of time, their job prospects are no better than any other liberal art major. Do NOT take out massive loans to attend. The job prospects for IR major is not the same as accounting or engineering.</p>

<p>We are all speculating here, but are missing critical facts: home equity on top of IOU’s for 300k? how is it that the OP can send her kid on an overseas grad trip on $30k income? How is it that OP can send kid on expensive summer programs on $30k income. (If I was a college, that would be raising a flag.)</p>

<p>btw: colleges will NOT care that SSA is ending until it does. Expected Contribution for fall 2011 is based on 2010 full year income. If the child earned income vis SSA survivor benefits, she could have saved it for college (at least that is what is expected by colleges). When SSA benefits do end in two years, EFC will drop the following (senior?) year. But the point is that a college will use that income for fall 2011 financial aid.</p>

<p>MrK: before Profile takes a cut of income, it decrements a personal allowance. I forgot the exact amount, but I think its in the $16-20k level for a single parent.</p>

44

<p>Do not talk about “grad” school - many, many parents do not pay for grad school and it is not appropriate to this situation, do not talk about clothing, do not talk about foreign travel. Do talk to your daughter and explain what is happening. We all love our kids, but kids need to understand what is involved in funding college if only ‘big picture’. Stick to the facts and see what happens. Be careful about how to talk about the private school, yes you worked in lieu of her tuition, but you “could” have worked for a salary and she “could” have gone to public school it was just one decision you made along the way…so try to think through your arguments from the perspective of the college instead of from your perspective so you can anticipate how to answer questions appropriately. Lots of good points here from other posters so craft your answers from a non-emotional perspective before you call. Do make sure your D has an option that you feel comfortable financing in case this particular college does not work out. Best wishes.</p>

45

<p>I do think that you need to pursue this issue with Georgetown, BUT you need to prepare for Plan B simulataneously. You SHOULD NOT wait until AFTER you’ve determined that GU won’t work. It may be too late at that point to have a good Plan B. </p>

<p>**Another Plan B could be to go somewhere cheaper for 2 years, and then transfer to GU. Everyone would save that way. ** You D could take a NMF offer for 2 years, and then transfer to GU. This could give both of you time to figure out how to pay for those last 2 years. And, maybe by that point, you could have some of your money in some kind of protected retirement acct.</p>

<p>You’ve stated that you’re only comfortable paying about $3k per year (and that’s understandable). The truth is that it is highly doubtful that GU is going to go from $0 in grants to $40k per year in grants…leaving you with your $3k contribution, a fed loan for your D, her Pell Grant, and her summer contribution.</p>

<p>I think this is really more of an example of the aid that Georgetown (and Boston College) offers. They like to say that they meet need, but they must use a different formula than - say - Columbia. </p>

<p>There have been other posts this past week or so from people upset with their BC offers. They had much smaller FAFSA EFCs and not a lot of equity, yet they were given nothing from BC. I wouldn’t be surprised if Georgetown (another Jesuit) uses a similar very-ungenerous formula. </p>

<p>People keep using that 5.6% of assets formula. That’s FAFSA’s formula right? There’s no “rule” that CSS schools can’t use a different formula for assets. A CSS school can do whatever they want and figure assets at 10% (or whatever). </p>

<p>The school could also be projecting that this mom will now have time to work a minimum wage job at a dept store that could replenish some of what she’d be spending. Their formula may not allow people under retirement age to just not be working (unless disabled). They may feel that they’re under no obligation to subsidize a life-choice to live off interest of an investment. I’m just theorizing…I don’t know. </p>

<p>I do want to address the mom’s assumption that her D’s future job will be so high-paying that she’ll easily pay back loans. That depends on how much she’d have to borrow. It is doubtful that she’d be able to live as frugally as you do because she won’t only have a small $100k mortgage. As a business woman, she’ll have expenses you don’t have…clothing, hair, etc. </p>

<p>Federal Student loans are limited to about $30k TOTAL for 4 years FOR A REASON. Newish grads have a very hard time paying back bigger loans…even if they have high-paying jobs. ( Those who will have lower paying jobs should borrow much less than $30k overall)</p>

<p>Plus, life sometimes “gets in the way” of fabulous plans. Your D may fall in love with someone who must live in the US for his profession, and therefore she may no longer want to live abroad away from her beloved (seen this kind of thing happen a lot). Or, she could simply change her major like many students do and decide to be a doctor or lawyer or whatever! </p>

<p>For every $10k she borrows, estimate that her payments will be about $125 per month for 10 years. So, if she were to borrow $20k per year, she’d end up borrowing $80k, she’d owe $1000 per month for 10 years (which is waaaaaay tooooo much for adult between the ages of 23 - 33). </p>

<p>Frankly, I’m surprised that a mom such as yourself who is admirably thrifty :slight_smile: would even consider the possibility of either burdening your D with big debt OR ruining your own financial security. At this point, I would NOT be influenced by what an 18 year old says that she’s ok with borrowing. She has no idea of the negative impact of big loans. </p>

<p>I have a relative who borrowed heavily for her grad school (she’s a highly paid therapist). It took her FOREVER to pay back those loans and was miserable the entire time - especially when she later admitted that she could have gotten the same education at UCLA rather than USC (which was much more expensive). For over 20 years she had to work two jobs to pay this huge debt off. It took a huge emotional toll on her and her first marriage. </p>

<p>**Remember, the DREAM is the career…not the school. Don’t ruin the DREAM by burdening you or her with BIG loans. ** </p>

<p>I am a bit curious… your D is very ambitious, so why would you think she couldn’t earn the req’d 1700 for the summer? My kids each earn about $4k-5k over the summer.</p>

46

<p>^^mom2;</p>

<p>both GU and BC belong to the President’s 568 group, which (purportedly) agrees to calculate EFC the same way. Thus, 5.6% is a realistic number. In BC’s case, the posts that I have seen decrying lack of aid all had significant home equity driving up EFC. The wealthier schools will cap equity at a multiple of income; Stanford for example, but dunno about Columbia. I do not believe that GU or BC caps equity – they may use the full amount as an home equity as an asset, and assume that 5.6% is available for college expenses.</p>

<p>calmom may be correct. The college is inputing a higher asset value for the interest-bearing IOU’s. If so, it should be easy to corrrect. But, the OP reports that she has $100k in home equity and $300k in IOU’s/promissory notes for a total of $400k. That amount alone will require a contribution of $22k per year, which is nearly all of OP’s income…</p>

47

<p>Since your D wants to go to graduate school, then her undergrad is not nearly as important. It’s the terminal degree that matters.</p>

<p>Do not mistakenly think that your D has to go to a pricey undergrad in order to get accepted to a top grad school. My son will be graduating in May from a mid-tier flagship (on a NMF scholarship). He’s been accepted to every PhD program that he’s applied to (Mathematics) including top elites…EVERY single acceptance came with assistanceships of full tuition and generous stipends. They didn’t care that he went to a mid-tier public. They cared about his accomplishments, his excellent LORs, his essays, his GPA (4.0), and his top GRE scores.</p>

48

<p>How about this for a draft letter:</p>

<p>Dear Director of Financial Aid,</p>

<p>On or about MONTH DAY YEAR, I spoke with MS. JONES/AN INDIVIDUAL in your office about the likely financial aid package for MY DAUGHTER. At that time I was informed that I would expect to pay $X each year. Believing that that particular good-faith estimate was reliable, MY DAUGHTER turned down several excellent scholarship offers at other institutions. You can imagine our consternation when we received the actual figure of $Y from your office this week.</p>

<p>As University X is MY DAUGHTER’S clear first choice institution, I am interested in making an education there possible for her. However, I certainly am in no position to pay $Y and I do not understand how you could have arrived at that figure. I would truly appreciate an opportunity to discuss this matter with you by phone or by email. </p>

<p>You can reach me at…</p>

<p>Most sincerely,</p>

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<p>

</p>

<p>My thought exactly. I almost got up at 3 a.m. to write about this. The OP actually BARTERED her services at the school for the $20K or so per year tuition. I’m not a tax expert, but I believe a number of years ago, the IRS clamped down on these types of arrangements and that bartered “income” is actually supposed to be reported even though no money exchanged hands. I’m not sure how or where this goes on your tax form. In the past, we had bartered some services with a friend…we no longer do this because it’s too complicated with regards to tax reporting so we just pay each other.</p>

<p>To the OP…a question I’m wondering about…why did you turn down offers anywhere without having a firm financial aid offer from your child’s top school (which I’m guessing is Georgetown based on your other threads)? Hopefully there is someone out there who will understand your complicated situation.</p>

<p>Some things to remember…need based financial aid is not awarded to help families protect their assets for grad school, future generations or retirement. Any references to that in your letter should be removed. Need based aid is awarded to those without assets that are significant enough to make college payment possible. ALL schools expect families to dip into assets they have if they are in excess of a certain amount. Yours seem to be.</p>

<p>I agree with Bluebayou…something is missing. Yes, $300,000 in “assets” is significant but that in and of itself should not generate this $50K or so family contribution.</p>

<p>And again…it sounds like ALL of your income is unearned income which would indicate a significant amount of assets. </p>

<p>You would have to have $1million in assets at 3% to generate $30,000 a year.</p>

50

<p>Yes, the D can raise $1500 to $2000 with a part-time summer job…this is not out of the question – kids do it all the time all over the nation in all kinds of situations. $3000 is not a realistic contribution from the OP, and that needs to be thought out before discussing anything with the college…the OP is “living” off interest income essentially without working for income and almost every college would expect that the OP can contribute something north of $3000 in a similar vein to colleges expecting students to contribute a reasonable amount from a part-time job. </p>

<p>The OP needs to figure out in her head a realistic number that can be contributed since this is clearly a “negotiation” and that number needs to be reasonable. Even a minimum wage job could generate $10,000 after taxes above and beyond what the OP needs for living expenses (which is currently covered by the investments.) Negotiating is about meeting somewhere between two positions and the OP needs to figure out exactly what that “somewhere” is before calling the college. Emotional appeals about love and loss will not work I suspect. Any hint about Europe is going to hurt even if the OP negotiated everything for free. </p>

<p>There’s not a university or college in the country that doesn’t expect parents to give up something, and for some it is finding a better bargain at a different college or giving up 2 years to a community college, giving up a part of their salary, or giving up travel and incidental expenses. If this is THE college then the OP (and the D) need to figure out what that $$ is on their part and what they are willing to do to get there. If the answer is $3000 + $5500 in Staffords then they need to be prepared to walk away if the negotiation doesn’t go that way.</p>

51

<p>OP: The assumption your daughter will be making a lot of money in foreign service is living a pipe dream. An example is DH: He graduated from the SFS at GU and had an entry level position that paid $11.5 K/year. He also decided the political life wasn’t for him and moved on.</p>

52

<p>OP, your letter is too long and rambling. If you can afford a out of country trip, it might be interpreted as that you have money. I have rewritten your letter and others can weigh in, but you need to be direct and to the point, that you cannot afford it. Please use my suggestions as you think fit.</p>

<p>*Dear…</p>

<p>Thank you for taking the time to talk with me today. Please share this letter with the directors of your Financial Aid office.</p>

<p>I would like to emphasize that I cannot (repeat cannot) afford the aid package offered. To be blunt, the you have not offered much aid to a person with very limited income and EFC of $3846 (about $5000 with the Institutional formula). Realistically, I can only afford about $3000 per year. I would also like to point out that I was verbally (by…) told that my EFC would be around $9000, which seemed excessive but now it has jumped to $51,000, which to say the least is shocking and beyond my reach. Let me point out some salient facts:</p>

<p>1) My daughter a National Merit Finalist turned down some very lucrative offers as her dream school is your school. It now looks like a shattered dream.
2) I am a widow, subsisting on social security that will be withdrawn shortly (as my daughter will turn 18) and so will my daughters SS allowance. I do not have a job at present and hold only a volunteer position. I do not expect I will at my age get a full time job with paying anything much larger than minimum wage and will not be eligible for SS for a few more years.
3) We are off modest means and are very frugal in all our expenses.
4) My daughter has $1700 in her own account and you have considered all of it instead of about 20%.
5) If we do accept your offer, it will most certainly mean the loss of my house and any assets that I have.</p>

<p>I initially thought that your offer was misplaced decimal, but it appears that you have not taken into account any of the facts and circumstances of the case. Please thoughtfully reconsider, especially given the strength of the students record and the fact that she has persevered under such trying circumstances. I would like to talk to some one who can make decisions as your actions appear to be so callous and unrealistic. I have no idea how the EFC could go from about $3000 to $51,000.</p>

<p>Hoping to hear from you</p>

<p>*</p>

53

<p>Did the D receive a need-based scholarship to the private school? At the private school my D attended, students with that income likely would have received a generous tuition scholarship. I wonder if there was an application for that at the private school…maybe there was an underlying arrangement that would not be true barter. </p>

<p>I like the suggestion about doing two years cheaply elsewhere and then transferring to GU, although in two years, things change, and GU may not be the dream school any longer. </p>

<p>I would just re-iterate that the OP needs to stick to the facts and the present situation. </p>

<p>And, unlike everyone else here, if she wants to sell her house and get the $100K in cash, then buy a smaller property or rent an apartment, that might free up some money and since the OP will be living alone, a smaller place makes sense. (Lower utilities, less maintenance, hopefully.)</p>

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<p>sry, maze, but points 1-5 are of no significance to a financial aid officer, particularly at a college that does not court NM scholars. The point being that 1-5 offers nothing new that they already don’t know. </p>

<p>The ONLY question is what/how they determined EFC: what number ($) did they use for assets, and what number did they use for income. Without those two critical pieces of information, any (emotional) appeal is worthless.</p>

55

<p>Please also remember you have to appeal based on facts, not on emotions. Your daughter is important to you, as every son and daughter is to their parents. If they gave FA based on emotion, then you would have a cottage industry developing emotional letters. Yes emotion should show, but the facts are those that will win the day, so you need to emphasize the relevant facts.</p>

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<p>OK, then what are the facts? Those need to be emphasized, which I am not seeing the OP’s posting either.</p>

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<p>Since your D wants to go to graduate school, then her undergrad is not nearly as important. It’s the terminal degree that matters.</p>

<p>Do not mistakenly think that your D has to go to a pricey undergrad in order to get accepted to a top grad school. My son will be graduating in May from a mid-tier flagship (on a NMF scholarship). He’s been accepted to every PhD program that he’s applied to (Mathematics) including top elites…EVERY single acceptance came with assistanceships of full tuition and generous stipends. They didn’t care that he went to a mid-tier public. They cared about his accomplishments, his excellent LORs, his essays, his GPA (4.0), and his top GRE scores. My son isn’t unique. Many others could tell the same story.</p>

<p>both GU and BC belong to the President’s 568 group, which (purportedly) agrees to calculate EFC the same way. Thus, 5.6% is a realistic number. In BC’s case, the posts that I have seen decrying lack of aid all had significant home equity driving up EFC.</p>

<p>That may be so. But this mom doesn’t have significant home equity…I think she has about $150k…that’s not a lot. this suggests to me that GU (and BC) use something else to further determine a family contribution.</p>

<p>I don’t purport to know how GU (or BC) calculate “family contribution,” but it certainly doesn’t seem to use a formula that is similar to other (non-HYPS) full-need schools. Maybe they start with the formula that you said, and then tinker it in some way. </p>

<p>Perhaps a mistake was made with this student’s FA package, so of course it’s worth pursuing. However, I don’t think the school is going to go from $0 grants to $40k in grants (which is about the least this family needs). </p>

<p>We’ve seen adjustments made in the past to people’s FA packages and they seem to be in the “less than $10k range”…often only a $2-3k adjustment.</p>

<p>I know that for prep school financial aid- Exeter I think, is one example, they put a salary expectation in for a second parent who doesn’t work or bring in income.</p>

<p>There could be some truth to this…the Jesuits run high schools as well, so they’re probably used to having to tell families with SAHMs that they’re not going to give more aid just so mom doesn’t have to work (unless there’s a serious reason). My kids went to Catholic schools and they’re pretty used to telling families with one breadwinner that aid won’t be given just so a parent can be home.</p>

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<p>Thanks everybody for your comments. I’ll try to address some of these points.</p>

<p>About daughter’s summer income: I have no problem with her earning a couple thousand over the summer. I raised this point in my letter to the school only because I thought it indicated a general miscalculation on their side (first I thought they had confused my file with someone else’s—how naïve!). I’ll take it out.</p>

<p>The investments are through promissory notes. I receive 1099s every year and report the income on my taxes.</p>

<p>I feel the university is calculating based on a metric other than what I was told, which was 3-5% of assets. They seem to have been working backward from my interest income to calculate that I have nearly a million dollars. I wish!! The figures I gave them, and that I’ve shared on this site, are what they are. I’ve got nothing hidden away and as I said, I have maybe $3000 in the bank. </p>

<p>My home is small but adorable. After my husband died (we were always in debt, but rest his soul) I didn’t want to owe anybody anything and so I put down a $100K down payment (my grandfather’s money, carefully tended by my mother who was a real penny pincher) so that over time I’d end up paying less in interest. Of course that $100K isn’t earning interest, but I still think mathematically this was the right move. Some people have advised me to pay off my home fully because the value of home ownership isn’t considered in determining financial aid, but it seems that the opposite may be true in this particular situation</p>

<p>The senior trip represents months of hard work and fundraising. Expenses of the chaperones are covered. I’ll take that out of my letter.</p>

<p>Calmom’s section on professional judgment is very helpful. I’ll work some of that into my letter and check out that previous thread.</p>

<p>About the $81K I saved by working at my daughter’s private school: I had brought this up to the university to show that while I couldn’t find a nose-to-the-grindstone job in my small town, I calculated that I could make up that income by trading my labor for education, specifically at the invitation of the principal. This meant that I paid for private education what I would have paid for public school: very little. I thought that would be seen as a very great judgment on my part but when I talked to the school yesterday this was the point they first raised; so I may need to make it clear that I didn’t earn this income or pay taxes on it. I simply traded my work for education. This would be called sweat equity if I were building a house.</p>

<p>I think I’ll ask the university if they would honor, at least for the freshman year, the original offer of $9K max, even though it was verbal and not in writing, since it came from one of the deans of financial aid. I was clear in my figures when I talked to them and they gave me a number. I acted on it in good faith.</p>

<p>Thanks everybody, I really appreciate your help. (I’d have posted this earlier but I deleted my reply by mistake so now I’m composing in Word and then</p>

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<p>I don’t think it’s a good idea to say “at least for the freshman year.” What about the other three years? If you can’t afford it now, you can’t assume anything’s going to change in a year’s time. Your daughter might be forced to transfer after one year if they raise your expected contribution.</p>

<p>This school simply may not be affordable for your budget. The vast majority of private schools aren’t affordable for middle and lower-income Americans.</p>

60

<p>In my opinion, the facts or considerations are the OPs FAFSA, the amount of money that is saved in various investment vehecles excluding IRAs or other exempt retirement vehicles, the value of the work that “was” bartered for tuition that can now be turned into income at that school or another place of employment, the income that will no longer be availabe in SS. </p>

<p>An individual cannot “calculate” a institutional “EFC” since each college/uni calculates that individually. Some colleges do have their own on-line calculator which could be used for discussion but without an indivdiual college calculator there is no concrete point of negotiation.</p>

<p>Many private colleges expect a “student contribution” which is entirely different than what the student currently has in savings. Adding $1500 - $2500 to the student/parent burden in the form of savings or work-study or summer work expectations is not unreasonable and not uncommon.</p>

<p>Personally if this is a huge thing to the OP and the D (which I suspect it is) the OP is far, far better off asking for a phone meeting and scheduling a time for that rather than writing a letter…if there was a “error” then it will be revealed, if there is no “error” than the OP will understand the situation better if there is a dialogue rather than a letter out and a letter back with the potential for miscommunication and the OP will be able to move forward quicker either restructuring finances or choosing a different college.</p>