I know discussing FA is a sensitive subject but I am curious about anyone else’s insight and experience…My understanding is the AccessUVa scholarship is purely need based. We were a little surprised when we found out another incoming student received a fairly large amount when we know the family is what I think most would consider upper-middle class. Of course, I readily admit I don’t know the details of their financials, just outward appearances based on house, lifestyle, etc…
My child in comparison was offered a loan that would cover 1/7th of the cost of attendance.
I don’t mean to come across as sour grapes but rather wondering if there are things we could be doing financially that would give us a better FA score? Does having a decent amount in savings actually hurt us? Would we be better off “tying up” more of our money?
In state or out of state?
Many upper middle income US OOS students will still be eligible for AccessUVa aid, because the annual cost of attendance is over 60K a year for many students.
Access UVa is 100% need based.
There may be some State-funded aid programs for in-state students that have some other criteria.
A family may also be eligible for AccessUVa aid if they have unusual necessary expenses, such as unusually high medical expenses.
Of course, athletic scholarships involves a separate pot of money.
in state…no athletics involved, definitely a AccessUVA scholarship. Like I said, I don’t know the particulars of their finances, just they appear to be doing quite rather well. I am pretty confident their income is greater than ours and their house is valued much higher than ours. But they may be cash poor.
It just made us feel like we were doing something “wrong” in terms of the Financial Aid forms or could be doing something else with our money. Kind of made us feel foolish for saving.
We have been quite disappointed with UVA in terms of financial aid. Their claims about meeting 100% of financial need seem to be cynical jokes. Reportedly they dedicated a portion of their “Strategic Investment Fund” to assist with tuition costs; yet, they do not seem willing to disperse those funds. Sadly, their own software (My inTuition) which is intended to estimate both cost and financial aid eligibility, is at odds with actual awards. Finally, federal requirements for aid have changed during the last year, permitting schools to use either 2015 or 2016 financial data to determine awards - it appears that UVA uses the year which results in the lowest award. In our opinion, a high interest, unsubsidized loan with immediate interest accrual (a loan which could be obtained anywhere without UVA “assistance”) does not really constitute aid. We have learned painfully that UVA has multiple criteria for determining which students are admitted and, then, which are really supported - most of those criteria are not public, for obvious reasons.
My D just received an AccessUVA need-based grant, and it was actually about $3000 better than the Net Price Calculator indicated. But we don’t have savings or own a home.
My interpretation of financial aid in general (not specifically UVa) is that each year schools expect to be paid a large percentage of student assets (maybe 30%) and a smaller percentage (maybe 10%?) of parent non-retirement, non-primary residence assets. Retirement assets and equity in your home may have an effect if they are fairly high amounts (like $300,000, and not $80,000).
So, yes, having a decent amount of savings hurts in getting financial aid. There are clearly some totally legitimate strategies that parents can do before children go to college that may help, like putting more in retirement accounts or in paying off your home, and less in savings or investments. I don’t know what the strategies are once students are in college.
I really didn’t expect us to get grants so when we first saw the loan offer it didn’t really surprise me. I was totally unaware of AccessUVa . Also I have run couple of different calculators and they all pretty much come up with a similar figure. But after learning of this other enrollee, it got me to thinking. And let me be clear, other than a scholarship offer from another in-state school, all the FA offers were similar from every other school my son applied to so not necessarily trying to single UVa out.
We will be alright, like I said we have planned and saved for this. But it does mean smaller vacations, tightening the budget, working more, etc which is a lot less than what most families have to do so not seeking sympathy. My main goal was not to saddle my kids with big student loans and I think we will succeed in getting them thru school with either zero debt or at least a very small amount.
Since this other student is so far the only kid I have heard of receiving it, maybe it was a fluke or maybe they are totally broke despite appearances.
If a student takes out about $20K total of federal student loans, that usually works out to about a $200 a month payment for 10 years. If they attend grad or professional school at least half-time, the payments are deferred by the feds. That is a reasonable amount of debt. (However, the proposed federal budget would require students to pay interest while they are still in college or grad school, but this is less likely to pass).
There are employers in some fields who will help their employees pay down their student loans. My daughter just graduated, and her new employer just said they will pay $10K of her loans if she stays for 3 years.
The goal should not be to avoid all debt for your students, but to avoid high interest rate private loans, and to avoid parents having to take out PLUS loans that have high costs and that can interfere with retirement savings.
Within reason, for most people seeking financial aid, it does make sense to try to pay down your mortgage instead of keeping large amounts in regular savings or non-retirement investment accounts. Also, putting money into 529 accounts or IRAs works more favorably than keeping large amounts of money in non-retirement accounts.
At the same time, you should maintain some type of emergency savings funds, if possible. A certain amount of non-retirement non-housing financial assets are allowed without being expected to be used for college expenses. That number is typically in the $40K to $50K range for a household, last time I checked.
Also, in regards to the original post - when you see someone with an expensive house, that may just mean they have much more debt that you do. Having a large mortgage or other large amounts of debt does not in any way help you obtain college financial aid.