<p>Can someone kindly tell me how this might work? </p>
<p>Our EFC is above the cost to attend a few colleges on my child's list. We have the cash to meet the full cost. However, my child meets the automatic merit aid criteria and perhaps will be able to get talent merit as well. Will we still be expected to pay the full tuition or will the total cost be reduced because of that merit aid?</p>
<p>In my daughter’s case, merit aid was merit aid (especially for the automatic awards). It’s how many families work to make schools affordable in light of a high EFC. I am sure that each school has its rules on how awards are parsed out, but this can be a very wise way for a student to leverage high grades and test scores into financial help for college. If she has very high stats, I would also recommend that you look into any scholarship competitions that the college itself holds.</p>
<p>Yes, merit aid will generally reduce the high EFC. My d got a merit award that did not depend on financial need; that money came right off the top of tuition.</p>
<p>Yes. Our EFC was above the total COA for the school my D attends. She got a full tuition merit scholarship (automatic based on stats) plus another award, so we’re paying only a fraction of that COA. Merit aid is very different from need-based aid and EFC isn’t a factor for true merit aid.</p>
<p>Thanks guys this is great news. </p>
<p>I just realized that this is an example of why if families are saving for college some of the money might be better off not in a 529 fund. That way if they do get merit aid and have money left over in a non 529 college fund they can use it to start their new life.</p>
<p>Merit aid does not reduce the EFC. Rather, EFC is used only for need-based aid. It is determined using FAFSA and ignores all outside scholarships.</p>
<p>Perhaps what Chedva meant to say was that merit aid will reduce the out-of-pocket money coming from the family.</p>
<p>As a example, based on the OP, let’s say that State U COA is $22k and a family’s EFC is $25k. This family would not be eligible for any need-based aid at State U. However, if the family’s bright student earned a $10k merit scholarship from State U, then the family would only need to pay $12k (=COA($22k) - Scholarship($10k)). EFC remains unchanged at $25k, but the family has less money taken out of its pocket for State U.</p>
<p>I think some clarification is needed.</p>
<p>Merit aid usually ONLY reduces EFC if the merit is sooooo big that it covers NEED and then cuts into EFC.</p>
<p>however, if the merit is too small to “cut into” EFC after applying to need, then it won’t reduce EFC.</p>
<p>For example.</p>
<p>COA = $50,000</p>
<h2>EFC = $20,000</h2>
<p>Need - $30,000</p>
<p>So, to reduce that $20k EFC the student would have to get a merit scholarship that is MORE than $30k so that it covers “need” and then cuts into $20k.</p>
<p>^^Unfortunately, there’s Fafsa EFC and there’s EFC. We need a new term for what the college expects the family to pay. Fafsa is neither the only tool colleges can use, nor an indicator of what the college’s family “expected contribution” will be. It’s a starter number, for fed aid purposes.</p>
<p>mom2collegekids, that’s true if your EFC does not approach or exceed the COA. If you’d be a full-pay family, then merit aid truly does reduce the amount the family pays. It becomes a credit against the COA. (EFC = $55,000; $50,000 COA - $20,000 merit; family pays $30,000.)</p>
<p>stacherry, the most important thing to look at when comparing merit aid offers is the requirement to keep the merit aid. Is it renewable for all four years, or does your student have to reapply each year? If it is renewable, is there a GPA requirement (for example, the student must maintain a 3.5 GPA to keep the scholarship)? If it is a GPA requirement, is it just in courses for the major, or all courses? If a student drops below the GPA, how long does the student have to get the grades back up? What are the credit requirements to keep the scholarship?</p>
<p>Some schools have very rigorous requirements. Some schools only require “satisfactory progress,” which is what a kid would have to do to advance to the next year anyway.</p>
<p>Many kids, particularly in majors like engineering, have found themselves suddenly full pay because their grades dropped too low.</p>
<p>Just make sure you and your student know what the landscape looks like when making any decisions about where to attend.</p>
<p>Thanks, </p>
<p>I think I got it and I should not have even used that EFC. I should have said total coast.</p>
<p>Thanks guys. I’ve gotten more useful and important info then I even asked for. CC is the best! I hope to pay it forward!</p>
<p>*Unfortunately, there’s Fafsa EFC and there’s EFC. We need a new term for what the college expects the family to pay. Fafsa is neither the only tool colleges can use, nor an indicator of what the college’s family “expected contribution” will be. It’s a starter number, for fed aid purposes.
*</p>
<p>True…but that’s one of the benefits of large merit. YOU then control what your “EFC” (as long as the student meets the scholarship req’ts)… </p>
<p>That said, one of the confusing aspects of merit is that some people think that their need will be met with “need based aid” and then they can use merit scholarships to reduce what the family is supposed to pay. </p>
<p>Beth’smom is a good example. Since their EFC is beyond COA, then those Full Tuition PLUS merit scholarships that her D received means that their remaining costs are likely below $15k per year. :</p>
<p>Chevda…yes, for full-pay or near-full-pay families, even a modest of merit can reduce what the family has to pay. :)</p>
<p>EFC is simply a number used in computing financial aid. If a family does not qualify for need-based financial aid, the EFC is irrelevant (completely and totally).</p>
<p>A merit scholarship that is awarded based on merit only (with no ties to “need”) is money that reduces the direct cost to the student.</p>
<p>An EFC higher than the direct cost to the student means nothing other than “this student will not be able to receive any need-based aid.” That means no SEOG, Federal Work Study, or subsidized loans (and no institutional need-based aid). It doesn’t mean anything else.</p>
<p>The cost of the school is the cost of the school. The school might cost $50,000. A student with an EFC of 65,000 would still only pay $50,000. </p>
<p>If the student with the EFC of 65,000 got a merit scholarship of $20,000, the direct cost to the student would be $30,000 … because EFC is irrelevant in this case. A student with an EFC of 0 would pay whatever financial aid doesn’t pay.</p>