<p>So, I just got a $22,000 scholarship from Tulane! I was wondering if they factor in scholarships when deciding upon financial aid? $40,000 tuition + $10,000 room is a lot, even with the scholarship</p>
<p>Sure, of course they do. They take into account your assets, and for attending Tulane (and attending Tulane only) that is a real asset, just like writing you a check for $22,000. Put another way, your family will have a certain EFC (Expected Financial Contribution) that is based on income and assets, including any savings you have. So if the calculations showed that your family could afford, say, $8,000 per year before getting the scholarship, they can still afford $8,000 per year and would be expected to pay that. Therefore at a total cost of attendance of about $53,000 or so, Tulane would be looking at an FA package for you of $53,000-$22,000-$8,000=$23,000. Now of course that is if they are going to meet 100% of your need and also, of course, the $8,000 number was completely random on my part. That $23,000 could be any combination of loans, work-study, and grants. Grants are a lot like scholarships except they are not guaranteed for all 4 years, which the scholarships are (assuming you make the grades and stay out of trouble). If your family’s financial situation improves, they will be expected to pay more and most likely the grant part would get lower.</p>
<p>It’s unfair but yes it does reduce finaid. Which of course reduces the incentive to look for scholarships if you expect to get need based aid. If you’re not expecting need based aid is the only case where getting scholarships will really help you.</p>
<p>I don’t see the unfairness. If you receive a merit award, you have less need. If you have less need, why shouldn’t you get less need-based aid?</p>
<p>It does mean that merit awards have more value for (and are more enticing to) students with very high expected family contributions. That’s true.</p>
<p>But would it be fairer to let a student with moderate need use up a whole pile of need-based aid and then stack his merit aid on top of that, so that he pays far less than his EFC while using up need-based aid that could otherwise support a different needy student?</p>
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Besides my basic disagreement with you that it is unfair to take scholarships into account as an asset, that statement of yours that I quoted is factually incorrect. A scholarship can greatly reduce the amount of loans a student might otherwise take out, or make a school like Tulane possible if they (wisely, in my opinion) want to make sure their loan burden doesn’t exceed a certain amount after 4 years.</p>
<p>But you should also be more careful to look at the dates of threads. You are responding to someone that posted almost 3 years ago.</p>
<p>I would also add that if scholarships were not taken into account and the same amount of financial aid was awarded based strictly on need, in theory a student could get paid to go to college! I know that wouldn’t actually happen and is an extreme extrapolation, but it does point out the unsoundness of your reasoning that a scholarship shouldn’t be counted as an asset.</p>
<p>Need-based aid usually has a self-help portion (loans, work-study, student savings), and typically scholarships can replace that. Also, most schools don’t meet full need, so scholarships can help fill the gap. So the answer is that scholarships will help, but perhaps not to the full advertised amount of the scholarship.</p>
<p>An interesting fact – at WashU, the school will not reduce your need-based aid until an OUTSIDE merit scholarship reduces your net cost below zero:
<a href=“Scholarships - Financial Aid | Washington University in St. Louis”>Scholarships - Financial Aid | Washington University in St. Louis;
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<p>But the subject is just as timely now as it was then.</p>
<p>True about the subject always being of interest, but he was actually answering the OP.</p>
<p>Another way of looking at it is that the scholarships don’t reduce the amount you pay immediately until the difference between total cost of attending and the scholarship is less than your EFC. But it will still reduce long term payments in most cases.</p>
<p>So if TCA is $50,000 and EFC is $20,000 then a $25,000 scholarship still leaves you paying $20,000 out of pocket, but only needing $5,000 more in FA. If the scholarship were only $13,000 you still pay the $20,000 but now you need $17,000 in FA and potentially that means higher loans. At the other end, if the scholarship were $40,000 then you get no FA but you only pay $10,000 out of pocket, saving $10,000. So unless you are attending one of the very few schools that promises no loans as part of the FA, a scholarship helps in all cases. It just doesn’t reduce the immediate out of pocket except in the scenario I described last.</p>
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I am not sure you can say that based on the link you gave:
An FA package is not the same as a scholarship. Not saying you are wrong, although I would be surprised if WUSTL considered a student’s EFC to be the same before and after receipt of an outside scholarship. I know for a fact they take into account WUSTL scholarships as part of the EFC, just like Tulane and every other school with which I am familiar.</p>
<p>@fallenchemist: you’re right, but only if your school’s fin aid package includes a lot of loans. If it’s all or mostly grant, then getting scholarships will reduce your grant amount. At which point you’ve got to wonder, why put in the time to warm scholarships. You’re only saving the school’s money…</p>
<p>In response to post #10:</p>
<p>I think you are right. Looking at the WashU webpage, they talk about financial aid and about scholarships, and it appears that need-based aid falls in the first category, not the second.</p>
<p>SoCalDad - Yeah, it is kind of the lingo used, that FA means need based.</p>
<p>pde54003 - That’s true that if you win outside scholarships and your FA package is all or mostly grants, it helps the school more than you from a strictly financial point of view. For the student it’s a wash. But to answer your question about why do it, I guess there are two reasons that come to mind. No wait, actually 3.</p>
<p>1) Usually you apply for those scholarships before you know your FA package, often well before. So you kind of have to, in order to hedge your bets.</p>
<p>2) The school can change their package from year to year with regard to grants vs. loans, and of course reduce the amount of FA in total. Many scholarships are fixed amounts as long as you maintain a certain GPA or whatever other conditions they put on them, so there is a certain stability factor.</p>
<p>3) There is a prestige factor for your resume to say that you won the So-And-So Scholarship, especially if applying to grad schools or professional schools. It is probably a small factor in most cases, but still. Of course there are a few scholarships that are nationally recognized as being great achievements.</p>
<p>@fallenchemist: Point taken. You won’t know your FA package for sure, but bet price calculators give a good estimate. And if they don’t, why the hell ate they there? Also I think most scholarships are a set amount, although the bigger ones are admittedly multi-year. The grad school point is good, but making the assumption that everyone who gets a scholarship is going to grad school or professional school is more than a little elitist. Yet you admit that from a financial standpoint the scholarships can help save the college’s money rather than the student’s, which rather defeats the (primary) purpose of scholarships. So you have to admit that this reduces the incentive for some students (at well-endowed colleges) to search for scholarships. The frustrating bit is that many students don’t know this until it’s too late.</p>
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The grad school point is good, but making the assumption that everyone who gets a scholarship is going to grad school or professional school is more than a little elitist.<a href=“bolding%20in%20this%20and%20the%20next%20quote%20are%20mine”>/quote</a></p>
<p>Well, first of all I didn’t assume anything of the sort. I said IF very clearly. Second, I cannot at all see how it is elitist, it is a subset of the people that go to college. Third, I also clearly said “especially”, which means not exclusively. I think it carries a subtle but important message if you can put on your resume to an employer that you received XYZ merit scholarship, especially if you can then work it into the interview that it covered all of your tuition, half your tuition, or whatever.</p>
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No, when coming from an outside source it saves both money. If the Rotary or 3M or Intel are paying for it, the student obviously is still paying less than they would absent either the school or the outside source, and the school is taking advantage of another agent choosing to subsidize that student. What you are trying to say, I think, is that since the school was willing to part with that money anyway, why not let the student have both, at least up to the point where it doesn’t exceed full tuition or full cost of attendance.</p>
<p>This, I think, is a false way of looking at the role of the college. They may be non-profits, but they are not charities. Except for a relative handful of schools that have huge endowments, budgets tend to be very tight and like most companies, they also look for savings where possible. Even Harvard, which has the largest endowment of all at $35 billion+, instituted budget tightening recently. It is also a very expensive school to run.</p>
<p>It has always been a norm in this country that it is the responsibility of the individual and/or their family to pay whatever they can afford for college. Now that, of course, is the loaded phrase: “whatever they can afford”. That is a huge debate that I don’t think we want to get into on here. But the model at this point is that the EFC is going to be paid by the family absent a scholarship that leaves less than that amount in accounts receivable.</p>
<p>As to whether there is incentive to get that money from the outside rather than count on the school to provide it, I have given my reasons for thinking it is a good idea. I would only add that it is always a good idea to diversify your potential income streams, especially when you are talking about amounts this sizable. I feel a lot better knowing my D’s full tuition scholarship is part of a guaranteed merit package as opposed to an FA package that gets reviewed every year.</p>
<p>Just looking at this again, I thought of something regarding
I have no experience with these net price calculators, but I guess I always assumed that while they will present you with a total amount of need-based FA one should expect, they don’t tell you how much will be in grants vs. loans vs. work-study. If I am correct, that would be another reason to go for outside scholarships, unless you assume that the school will always take the money out of the grant part and leave the loans the same. But I am not at all sure one can make that assumption. After all, they are trying to be competitive, in theory. Otherwise they might as well always minimize the grant portion, and I see no evidence that the highly competitive private schools such as Tulane do that.</p>
<p>To clarify, most net price calculators do break down the specifics with X amount from, Y from work, and Z from grants. Each school’s policy varies on which to reduce first. In all situations though, outside scholarships do reduce FA rather than EFC. Let’s take a hypothetical. Someone gets into Happy U, and they get 5000 in school loans, 5000 in on campus work, and 10,000 in grants. Say they have 10,000 in outside scholarships. In the best case situation the school will reduce the loans and work. Now say that student has a chance to earn another 2500 scholarship. There are a couple of essays to write, the student will need a rec letter. Will that student really spend the time to get that scholarship if his school will reduce his grant aid by 2500 if he does? He can spend that time doing other things; the “opportunity cost” of that scholarship is too high. </p>
<p>Your situation is a little different I think with a full or half tuition scholarship. But most people are getting much smaller scholarships, maybe two or three of a couple thousand a piece. Can’t you understand their frustration when their scholarships aren’t reducing their EFC? Of course the bigger problem is that so many people don’t even know about this situation. I understand what you’re trying to say, but I hope you can understand the difficult situations of students who aren’t fortunate enough to have full tuition scholarships.</p>
<p>Sure, but of course everything in life is a value calculation. Well, maybe not everything, but you know what I mean. I certainly do agree that a smallish scholarship (and I do agree that a lot of the outside scholarships are smaller ones) may hardly be worth the effort, and maybe not at all if the school is just going to take it away from the grant portion of the scholarship. As I said, the “prestige” factor is probably rather small and the others become less significant for small scholarships.</p>
<p>I still don’t think the answer is to reduce the EFC per se, but instead that the schools should guarantee that the first thing to get reduced from the aid package is the loan portion. Has the same approximate effect without upsetting the current model of how the schools view financial responsibility. Some cases won’t benefit as much, but they should be relatively few. Most would get the benefit of having loans reduced.</p>
<p>Thanks for the info about how the npc’s present the results. Like I said, I have had no personal experience with any of them.</p>
<p>I can see what pde is saying now that he has spelled it out so clearly, but I am wondering if the financial aid people at the schools to which a student is applying might disclose their policy as far as the application of outside scholarships to the financial aid package if asked. I would have assumed that the scholarships would go toward reducing loan amounts first, but I don’t have any experience with financial aid. I wonder what the proportion of schools who reduce grants first is compared to loans. I also wonder what Tulane’s policy is as far as that goes. Maybe some of the “regulars” here could shed some light if they have personal experience that might apply to this situation.</p>
<p>@fallenchemist: A calm, reasonable conversation on an Internet forum, I never thought I’d see the day!</p>
<p>I don’t know about Tulane specifically, but a lot of the more prestigious colleges (US News top 25 or so) will reduce loans and work “aid” first.</p>