I’m seeing 2 different schools of thought researching merit aid chances when applying early decision. One side says you have a better shot at getting $$ because those students get awards before schools have exhausted the pool with RD applicants. The flip side is that there’s no need to throw cash at an ED applicant because they are a sure thing, so schools may save scholarships to entice more RD students. Anyone have thoughts or personal experience to share?
The school my son is looking at meets 100% of need, so maybe worrying about merit aid is a moot point. If I’m understanding things correctly, if the difference between our EFC and their sticker price is, say, $30k, and the school would give him that amount in a grant, any merit aid would come off of the top? So, if he’d get a $15k scholarship, it doesn’t mean our contribution would be less, it means he’d get a $15k scholarship then would only need a $15k grant to make up the difference.
No, your contribution would not be less (it remains the same).
If your son has 30k in need and receives a 15k merit scholarship, he will now only need 15k to make up the need. If the school meets 100% demonstrated need, the need may be met by a combination of grants, loans, work study (not federal work study)
At many schools that meet full need, merit aid (if offered) is highly competitive, because all of the applicants are highly competitive applicants.
None guarantee merit aid awards.
If your son is truly a competitive applicant for these schools, he might also garner significant merit aid from other places.
Are finances a significant issue? Can you afford to pay your calculated family contribution (these schools calculate the family contribution…and the vast majority use the Profile in addition to the FAFSA to gather financial information)?
If finances are not an issue, then fine, apply ED. But if you really want to be able to compare awards…merit and/or need based…perhaps RD is a better option.
I thought we could make our EFC work, but I just learned about this school using Profile today, so I’m worried our cost could be more than I originally calculated. RD might be the way to go. He’s just impatient and wants to find out ASAP…March seems like a long ways away.
Some schools allow merit scholarships to replace loans and work study in the normal need-based aid package before replacing grants. Not all do so (or may do so for some scholarships but not others), so check each school for its policy on that.
An example if the school replaces loans and work study first:
No merit scholarship:
$60,000 = list price
$23,500 = need-based grants
$30,000 = institutional EFC
$ 3,500 = federal direct loan
$ 3,000 = work study
$30,000 + $3,500 + $3,000 = $36,500 = net price
$15,000 merit scholarship:
$60,000 = list price
$15,000 = merit scholarship
$15,000 = need-based grants
$30,000 = institutional EFC
$ 0 = federal direct loan
$ 0 = work study
$30,000 + $0 + $0 = $30,000 = net price
In the merit scholarship scenario, the first $6,500 of the scholarship reduces the loan and work study amounts, while the $8,500 remaining reduces the need-based grants.
Our income is much lower this year compared to last. But I saw that Profile looks at 2 years of returns, so I hope that doesn’t negatively impact anything. Also, it was probably my own mistake when entering info for the NPC, but reading through everything for the profile I realized I hadn’t included stock options as an asset, which will probably bump our EFC up as well. Then reporting 401k balances and home equity makes me feel penalized for saving money/paying down the mortgage.
It’s kind of a roller coaster: Look at that sticker price! We can’t afford that! Wait, the calculator says we’ll only owe $X max at any school…go ahead and choose your favorite. Oops, screwed up, we might actually have to pay $X and that’s too much debt to take on, sorry–cross your favorite off the list.
He is applying to other schools with EA. I wish everywhere had that option.
For Profile, the earliest tax return and the 401(k) (and other qualified retirement plans) balance is, in almost every case, used for informational purposes only and is not figured into the aid calculation. Also, some Profile schools do not use home equity in the aid formula, and of those that do, many use it in a limited way.