<p>Came across this recent CBS news story, much of which is not news to CC regulars, but there were a few bits of advice that seemed less mainstream and worth considering:</p>
<li><p>Be sure to ask hard questions about merit scholarships, particularly the terms for renewal and % of students whose awards are renewed.</p></li>
<li><p>Calculate college expenses based on a 5-year model, since a majority of students do not graduate in 4. </p></li>
<li><p>Upper income families may do better to take a second mortgage (because it’s deductible) than to borrow.</p></li>
<li><p>If you appeal your financial aid award, travel to meet with the FA officer in person.</p></li>
</ol>
<p>I'd like to point out a few nuances or clarifications, though:</p>
<ul>
<li>The fifth year. While it is true that many students take more than four years to graduate, it is not too helpful to project costs over 5 years when factoring in financial aid. That's because the aid is not likely to continue beyond 4 years, even if the student does. Most colleges expressly limit their awards to 4 years or 8 semesters, and there is also a limit as to the total amount of federally subsidized aid available. So if a parent really is worried about that fifth year, then rather than subtracting out grants and multiplying by 5 as the article suggests, the parents would need to assume that year #5 is at full cost. Of course, need-based financial aid tends to be weighted more heavily toward loans and work-study during each year of college, and the student's expected contribution from summer earnings also increases -- so parents also need to factor in the fact that need-based grants are likely to be reduced each year. Finally.... tuition and other costs keep going up, and up... though often some typical first-year expenses, particularly housing & meal costs, can be reduced somewhat in later years through various strategies.</li>
</ul>
<p>Personally, I dealt with the "fifth year" problem by making it clear to my kids that the fifth year, if any, is their problem. </p>
<ul>
<li>Traveling to discuss financial aid. For those of us who live hundred or thousands of miles away from the colleges our kids want to attend, this doesn't make much sense financially. Not only is travel expensive, but it can also send mixed messages about the parent's finances. (If the parents are having such a tough time financially that they need to appeal, how come they were so eager to jump on a cross-country flight?) A phone call can be a reasonable substitute. Actually, a phone call can sometimes be better -- I learned this year after a very long phone call that my daughter might be able to get her grant increased, if I could provide written documentation of an expense I discussed with the financial aid officer. From home, I was able to quickly pull the records I needed and fax them to the financial aid office --a parent who has traveled far from home may also be very far from the documentation needed to support a case.<br></li>
</ul>
<p>I would note that if the kid is traveling to the campus alone for an admitted-student event, that can be a good time for the student to discuss aid. I made sure that my daughter had needed documentation in hand when she went to talk to the financial aid officers at one college -- she did fine, and "won" the appeal with an increase in grant -- even though the end result was still not enough to meet our need. (But that particular college is notorious for its poor financial aid -- I'm quite sure that my presence wouldn't have made a difference).</p>
<p>Hope and Lifetime learning credits are not refundable tax credits and cannot be taken until after the expenses for the year have been paid.</p>
<p>I am not sure who the writer spoke to before compiling her list, but it is clear to me that it wasn't someone with a lot of financial aid experience.</p>
<p>FWIW--federal financial aid (Pell grants, subsidized STAffords, etc) cover six years (12 semesters). State grants vary. I believe that NJ TAG grants, for instance, cover 9 semesters. School grants also vary.</p>
<p>At the school I work at, most students take 5/6 years to graduate, and most do get at least some aid for the sixth year, and decent aid for the fifth.</p>
<p>If most students were taking 5 years to graduate, and no one was offering aid for the fifth year, no one would be graduating. Check into school and state regulations to find out what's available.</p>
<p>But, if at all possible, plan to graduate in 4 years. The students who don't either tested into remedial classes or failed classes along the way. Some also opt out for full time classes because they need to work full time, they have family obligations (like kids) or medical reasons. Few actually take longer because of class availability. Most CC kids are not the ones on the five year plan--very few of their parents are hanging out here. CC students are usually the lucky exceptions (mine included.)</p>