<p>I've done the caluclators using FAFSA vs. institutional methodology and there's a difference of $6000, with the latter being more generous (lower EFC). Is this typical? Many of the top private colleges seem to use the institutional methodology. I'm curious if people have experienced better need-based packages from these schools because they define need differently.</p>
<p>Does institutional methodology give a school a little leeway in terms of sweetening the pot for some kids, even though they still label it need-based aid? Has anyone had significant variation in financial aid from these top need-based aid only schools?</p>
<p>IMHO, the institutional methodology definitely gives some leeway depending upon the school.. Schools with deep pockets as far as resources, have more money to give and seem to be on a mission to make college affordable (sometimes there is a disconnect where what families and schools beleive is affordable). Many schools that have institutional funds also require that you provide the CSS profile which gives a bigger snapshot of your financial situation than the FAFSA.</p>
<p>The EFC that was calulated for my D las year at williams was thousands of dollars lower than the FAFSA EFC. The EFC at most of the other schools that she applied to that meet 100% of demonstrated need and also gave good grant aid, we found our EFC was lower than what the FAFSA gave us. Hoping that this trend continues as se is going into sophmore year.</p>
<p>Now that 's funny, because I found the exact opposite. When I ran an estimated EFC, the institutional method had us paying about $6000 more than the Federal. Interesting.</p>
<p>upon the school. None of them explain how they use the information in the FAFSA or the CSS Profile. It was my sense that the schools used whichever EFC was higher and did not provide an explanation. Though this is not true everywhere.</p>
<p>The financial aid component of the college search process is an art not a science. That is the reason I will not let my children apply ED to any school. I know this is a bit off topic but I also do not see how a student can 'agree' to attend a particular school without some of the details of the agreement determined, i.e. financial aid.</p>
<p>With that all said, I did like the financial aid calculator on the Princeton web-site. I understand that what it spits out is pretty close to what a student will receive. Note, the number did not match either of my EFCs but was closer to the Institutional EFC. Which in my case was lower than the FAFSA EFC . . . a good thing. However, my son didn't apply to Princeton, it didn't feel right to him.</p>
<p>If you want more information on what goes into each methodology, you can see my blog for more info (click on my name and you can go to the web page, under the section entitled "How We Determine Your Family Contribution").</p>
<p>I will say that it is possible this year that there will be many more cases where the Institutional Methodology is lower than the Federal Methodology (we use a particular brand of IM called CA), especially given the recent update to the Federal tax table.</p>
<p>Schools who use IM (or CA), though, are under no obligation to use the IM figure if it is less than the FM figure. As always, my advice would be to inquire as to the school's practice. Some may award to IM level always, some may raise IM to match FM if necessary, some may only award to FM, or some other combination.</p>
<p>As to why one might be higher than the other, some likely culprits may be state tax allowances, medical allowances, private elementary or seceondary school tuition expenses, families with young children (any or all causing lower IM than FM), or high home values, negative income components, business depreciation (any or all causing IM to be higher than FM).</p>
<p>As for Princeton's calculator (or any of the calculators out there), be careful, since they only represent the choices that the school or body presenting the calculator makes. There are many options in IM, and each school may choose different ones (I could spend 30 minutes just writing about how many different ways homes could be look at).</p>
<p>barkowitz, I was referring to the Princeton University web-site, not Princeton Review. I understand that students who apply to Princeton and get financial aid get something pretty close to what the calculator tells them they would get. However, they do not tell us what methodology they use. Is there a simple online calculator like the one at SmartMoney for CA?</p>
<p>I will check out your blog. Thanks for the post.</p>
<p>No, there really isn't a simple online calculator you can use for CA (or for IM for that matter). I knew you were referring to Princeton University's calculator, and while Princeton's calculator is great for students going to Princeton (or looking at Princeton), I would just be careful assuming that the contributions will be the same or even similar school to school. The best bet is to ask schools if they have any information about their formula and/or just to apply.</p>
<p>As a 'consumer', my issue is the difference from school to school in how need is defined. USNews just confuses it further when they report what percentage of 'need' is met by each school. It just seems to me that 100% at one school would be 110% at another.</p>
<p>BTW, thanks for the blog, it is quite helpful defining how MIT calculates financial aid. Now if I can just get my son in. ;-)</p>
<p>Institutional method (John Hopkins website) tells me that I have to pay 9k more than than the federal method. I guess they take my parents 401 contribution as untaxed income and home equity as asset. My parents worked their butts off to save money for their retirement. According to JHU calculator my parents have to contribute 30k each year and I am not willing to apply early decision because of that. I think I have a good chance getting into JHU. :(</p>
<p>
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I guess they take my parents 401 contribution as untaxed income
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FAFSA will also take the base years 401K contribution as income - it has to be added back on worksheet B (tax deferred income). They do not consider the 401K balance as an asset but do consider the contribution that tax year as income.</p>