What we understood after a discussion with a FA representative at one of the schools DS was accepted into:
(1) When an elite school claims all financial need is met, they mean “all financial need” as they deem, not what is indicated bu FAFSA. In our case, the difference was over $15,000, and that’s NOT including the $12,000 DS would have to borrow as a subsidized loan, or work/study.
(2) When an elite school says that their students graduate with $30,000 or less in student loans, they mean the “Student” graduates with that, as in, that $8,000/year or so was part of their FA package, as subsidized loan. It does not mean that, if the cost of 4 years of college is 240,000, and the student debt was 30,000, the student was awarded 210,000 in grants and scholarships; more like, it was deemed the parents were wealthy enough to pay that amount, or close to it.
(3) In our case (we have twins), the amount they expected as parental contribution (for both the kids) over a period of 4 years was almost exactly the same amount we declared as our non-retirement account/ residence assets: Stocks, bonds, mutual funds, 529s, the paid-off part of an investment home, etc. We’re not sure if it was just coincidence.
(4) Colleges separate a parent’s financial obligation from a student’s, which was definitely not how we saw it.
We don’t expect a close to free ride for our kids- But we’d read all these articles on how students graduate from elite schools with peanuts in debt, and always thought that not everyone who goes to these schools is wealthy, so their need was actually met, not that the parents forked over a quarter million! And I know several parents like me, who had a very high opinion of schools’ ability to ensure their students wouldn’t be weighed down, solely based on articles like those! So, yes, I was naive to infer that, luckily, the kids won’t be impacted by my naivety!
QUOTE=Essel When an elite school claims all financial need is met, they mean “all financial need” as they deem, not what is indicated bu FAFSA. In our case, the difference was over $15,000, and that’s NOT including the $12,000 DS would have to borrow as a subsidized loan, or work/study.
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Yes, each college may calculate its own EFC for your financial information, rather than using the FAFSA EFC.
That is why you need to run the college’s net price calculator to get an estimate before applying to the college.
Now, there could be other issues (that college’s net price calculator is of low quality, or the family finances are complex with issues not properly accounted for by that college’s net price calculator – commonly divorced parents, income from small business or real estate, etc.), but the college’s net price calculator is much more relevant to financial aid at that college than the FAFSA EFC or any subjective claims about the college’s financial aid.
QUOTE=Essel Colleges separate a parent’s financial obligation from a student’s, which was definitely not how we saw it.
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Yes, colleges typically expect a student contribution of work earnings and/or federal direct loans (total usually between $4,000 and $10,000) in addition to the parent contribution (although a given family may allocate the total net price differently between student and parents).
It would be nice for new “buyers” to the market to be able to see consistency among schools, or consistency of what to expect based on EFC without using the NPCs which can be off. It is not intuitive at all!
But we will have to just put that on the list of ways we would do it if we could start from scratch developing an admissions process.
It is the silver lining of getting no FA: no forms to fill out and i have certainty:)
“But we’d read all these articles on how students graduate from elite schools with peanuts in debt, and always thought that not everyone who goes to these schools is wealthy, so their need was actually met, not that the parents forked over a quarter million!”
@Essel,
There is a great deal of misinformation out there… all these mythical “full scholarship to Harvard” stories when, in fact, Harvard doesn’t offer scholarships!
And yes, there are A FEW schools that meet the full need of the students THEY WANT. In other words, a handful of schools are very generous to a highly select group of students who, in many ways, are extraordinary. The rest pay. Yes, up to a quarter million per kiddo.
All those articles you mention failed to specify these nuances. Because nuances don’t sell papers.
You have a LOT of assets…investment home equity IS considered an asset just like money in the bank. So is a portion of the equity in your primary residence at some colleges. You have stocks, bonds, mutual funds, and 529 plans…all assets. Assets DO contribute to your family contribution…and you have a good amount of those…congratulations?
Oh…and this doesn’t even include your income as a contributor to the family contribution for college.
I guess my question is…did you think your twins would get need based aid?
Did they or will they apply to colleges where they will get merit aid to soften the financial burden for you? Did they apply to your instate public universities which don’t cost $60,000 a year?
If your kids got significant merit aid…or went to a public university that costs $30,000 a year…it seems to me that with your assets, and probable income (since you don’t mention receiving any need based aid) that your kids could also graduate with less than $30,000 total in loans when you add in your 529 contributions per year…and some contribution you parents make annually plus the Direct Loan amount.
You did not mention your income which has even more significant contribution to the EFC. For families that gave less than their annual income in fluid asset, that can be easily depleted in 4 years college education expenses if you don’t factor in your income.
In my family’s case, the EFC as calculated by every single college someone got into was less than the FAFSA EFC. We are upper middle class, but not so much so that we have an investment home.
The FAFSA EFC is just for federal aid eligibilty. In some cases schools will only consider FAFSA EFC for need based institutional grants, and state aid can be based on FAFSA EFC.
For schools requiring CSS profile or their own forms, they will determine your need with that.
And not all schools with meet need without loans.
I think a big part of the problem is with the phrase “Expected Family Contribution.” It’s very misleading. They should come up with a different phrase, or perhaps a numerical score that is not a dollar amount.
For THIS family…it seems the school calculated family contribution was higher because of items NOT included on the FAFSA…primary home equity jumps out as one.
Also, wondering if this OP is self employed…because THAT throws a curve ball when doing the net price calculators as well.
I’m not clear whether this OP even DID those net price calculators. Especially for Profile schools…or schools using their own forms in addition to the fafsa…the net price calculator gives a closer look at net costs.
I think everyone wishes their kids would get more need based aid. But with substantial income and assets, this just isn’t going to be the case.
OTOH…schools where merit aid could be had…or instate public universities could easily make college costs $30,000 a year vs $60,000 a year or more.
Are your twins juniors or seniors?
Did you know of NPCs and run them?
Did the twins apply to schools in common?
Have they applied to universities where they may get merit?
If you haven’t run the NPC yet, can you do so for each college (they all calculate differently so you do need to run it for each. Since you have twins don’t forget to check ‘2kids in college’.)
An issue is that Americans all think they’re middle class, even if they earn 250k or more. So when they see something about financial aid for middle class, they don’t think " oh, middle class in this country is 55-120k income, I don’t qualify’, but rather that it applies to them; then parents are dumbfounded to see it didn’t. The NPCs were supposed to help with that and I’m always surprised to see how few parents know about them and run them junior year or even senior year before the list is finalized.
Fortunately, there’s CC, for those who can find it.
Ugh, I hated doing the yearly FAFSA but after doing it for 10 years, I could do it in my sleep. At least only one school required the CSS was far more detailed and IMO, personal. Since that school was in the same town that I live in, there was absolutely no fudging on home value or anything since they knew where you bought your cars and about how much you would have paid for it, what the homes were worth by area of town etc. It did work to my advance because I had to replace a fairly new roof. I just told them the brand of roof, that it was defective and the company was out of business and where it was purchased. I figured if they questions, they could just call the building store in town and ask if they had sold that brand etc. One school that my oldest applied to required a copy of of your tax return before they sent out the financial aide package. The other two kids, all their schools ever wanted was the FASFA. The youngest had figured that by the time she was ready for college that we wouldn’t have any money left so she did everything she could to get as much financial aide possible. When she was applied to school she played for sale to the highest bidder. She ended up at the school she wanted for less than living at home and commuting to the state university in town. Her package from honors college included merit aid, talent scholarship, alumni scholarship, university grant and fed loan. We were left with the remainder of room and board and books.
Years ago, schools used to reduce your financial aide your third and fourth year figuring your stuck there, to late to transfer and your friends are there. So parents had to shell out more money so that you could finish in 4 years. With youngest they actually gave her two additional scholarships her last year.
One thing that I did learn is the a lot of schools have less work study jobs than students that qualify for them. When I had 2 in college for a few years, they would be eligible for work study jobs. They never earned the amount of dollars that they were eligible for either since either the number of hours they could work wasn’t available or they could fit that number into their class schedule. Some schools do not let you work more than one work study job unless all of their work study eligible students have a work study job, then you could pick up a second one. At all three schools that mine went too, they couldn’t pick up that second job since there were more students than jobs. I never counted work study as a given when figuring the costs.
I never figured out how the schools figured their financial aid since none of them ever matched the need shown by FAFSA. If they lived at home and commuted, then they reduce the financial aid. If they worked an off campus job for pizza, gas and book money, then financial aid was reduced.
Years ago, one of my friends had been orphaned at a young age. She was raised by her grandparents on a farm. When money got tight and she requested more financial aid, she was told to sell some of her land. I don’t think schools have changed much in that reasoning. Anything extra (above what the average person would own) you can sell to pay for college, seems to be their mindset.