<p>^^ similarly, if a grandparent or other outside family member wants to help with EFC to ease family burden or even make EFC possible without outside loans many schools like to attribute that towards reducing need as “other resources” on Profile.</p>
<p>^^^^ that is the bleeding thing I was talking about!!!</p>
<p>Perhaps because our kids are first gen college, but we always expected to have to meet college expenses ourselves. We never got the idea that the schools have oodles of money that they are just dying to cover student expenses with.</p>
<p>One thing I do wish was easier to manage was identifying outside scholarships that are worth applying to. Technically any extra bit helps, but some scholarships are more attainable with fewer other applicants, while others are highly competitive for even the most accomplished students.</p>
<p>High school counselors either have too many other fires to put out to be a great financial aid resource as at one daughters inner city high school. or as at her sisters private school, I don’t recall the issue being raised, most families could pay their EFC and the primary motivation for scholarships may have been prestige.</p>
<p>It should be noted that most outside scholarships have demonstrated financial need as a condition of award, so full pay students, even those who just barely miss qualifying for FA, generally can’t apply for them. Reducing need-based aid when a student brings money to the table doesn’t feel fair, but is it any more fair to allow FA qualified students to reduce their EFC when full pay students whose families might also be sacrificing to send their kids to college can’t?</p>
<p>OP, have you considered trying to negotiate with the school? See if they will “review” D’s FA package.</p>
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<p>Actually in order to reduce the EFC with private aid, one needs to be full pay. Looking at the formula explains why this is not a discretionary event as the total of need and EFC would exceed the COA. </p>
<p>It is good to remember that the basic theory of financial aid is that the primary source and primary responsibility are the students and the parents. And the EFC is pretty much the floor in many cases, and always in all cases of need based aid.</p>
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<p>I’m sorry you can’t count on your ex, suzy100. That puts you and your child in a tough situation, no question. You mention schools that don’t require noncustodial parent information; for someone in your boat, those are necessarily the schools you have to look at (along with others where your kid’s stats put her in line for the kind of merit that would cut into EFC). I gather that it is possible to get noncustodial parent waivers but that it is rather difficult to do so. Colleges would really be in a bind if they were expected to account for the sad reality that some noncustodial parents are not willing to contribute their fair share. Talk about shocking—noncustodial parents who won’t contribute is the definition of “shocking,” IMO.</p>
<p>xiggi-I guess it all comes down to how you want to determine EFC. You seem to think that that money has to come directly from the bank account of the family. I would like to see that definition as whatever the family can bring from outside of the institution, which would include private scholarships. Most people here recognize that the EFC is not achievable for most especially if you add in that most schools don’t give aid up to that EFC so not only does the family have to come up with those dollars, they have to come up with the unmet funds as well. With state schools heading north of $20,000, how realistic is it that the average to above average kid is going to be able to afford college much longer? Even the middle to upper middle class families are being priced out of college, rapidly.</p>
<p>I worry for people. I don’t think “younger” college age parents have saved much. Some of us “older parents” were raised by depression era parents so saving was inground in our upbringing and we psychologically are closer to our parents financial thinking living alittle below our conventional means, buying a house and paying the mortgage off and not trading up etc. and saving more than 20% of our salaries year in and year out than some of our younger peers who were raised in the good times. We have actually had friends who are a decade younger than us flat out tell us they have no savings. Our savings are far less strong than a 10-15 years ago what with the multiple recessions hitting savings and sending 3 kids to college at all time high costs and two years of zero income during the height of the recession. I don’t know what is “realistic” to expect college costs to be in 5 years when some of these younger families are in the middle of the college cash drain. We’re just holding onto our rear ends knowing we are half way through college costs with 6 more years to go and hoping costs have stabilized. We’re at the max that we had planned for back in the late eighties… if they continue to rise it’s going to be scary. Then absolute darndest thing is our EFC rises each year even though income has gone down slighty (took a reduced income job after the 1.5 year unemployment period) and our assets clearly are depleted and we are older. I wish someone could explain that one to me in language I can comphrehend. I was shocked at our EFC this year even though it’s meaningless.</p>
<p>Steve, I am afraid that the definition of the EFC is not subject to different definitions. The EFC is actually so clearly defined through a lengthy albeit clear formula that anyone can compute it to the penny. The EFC is the result of the government imposed formula. There is, however, a possibility that school officers to override part of it through professional judgment. Then there is the matter of the family contribution defined by the CSS/Profile. That EFC is actually a misnomer.</p>
<p>I do, however, understand that your point is not a technical one. You might not agree with the formula in the first place! I am not here to defend the system; I try to express the view that the way it works is not that nebulous or capricious. When I was 17, I was able to build a spreadsheet that calculated the federal EFC by simply following the formula line by line. That is also what online calculators do. </p>
<p>Is the system fair? Probably not for the asset poor and income rich citizens. On the other hand, the shock of the cost of college would be dulled by making families realize the full cost of education earlier. The greatest surprise seems to come for the middle class families that have been lulled by a free public K-12 education. The rich has long learned that education is expensive. The truly poor simply does not have many expectations.</p>
<p>The real problem is and has been in the escalation of the costs that have been buried by our belief that other people will pay for our wasteful spending.</p>
<p>PS I am not assuming anything regarding the source of the funding.</p>
<p>There are two issues which are particularly irritating to me regarding financial aid. Wouldn’t it make more sense to eliminate financial aid altogether, and for colleges to use the savings to reduce the tuition costs for everyone. Considering the hefty budgets for financial aid at many colleges, the savings would be considerable and the tuition fees might actually become very reasonable for the vast majority of people.</p>
<p>Second, I don’t like how one set of parents, who have saved their money all their lives and have managed to amass significant savings, are penalized by these financial aid formulas. The parents in the other group, who on the same income have lived more ostentatiously, are rewarded with more financial aid. There seems to be a number of these inequities, which makes the system unfair and less responsive to the people who are really deserving of financial aid.</p>
<p>Financial aid depts, pay way more attention to income, than assets ( savings), unless you have really a lot of money stashed somewhere that isn’t in your primary residence or your dedicated retirement accts.</p>
<p>I agree that income is weighted more than assets, but some people who live very frugally are able to save considerable money outside of their retirement accounts (there are limits placed on contributions to retirement accounts).</p>
<p>Also, why should a dollar in a retirement account be treated differently than a dollar in a non-retirement account, particularly if both are meant to be used to generate income for retirement.</p>
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<p>A wise person once said, “I have been rich. I have been poor. Trust me, it is much nicer to be rich.” Will come to that at the end of the post. </p>
<p>When it comes to financial aid, it is easy to understand the frustration of the vast number of people caught in the middle. As I have written earlier, many families have been sheltered from the true cost of education through the mostly asinine system we use to finance our public schools. The cost is somehow buried in property taxes that some pay directly and others indirectly. Accordingly, it is not surprising that some might expect “someone else” to continue to foot the bill beyond the nirvana of the first 15 to 18 years. After all, don’t people pay taxes and property taxes? Unfortunately, in the US, we do not pay enough taxes to have a free tertiary education.</p>
<p>After figuring out that the gravy train made its last stop with the high school diploma, comes the rude awakening that most dollars needed to afford an education will have to come from their purses, most families wonder why they were not warned. Then, in panic mode, they move onto the elusive quest for merit aid, only to find out that the money for Little Susie and Bright Timmy does not flow easily to the shores of Lake Wobegon. Only the truly special needs to apply. But, wait … the money does flow to those "special kids’ who happen to be in a minority or really poor. Darn, why do they get the money and the people who have contributed can’t get it? Again, the reaction (albeit totally unfounded on a cash basis) is understandable. </p>
<p>Unfortunately, the lack of warning or lack of planning will not be a useful excuse. There is no escaping the fact that an education will cost an arm and a leg. Did you think that all those years of rampant escalation from our friendly educators won’t affect you? You escaped the K-12 boondoggle, but this one is something else! Simply stated, you will not be able to maintain the same budget and lifestyle … unless you planned and prepared for it. </p>
<p>Regarding the rich and the poor, I would strongly suggest not to envy what those families are going through. Simply stated, it is much easier to become poor than to become rich? If the situation of a Pell grantee is so enviable, there is a quick way to experience it. </p>
<p>Here we go: Before the first kids starts his second semester of Junior year, downsize your home if needed. Sell assets and pay off all your liens. Quit your well paying job and start working part-time for a NGO. The objective is to have an income just below the full Pell allocation. If you are two-wages family, make sure only one keeps a job. Pay your retirement in full in the first year of the plan, and keep the rest to water the next years of frugality. When all is done, you are now ready to tackle that Fafsa that will be toothless as it is income based. The Profile might be a tad tougher but the downsize of assets will work miracles.</p>
<p>OK, now that you have access to that magical low EFC, do you really think you are better off? Is that life really better? Not by a mile! Your kids own contributions will be tough to earn. Summer earnings? Work study? A boatload of debt at many schools? That ain’t a pretty picture.</p>
<p>Do I make this point to annoy you? Not all. I understand the frustration some have. However, do not think that the people who juggle minimum wages, need-based aid, and some scholarship have it easy. Except for the truly rich, none of us have it easy. It just look that way to the outsider.</p>
<p>Wouldn’t it make more sense to eliminate financial aid altogether, and for colleges to use the savings to reduce the tuition costs for everyone.</p>
<p>When my oldest first applied to colleges our income was low enough to not count assets. An instate public school would really stretch our resources, but she was accepted at a LAC which met 100% of EFC. If schools went to a formula where they didn’t offer aid, but lowered the price for everyone, it is doubtful it would have been low enough for D or especially students who were considered low income to attend.</p>
<p>Is that what families who don’t qualify for need based aid prefer? That need & the needy, be pushed aside & we would go back to earlier generations when only the upper and occasionally middle class students attended college?</p>
<p>“As I have written earlier, many families have been sheltered from the true cost of education through the mostly asinine system we use to finance our public schools. The cost is somehow buried in property taxes that some pay directly and others indirectly. Accordingly, it is not surprising that some might expect “someone else” to continue to foot the bill beyond the nirvana of the first 15 to 18 years. After all, don’t people pay taxes and property taxes? Unfortunately, in the US, we do not pay enough taxes to have a free tertiary education.”</p>
<p>I agree 100%.</p>
<p>“Is that what families who don’t qualify for need based aid prefer? That need & the needy, be pushed aside & we would go back to earlier generations when only the upper and occasionally middle class students attended college?”</p>
<p>I see your point, but we could calibrate it and substantially reduce financial aid for middle class and upper income families and lower the tuition for everyone . Only the very low income would be eligible for financial aid, and the amount of financial aid necessary for these families should be less because of the lower tuition fees.</p>
<p>“I see your point, but we could calibrate it and substantially reduce financial aid for middle class and upper income families and lower the tuition for everyone . Only the very low income would be eligible for financial aid, and the amount of financial aid necessary for these families should be less because of the lower tuition fees.”</p>
<p>I agree with that.
I vote for going back to the good old days of cheaply priced local public schools, where you could work and take a small loan to pay for college. Where you could get a scholarship based on merit, military service, or whatever else you had to offer. Where you lived with your parents or in a cheap tiny apartment with several other students. Where you didn’t feel entitled to live large in a fancy dorm and run up your credit cards, expecting the government or the schools to pick up your tab for an expensive education, forcing other students to pay a higher rate.</p>
<p>And if you couldn’t pay for an expensive private school, then you didn’t go there. Life goes on, you could easily take care of a cheaper school without getting in debt. Hey, I want a Ferrari, but I only can afford a Prius (maybe because I’m paying for expensive colleges for kids). Nice car, better than many, but I don’t expect someone else to buy me a Ferrari, nor will I go in debt for it. My parents aren’t rich, they won’t buy me the Ferrari, others will for their children, so what? Is everyone entitled to go to any school they can get into, courtesy of someone else paying? Jobs are tight for everyone after graduation.</p>
<p>Of course, while the state schools aren’t getting much money from the taxpayers anymore, 8K/yr or so is still a pretty darn good deal for a good state school, relatively speaking.</p>
<p>If OP’s child is gapped, the reason the grants were reduced may be that the school practices equity packaging. Schools that equity package will set a particular target number, and EFC+scholarships+grants will equal that number. If a scholarship gets added in after initial packaging, the grant will be reduced to keep the package at the target number. I worked at a school that went to equity packaging while I was there. It was a departure from past practice. To be honest, I thought it was a very fair way to package aid … it allowed more students to receive need based grants. </p>
<p>I understand that many parents feel financial aid is unfair. However, I am willing to bet those who feel it is unfair earn a decent living. There are MANY families in which the parents work full time jobs that pay minimum wage … they simply cannot assist their children in the same way those who earn more can assist their children. If we do not have some help for the children of those who struggle to provide the basics for their families, then how will the cycle of poverty ever be broken? It might be hard to afford school for many of us, but it is impossible for many more.</p>
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So one affect would be to make college cheaper for the kids of Bill Gates and Warren Buffet … and this is a good thing? Personally, I think the tuition charge is not a huge issue … but the FAFSA and Profile formulas to determine EFCs is the leverage point. The tuition charge could be $1M a year and I doubt a lot of folks would complain if the EFC level for no-loan financial aid was 50% lower than it is now for each family. </p>
<p>PS - raising tuition and then giving students aid covering the increase does not cost college real money … it costs them unrealized tuition … however any families from which they collect incremental tuition (the Gates, Buffets, etc) is extra money for the school … lowering the tuition level just deprives the school of this additional cash.</p>