<p>For an example of a school that doesn't obfuscate, see Muhlenberg</a> Merit Scholarships. Muhlenberg is quite honest in its statement that those who receive merit scholarships are also given "preferential packaging" for need-based financial aid (weighted more towards grants than loans). </p>
<p>Merit aid alone, though, is given by the Admissions Office. The preferential packaging of the need-based aid occurs after the merit award. And the merit money is taken into account when calculating need - the amount of "need" is reduced by the amount of the scholarship.</p>
<p>"What seems to be less known is that some institutions use what they call "merit awards" as a tool for yield management. What also seems to be less known is that at many schools, the admissions office and the financial aid office communicate and work together in deciding aid offers. How common this is I do not know."</p>
<p>It is not uncommon that the Director of Admissions is also the Director of Financial Aid. Which lead you to believe the two departments not only communicate with one another but also work closely together.</p>
<p>onestack, I do think that they work closely together at some schools. Here is a personal example. My son applied to a school where he received a 7500 merit scholarship. The scholarship I was told is awarded as a group of professors read through applications, and they determine who receives which award. My son also applied for financial aid. He did not receive any additional financial aid grant money, but was offered w/s, and a subsidized stafford loan. We submitted an copy of an offer from another school which has students with similar stats, to the financial aid office. Our son was offered a 13,000 merit award at the second school, along with admissions to their honor's college. The school which offered 7500 now counter offered a merit award of 10000, and then they took away the w/s and the subsidized stafford. They also increased the gpa to keep the 7500 from 2.8 to 3.0 for the 10k. Here is an example of admissions and the financial aid office working together and changing my son's merit award (which is never what we asked for, but in all fairness we were comparing merit aid with financial aid-not the thing to do. Still it was the bottom line to us that mattered). We were hoping to get a financial aid grant instead, but that did not happen.</p>
<p>While we all fret and scramble to deal with giving up our small retirement accounts to underwrite college costs, please read the today's update on Princeton's huge endowment growth reported by F. Scottie on the Princeton thread. And reach for those Tums.</p>
<p>"Not even close! According to ours, we should have been able to pay about 30K per year for school out of pocket."</p>
<p>There isn't a school in the country that expects ANYONE to pay for school out of pocket. The EFC is a measure of what you should be able to pay given 1) assets; 2) income; and 3) future income, measured against future need (such as retirement).</p>
<p>(For the record, the out-of-pocket cost for us to send our d. to Smith is less than it would cost us to send her to the local community college.)</p>