Really dumb question about net price calculators & merit aid ...

Paying for College
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<p>Hi All, I've gotten things a little backward, so bear with me :-) ...</p>

<p>I had run a few NPC's before my daughter submitted all her applications.</p>

<p>We have a few complicating factors so I couldn't put a whole lot of stock into the NPCs (small business owners, short furlough for one parent, etc), but I estimated FAFSA & PROFILE and have just done the corrections with our 2013 return.</p>

<p>My daughter, meantime, applied early action to several schools, and has several acceptances, which include merit awards.</p>

<p>With our <new, lower=""> tax figures, I have run a few NPCs again .... </new,></p>

<p>So my question is: when the NPC asks for GPA and the final award says, "college grant" or something to that effect, does that mean it's the merit award? if the NPC does not ask for GPA/ACT, does that mean they did not configure merit into their final estimate?</p>

<p>I am confused as to how they would know how much her merit might be ....</p>

<p>Can anyone explain how this works or the reliability of the NPCs (their experiences).</p>

<p>Thanks so much!! :-)</p>

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<p>It depends upon the school and how they have their calculators set. You can play around with the and figure it out. Change the GPA and see what happens. Keep changing it . If it doesn’t budge, then either the school did not include merit into their calculators, or they may throw in an average which they really should not, IMO. College grant can mean a need based grant, or one for merit. </p>

<p>Some schools do have guaranteed threshholds for merit and so when you input the numbers, they will be in the NP. </p>

<p>The NPCs are new and so their reliability does not yet have much of a tracke record. Being a small businees owner and having other complicating factors is going to render some of these estimates moot, I’m afraid. </p>

<p>DId you compare the NPC results to the merit numbers your DD received so far? Are you expecting fin aid over and beyond those awards? Do be aware that most schools do apply that merit award directly to need, so the your need will be reduced when fin aid runs the numbers for an aid package.</p>

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<p>cptofthehouse, thank you for your reply. You are so knowledgeable on this topic!</p>

<p>I thought the small business and in my case, furlough from my job, were going to complicate things more than they actually did. The 2013 tax form is straightforward and our EFC is now $3,200.</p>

<p>A couple of schools have awarded around 15K in merit. Their sticker prices are around 40k. Their NPCs ask for GPA, but it seems she received a higher award in merit than her GPA warranted anyway (which has been the case for several schools, and I don’t understand it).</p>

<p>The common app essay is awesome, and so are her theatre-specific resume and supplemental essays. Her common app recs, I haven’t read … her arts-specific recs are amazing.</p>

<p>So, to add another layer: when criteria is laid out on college websites as to threshold for certain merit scholarships…why does a kid then receive one or two levels higher, when the GPA/ACT did not warrant that? (this has been the case with at least 4 schools)…I guess they are awarding the ECs, essays or …something…</p>

<p>That’s why I wondered whether the NPC could possibly tell the whole story or whether we may be happily surprised when the financial aid package comes back…or if we should just count them out of the equation now, based on NPCs.</p>

<p>It’s all so apples & oranges! :-)</p>

<p>I fully realize that most people are not “happily surprised” in this process, also :slight_smile: I’m a realist and a researcher and I know schools are not fairy godmothers. Just trying to eliminate as many surprises as I can.and help her winnow down to the best possible area of focus as early as I can.</p>

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<p>I suppose it could be the ECs or the essays etc. but it could be that the school recalculates GPAs with their own weighted formula, perhaps using only core classes, not art or music etc. Can’t address the ACT scores though.</p>

<p>From your first post, if the NPC result lists grants, it should refer to need-based aid. If it says scholarship or merit-award it should be merit. But I suppose schools can be as imprecise in terminology as the IRS.</p>

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<p>Your question is an excellent one and addresses an issue that has come up before.</p>

<p>YES…some (crazy) schools will include merit awards in their NPCs without asking for stats!!! this is very misleading and often has a “best case scenario” which only fits if you’re a top student. </p>

<p>There are also (crazy) schools that will include SEOG grants (but not spell those out) and give Pell students the impression that they will FOR SURE get $9500 in fed grants. </p>

<p>I would not trust the school’s choice of words grants vs scholarships. Some seem to mix those up. </p>

<p>Since you do have a business, if any of those schools use CSS Profile then the NPCs really won’t be accurate.</p>

<p>Does your D have any safety schools that you know for sure you can afford?</p>

<p>“My daughter, meantime, applied early action to several schools, and has several acceptances, which include merit awards.”</p>

<p>those merit awards will get applied to NEED first. They don’t get applied to “family contribution”. So, if your need is $30k and your family contribution is $20k, and your D gets a $15k merit award, then that award reduces “need” by $15k…and that $15k is your need. The merit will not reduce your amount. </p>

<p>For merit to reduce the amount that YOU pay, then merit has to be large enough to cover all “need” and then cut into “family contribution.”</p>

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<p>Thanks so much annoyingdad and mom2collegekids, for not making me feel like a moron :-)</p>

<p>This is my first child in college and I feel like I have read and stalked, and stalked and read, but some things just still don’t make sense …</p>

<p>I agree that some terms are purposely ambiguous and mean different things in different places.</p>

<p>I will use the following example and get thoughts on whether this picture could eventually change for the better: Daughter applied at Ohio Wesleyan and received 20K Branch Rickey Award. </p>

<p>I just ran the NPC with the 2013 tax numbers, and based on her 3.46 UW GPA, it returned “Grants and Scholarships” totaling $31,000. COA was, I think, $53K. Which left 22K … then the NPC showed around $15 to be comprised of work study, Stafford Loan, unsubsidized loan and subsidized loan…but no parent plus (which I don’t want anyway).</p>

<p>This left approximately 8 thousand in the difference to be made up…and our EFC is $3270.</p>

<p>I realize OWU does not claim to meet full need.</p>

<p>I also realize that the 20K merit award will be applied toward that $31K in “Grants and Scholarships”…but it’s just hard to tell what else they’re putting in the $31K figure and how accurate it’s going to be.</p>

<p>Another consideration is that at many of the schools to which she has applied, she will also appy for deparmental scholarships (theatre) or have theatre auditions. I do not know if awarded, that will go toward the 31K figure or the 8k figure…</p>

<p>Thoughts?</p>

<p>I sure appreciate them!! :-)</p>

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<p>The Stafford loan IS the unsubsidized and subsidized loan…and it is $5500 for freshmen. Your daughter MIGHT get a Perkins loan IF she is lower income for that college…maybe an additional $3000. And work study could be an additional $3000 or so but she needs to get a job and EARN that money before it is given to her. I don’t see how she could get $15,000 in Direct Loans, Perkins Loans and Work Study…especially since Perkins loans and WS are NOT guaranteed awards.</p>

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<p>Yes, unsub + sub should = the Stafford total, so I think you’re misreading that. As for the departmental scholarships, most likely they will reduce need, not your contribution. At many of the schools with better aid, they will reduce work study, loans and other self help first though. Don’t give up on it but don’t get your hopes up too much either should she get one. You could contact finaid and ask.</p>

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<p>Thank you, I will go back and double check to see why I felt Stafford, unsub & sub were their own entities.</p>

<p>Yes, work study and/or a job are in the plans. </p>

<p>Work study was mentioned in its own column.</p>

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<p>Unless the merit awards specifically say they are guaranteed and formula driven, holistic factors often come into play. Colleges use merit awards to “buy” the students they most want. Also, when it comes to gpa, as mentioned, they often are recalculated for consistency’s sake. </p>

<p>As said earlier, the accuracy of the NPC is an individual thing, from school to school. Unless the school is formulaic in giving out aid and how it’s structured, and, yes, some schools are, state schools in particular, other holistic elements come into play.</p>

<p>Also some schools will package the entire Direct Loan (Stafford) as aid, some just the the subsidized portion allowing the student to use the unsub portion towards EFC. Also some school will take the merit aid straight off of the need–commonly done, actually, but some will also use it to offset self help the same way outside scholarships are usually applied. </p>

<p>When an award includes all or part of the Direct Loans and has Work study, it does limit some of the student’s options in terms of putting student unsubsidized loans and job proceeds towards EFC. If there is a heavy work study component, the student has fewer hours left to have an outside job–the WS paycheck goes towards need, not EFC. </p>

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<p>“When an award includes all or part of the Direct Loans and has Work study, it does limit some of the student’s options in terms of putting student unsubsidized loans and job proceeds towards EFC. If there is a heavy work study component, the student has fewer hours left to have an outside job–the WS paycheck goes towards need, not EFC.”</p>

<p>this is often a surprise to families who had planned on having their kids contribute about $10k per year towards EFC (combo of fed loans and part-time job). Then they’ll get their FA pkgs thinking that there will be only grants and there will be $5500 in loans and $2-3k in work study. So, not much opportunity for the student to help reduce EFC except maybe for some summer work contribution to buy books and other essentials. </p>

<p>There was a dad who posted awhile back who was quite upset about this. They had determined that their family was going to have to pay about $35, but the parents were going to struggle to come up with $24k. So, they thought that they could economize school expenses where possible (eliminate any padding) and their child could take out $5500 in student loans, and work in the summer and during the school year to meet the “family contribution”. Then came spring FA pkgs which all included full loans and work-study…which meant that they were going to be about $8k short…even after being thrifty with school costs.</p>

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<p>I appreciate the these answers - very helpful.</p>

<p>I need to do a lot more reading on loan types, and start googling “how to read award letters”…</p>

<p>I know my daughter definitely needs “skin in the game” and she is ready, willing, and able … but, as you say, that can take many forms and we have to gain understanding on the best value and best use of efforts.</p>

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<p>Basically, Chaptertwo, when your DD gets the awards, what you need to know is what YOUR personal Cost of Attendance is for each school. The tuition, fees, room are generally set in stone, some flex on meal plan, but the books, travel, supplies, personal expenses will be individual. If you live an hour from the school for instance, the travel costs are not going to be what a school cross country would cost. </p>

<p>So you write down the name of each school and how much it’s gonna cost you. Then you subtract out the GRANTS, not the loans and selfhelp, but the GRANTS, the pure money whether it 's from merit, need, state, PELL, Seogh, and add them up. Subtract it out and then you have the costs that are left that you and your student have to meet either with savings, work or loans. Past, present and future earnings is what it comes down too. You know that at each school, your DD can borrow up to $5500 that first year in Direct loans (forget the subsidy part for the moment) You know your daughter might be able to work X hours during the school year, and whether it’s work study or finding her own job, forget that for the moment. Look at that bottom line cost and then figure out the options to meet it. If there are Perkins loans and other loans (don’t count PLUS or suggestions where you have to apply, just the sure things) you see how much that is. If it’s a work study award, again, it 's just an option–most students can find work on their own, and that is not guaranteed, it’s an option and the student only gets it if s/he finds a WS and gets paid as s/he works the hour with a pay check Not gonna get that amount in a check at the beginning of the process. </p>

<p>So you look at what you and your DD need to come up with in whatever form at each school, and then tackle how you will meet that cost. The $60K school that will cover $40K of your cost with grants is fine, but that leaves $10K to cough up, doable with those Direct loans and some work whether you get WS or not. That $30K school that only gives you $5K in grants, has left a $25K gap, forget for an instant the loans it’s suggesting your DD to take and the work she should do meet the gap, you have $25K of money that has to be made up vs $10K that the other school has. But they you might have a $30K school that gives you $25K in grant money, which means you and DD are in the gravy since bottom line the $5500 of Direct loan can cover that baby right away and all job money is pure gravy. </p>

<p>So don’t count the loans and WS as aid, until you start chiseling at the bottomline cost you get with the grants reducing the cost.</p>

<p>Also make sure the grants are guaranteed for each year, and look at what the stipulation for that guarantee. Need based ones are going to depend on what your financials are each year. IF you are planning to get married to someone with an income in 2014, for instance, by, by grant if that income pushes out of that financial award range. Same if you sell your house, get some money from your company, etc, etc. You are getting the financial aid award based on need which is primarily based on income. </p>

<p>Merit awards or scholarships often depend on the student getting a certain GPA and, yes they can be rescinded if she falls under. Also has to have so many credits, and that can also affect financial aid too. Those awards are conditional, so make sure you and the student understand those conditions thoroughly. An engineering student required to keep a 3.25 average each semester… um, odd may not be so hot there in kkeeping that scholarship I know kids this year losing NYU grants and Arizona state school grants, because they don’t mess around with those requirement. My son lost his grant from our state school, and he was told, and it’s pretty clear in their rule book that they don’t care what the reason is, that you did not meet your GPA as well as your course load requirement Gone is gone, and you don’t get it back.</p>

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<p>If I were you, I would have my D work this summer to save/earn as much as she can to set aside for some of the gap. Her earnings can go towards: books and “personal expenses” during the school year. She can also buy some dorm stuff, but I would warn her not to get to crazy with all that because that can eat up her earnings. lol</p>

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<p>She has applied for a few external scholarships I hope become a reality.</p>

<p>I have called each school on her list and asked the FA depts if external scholarships “stack” with merit and go toward EFC. Thankfully, most do.</p>

<p>We live practically on top of a large university campus, and kids get rid of things very cheap and I will be keeping my eyes opened in May before they go home …</p>

<p>I also have been following the “dorm list” threads, as well as the threads which advise that you don’t need half that stuff listed and to choose/pack wisely…LOL.</p>

<p>I also have a closet into which I am putting things I find cheap at thrift/discount stores.</p>

<p>Kid is exploring paying gigs for the summer.</p>

<p>cptofthehouse - this step-by-step is EXACTLY what I need. I thank you for taking the time to post.</p>

<p>momcollegekids: points taken, and all very helpful.</p>

<p>I appreciate all your wisdom, everyone!</p>

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<p>Outside scholarships almost always stack with merit aid. BUT, they will almost always reduce financial aid, If your expected contribution at a school is $25K and the school costs $60K, your need would be $35K, right?</p>

<p>If you get a merit award of $10K from the school, it would reduce your need to $25K for that school. Let’s say that the school gives a financial aid grant of $15K, includes the $5500 Direct Loan both subsidized/unsub and $4500 in work study. Bear in mind that you still have to come up with your expected contribution of $25K somehow, and your daughter is expected to borrow and work during the school year, so those options are compromised. She then gets outside scholarships that total $12K. Oh, happy day…but that $12K will usually go first against the Work Study and Direct Loan awards and then reduce the financial aid grant by $2K, and you still have to come up with that $25K, though now your DD can borrow through Direct loans and work in an outside job during the school year to help out. </p>

<p>Not all schools work it that way, but a lot of them do. If the outside scholarship were a whopping $60K which covers the cost of the school, however, she would still likely get to keep that $10K merit award, and make money on the deal. Any outside money that she gets will reduce financial aid, starting with the self help first, then the grants, but will then go right into your contribution requirements, reducing than, until it hits the merit money where the erosion often stops. </p>