Comparing Financial Aid Packages
Last updated September 26, 2020
If you’re comparing financial aid packages, you’ve already received some good news. You were accepted to college! Your next step is to figure out which college is offering you the best financial aid package. Unfortunately, attending college has a number of hidden costs, and financial aid packages don’t always make these costs explicit.
There are three key things to pay attention to as you analyze and compare your financial aid offers.
- Total Cost of Attendance
Understanding the overall cost of attending the colleges you’re comparing--both annually, and total over the course of 4(+) years you spend earning your degree--is obviously critical.
The overall cost of attendance is more than just your 4-year tuition bill, it includes -
- Food and housing
- Lab and course fees
- Health/medical care
Textbooks, course fees, health/medical care, transportation, and food and housing often wont be figures represented in your financial aid package. So it’s important to dig into how much these might cost over the course of four years at each college. Textbooks cost the average college student $942 per year. Housing and food costs vary wildly between colleges, and are heavily dependent on location (rent for housing will obviously be higher in a huge major city than a small college town, for example).
2. Financial aid
Think of financial aid as the total amount of money you’ve been awarded to help pay for your overall cost of attendance.
There are 3 main types of financial aid you’ll receive in your award package:
- Grants and scholarships - grants and scholarships do NOT have to be repaid. Ever.
- Student loans - Student loans come in four forms, must be repaid, and accrue interest until they are repaid
- Federal Direct Unsubsidized loans - These start accruing interest as soon as you accept them.
- Federal Direct Subsidized loans - Interest on these does not accrue until after you graduate college (or stop attending for any reason other than a leave of absence)
- Perkins and Parent PLUS loans - These are loans your parents can accept to help pay for your college. The onus for repayment and any interest accrued is on your parents.
- Private loans - these come from banks or credit unions or private student lenders. Qualifying for private loans is dependent on your/your parents credit score. These generally have fewer protections for borrowers, higher interest rates, and should be considered a last resort for paying for college costs.
- Work study - Work study is a guarantee of an on-campus job.
- Pay close attention to the balance of each of these types of aid in your financial aid package.
3. Once you get a feel for how overall cost of attendance and financial aid are calculated - here are several factors you should consider
Take each financial aid package you’ve received, do the overall cost of attendance - financial aid = total annual/4-year cost math, and look at that estimated final price tag for each college.
Then, ask yourself the following questions, and start ranking your schools -
- Which college is, overall, most affordable? Which college is offering you the most scholarships and grants (aid that doesn't have to be paid back)?
- Which college are you most excited about? How does that college rank in your hierarchy of overall annual/4-year costs of attendance?
- Which college has the best programs and facilities for the major (or majors) you’re interested in?
- Where is each college located? What are housing prices and the job market like for each? Is it in a major city with plenty of job opportunities, but a high cost of living? Or perhaps a more remote college town, with cheaper housing, but less job opportunities? Think about how these semi-hidden costs factor in.
As you read over these, take advantage of this financial award package comparison tool from BigFuture. Be sure to text our college coaches with any financial aid questions you have, text "College" to 33-55-77!