Comparing Financial Aid Packages
Last updated August 23, 2022
Congratulations on getting accepted into college! Now that you’ve been admitted to a few schools, the next step of the college application process is to compare the financial aid packages you receive from them. After admitting a student, colleges and universities create a financial aid offer letter for them, breaking down all the grants, scholarships, work-study opportunities, and loans that they’re able to offer them to cover the cost of tuition & school-related expenses. It can also be referred to as an “award letter” or “financial aid package.” This offer letter will be unique to each school that you are accepted to. Here are some key things to pay attention to as you analyze and compare your financial aid offers:
Note: Before committing to a school, review your offer letters with a parent/guardian or trusted adult to make sure you make the right choice for you and your financial situation.
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 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
The things listed above won’t be specifically mentioned or broken down in your financial aid package, so it’s important to dig into how much these might cost over the course of your time in college. Housing and food costs can vary wildly between colleges, and are dependent on location (rent for housing will likely be higher in a major city than a small town, for example). If you are living in the residence halls, the costs should be listed on your college’s housing website. If you are living off campus, your housing costs will be based on your monthly rent, utilities, groceries, and other essential living expenses.
Think of financial aid as the total amount of money you are given 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: These forms of aid will NEVER need to be repaid – think of them as free money for school. These can come from the federal or state government or the school directly.
- Student loans - Student loans come in four forms, must be repaid, and accrue interest until they are repaid:
- Federal Direct Unsubsidized loans - These loans start accruing interest as soon as you accept them.
- Federal Direct Subsidized loans - Interest on these loans 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 apply for to help pay for your college. The responsibility of 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.
Learn more about student loans here.
- Work-study - Work-study jobs are jobs students typically work on-campus to make extra money to put toward school or living expenses. Eligibility for work-study is determined when completing the FAFSA.
Comparing your award letters
To see which school is offering you the best financial aid package, we recommend using Scholarships360’s free Financial Aid Award Letter Comparison Tool. While reviewing and comparing your letters, here are some questions to ask yourself to come closer to finalizing your college decision:
- Which college is, overall, most affordable? Which college is offering you the most scholarships and grants (aka aid that doesn't have to be paid back)? Are the scholarships going to be awarded every year or one time?
- 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? Is it in a smaller town with cheaper housing but less job opportunities? Think about how these semi-hidden costs factor in.
You don’t have to figure out financial aid on your own! Text #College to 33-55-77 to speak with one of our College Advisors - they can answer any of your questions and help you make a decision that works best for you.