The Federal Methodology
is used to calculate your eligibility for financial aid. This is based on an analysis of income and assets
of both parents and student. Your Family Contribution (FC) is what you will pay at any college you attend.
Your 'need' then is the amount over this (FC) up to the total cost of attendance at a particular school and will vary
from one school to another as the total cost of attendance varies at each school.
So, if the cost is $25,000 per year and you are expected to contribute $10,000, then your eligibility for aid will
be $15,000. If the school covers that at 68% , you are looking at a total cost of $14,800 for
that year ($10,000 + 32% of $15,000). This assumes you qualify for the 68% available. The 68% may be a combination
of grants (free money), work study & loans. What if the college covered your need at 93%? Then
you would want to know this and perhaps pursue this school to lower your costs. In many cases it may be possible
to attend a higher priced private school at a lower actual cost to you than attend a lower priced state school, depending
on the percentage of need the school covers. Private Schools use an Institutional Methodology which means many
additional forms & deadlines & disclosure of an almost unlimited amount of detailed financial information.
There will be a variety of institutional forms and supplements which are typically not required at state schools.
Finally, If the cost of attendance at the school you select is $9000, then you will not be eligible for any needs-based aid,
as this is less than your family contribution ($10,000).
Without knowing all of these details in advance, it is impossible to come up with a plan that will allow you to comfortably
get all of your children through school. You can see how school selection is extremely important not only for suitability
and the curriculum, but for how that school fits into your college funding strategy. ALWAYS choose as many
schools as possible & choose these schools based on what is best for your child as well as what works best in positioning
your student for financial aid. With proper planning & guidance you will most likely be able to control the
cost of attending any school. It may ultimately turn out to be out of reach for one reason or another, but
how can you know this without seeing all of the information?
NEXT: College Planning
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