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Need-Based Aid

Good news!

A lot, if not most, money for college is based on need, not grades or other merit.

Not only that, but as of 2012, there was more than $177 BILLION available for undergraduates--by the way, that's what they call you before you graduate from college.

Here's how the financial aid process works:

Schools send out financial aid packages to accepted students, usually about a month after the acceptance letter. Those packages will list money from different sources that make up 100% of what they estimate it will cost for you to attend their school for a year. Those

costs include tuition, room and board, books, living expenses, travel costs. Each school makes the calculation for themselves.

The usual sources of financial aid listed in their letter will be: tuition reduction, grants and scholarships, work-study (on campus job) opportunities, expected money contributed by the student (from summer work or other sources you have), expected money contributed by the parents, and loans of different kinds to the student and/or to the parents.

Your family's expected ability to pay college expenses is derived from the FAFSA, and sometimes additional evaluation instruments (for example, the College Scholarship Service Profile or the Consensus, depending on the school). The financial aid package they give you will be keyed to this expected ability to pay.

HOWEVER, only a percentage of schools are committed to charge you and your parents only what you can afford. These schools meet "full demonstrated financial need"--let's call it "Full Need" schools-- if they admit you. They commit to find other resources, often from within their own donations, to make up any difference. Other schools will offer you and, primarily your parents, a variety of loans to make up any difference. Clearly, if you need money--and who doesn't?--you want to go to full need schools! These schools are not only some of the best in the nation but they are actually rich. People have given them money for many years because they appreciate the quality of education they provide. How much could it cost to go to these schools?

In other words, the question is, WHAT'S YOUR NUMBER?

Click on the link below and click on MyinTuition (and NOT Net Cost Calculator.)*

I'm a paragraph. Click once to begin entering your own content. You can change my font, size, line height, color and more by highlighting part of me and selecting the options from the toolbar.

In other words, if you family makes $70,000 of income a year, owns your home but pays a mortgage, and has a bit in investments, you could receive around $61,000 a year in financial aid.

Okay, now pay attention!

Grants and Scholarships do not have to be paid back! The best!

Loans do have to be paid back. Useful but not the best (see the previous line).

Like any other loan for a house or a car, banks charge a fee (called interest) which is a percentage of what you borrow. In fact, they charge interest continually and interest then begins to be charged on interest. In other words, depending on how quickly you can pay back the loan, you will pay extra beyond what you borrowed (called principal).

Some educational loans start charging interest right away--not the best.

Some wait until the year after you graduate--a lot better .

Work-Study are jobs on campus that the federal government pays you to do. (There are lots of other jobs, often on campus or nearby, that you can get, too.) Work-study jobs can give you work and even career experience while you are going to school--pretty darn good!

To really get into the nitty gritty, these useful sites are all administered by the U.S. Department of Education.

Federal Student Aid is a good starting place for students planning for college and looking for financial aid.

Free Application for Federal Student Aid (FAFSA) takes students line-by-line through the financial aid application process.

Financial Aid Overview  has links to many useful sites on this topic.

Funding Your Education: The Guide to Federal Student Aid, published by the U.S. Department of Education (DOE), is one of the most comprehensive resources on student financial aid, covering major aid programs, including Pell Grants, Direct Loans and PLUS Loans.

* Our thanks to Deborah Ching for this great planning information. To learn more, directly from her, text or e-mail (phone calls from unidentified numbers will not be answered) Ching Consulting at (808) 783-4070 or

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