Higher education is not exempted from the back-to-school hype. As college rankings—Forbes, U.S. News and World Report, and even this ranking for student debt—swamp the media, LearnVest likes to look at a particular bottom line: finances. Confused about the lingo used in the rankings criteria to address a college’s attitude towards tuition and financial aid? Read on to find out what to look for.
Let’s Start With Tuition
Tuition is the total cost of attending the school for one year, as charged by the school, but it is far from the total budget you’ll need for the year. Tuition can comprise the cost of taking classes and the cost of room and board, and it is very likely to rise while you’re in attendance. As explained by CollegeBoard, there are a variety of costs for attending college that may not be noted on the first bill. These include transportation, textbook, and personal expenses for snacks and recreation, as well as extra academic expenses (think lab fees). Tuition can vary greatly depending on your coursework, living conditions, and overall personal situation. Make a detailed budget to see what would really be involved for a year of schooling. If this figure is out of your price range, consider financial aid.
All About Financial Aid
Financial aid programs come in all shapes and sizes depending on the college. Fill out the Free Application for Federal Student Aid, better known as FAFSA, which is mandatory across the United States. Your school might need you to supply additional information as well. Check the national and school deadlines to make sure you don’t submit too late, and in the meantime, try to apply for personal scholarships on your own since every dollar counts. Here’s where LearnVest can help! Head to the LV Checklist I Need to Pay for Grad School.
Grants vs. Loans
If you qualify for financial aid, regardless of whether it’s through the government or the school, the basic thing to consider is the difference between loan money and grant money. Loans, you need to pay back and with interest. Grants, you don’t. Grants and scholarships are “free money” and generally preferable to loans. Colleges vary greatly in their financial aid packages: Some schools offer only loan financial aid packages, some only grants, and some a mix of both. Schools also differ in being merit-based vs. need-based in their financial aid programs. Merit-based financial aid is the more traditionally understood definition of a scholarship—this includes money given for strong academics, athleticism, performing talents, etc. Need-based aid, however, is calculated by colleges using their tuition numbers and your FAFSA information to give you enough money to make the school affordable. Basically, it is determined by your finances in relation to their price. Financial Aid Finder is one good site to help you search for colleges based on your needs.
The Importance Of Need-Blind Policies
After all this, remember that although it is a calculated expense, financial aid is a burden on the school and this can hurt your application. Speak to an admissions or financial aid office at the school to get the final word on whether the college is need-blind or need-sensitive to financial aid. Need-blind policies mean that the amount of money in your financial aid package will not hurt your application. In need-sensitive schools, colleges might have to make a choice on whether or not to admit you based on how much aid they would have to put towards your matriculation. This can be bad if they either (a) don’t accept you because of the cost of your financial aid or (b) give you less money than you need to meet their costs.
Wading through the muck and mire of the cost of financial education is worth the time. You might find out that you qualify for scholarships you never heard of or even land a full-ride debt-free. For more information on paying for your education (and what a great investment it is!), check out the LV checklist, I Am Going To College.