Congratulations! You have been accepted to Prestigious University.
Trumpets blare! The earth has moved! You made it. You are in!
Now how are you going to pay for it?
How to win a great Financial Aid package and actually pay for college.
Think of this as your homework - but homework that will pay you $10,000 or more per year for the next four years.
Caveat #1: If you or your parents make more than $200,000 combined then don't read further - you will have to pay for college or get merit, field of study, religious or sports scholarships.
Caveat #2: I assume you have been attentive enough to have submitted your FASFA, State grant application and any other college specific financial aid forms such as CSS/PROFILE. Most of these deadlines have passed, but if you have not completed the above then CALL TODAY and see if you can still apply for financial aid.
Caveat #3: This works better for private schools than public schools because private schools have more flexibility with the sources of financial aid they can tap into for your package. So don't be afraid to apply to private schools, they may not be as expensive as you first think.
Step One: Be Nice, Always Say Thank You. First as you receive your admission acceptance letters, respond back to the school admissions officer AND financial aid officer thanking them, conveying your excitement, and indicating you are waiting for their financial aid offer before making any decisions.
Step Two: Compare All The Offers. Receive all the INITIAL financial aid offer packages from every school. Don't take the first offer. Compare all the offers - you will see that each college can offer you different types of aid: loans vs. grants, work-study, books and supplies assistance, a discounted computer, housing costs, payment plans, etc. Make a spreadsheet to compare each item offered across all the schools. You will now see where one school has stepped up in funding and another has more work-study. This is your starting negotiating point - to make each offer the best it can be.
Step Three: Don't Be A Sucker - Don't Take the First Offer.
The initial financial aid package is just that - initial. The colleges send out really nice acceptance packages, followed by phone calls, emails, post cards, etc. to get you to take the initial offer. The more students they can enroll at full cost or near full cost (maybe with a little $5,000 financial aid offer sweetener) the more money for them. And at $30,000 to $50,000/a pop why not try. Don't bite. They may make a second offer, don't bite. Thank them as above, keep clam and wait. Wait two to three weeks or about three weeks before the acceptance deadline.
Allow me to explain why (in general terms): Each year each college has a budget for financial aid; let's say it is a $10 million pot and they have 1,000 slots to fill. They admit 2,000 students knowing about half will choose not to attend. So of the 2,000, 500 students take the initial full/almost full offer. Note the pot is still at about $9 million but 1/2 of the slots are filled. Now 1,000 students decide not to attend. The pot still sits at $9 million but now there are only 500 accepted students left. Now 300 of these students take the round two (admittedly better) financial aid offer. The pot still sits at around $7 million for the remaining 200 slots or $35,000/per slot. Now you can negotiate knowing that the math works in your favor. You are already admitted, and the college has the budget remaining to make you a great offer.
Step Four: Asking For More.
Remember you are accepted; they aren't going to kick you out. Now decide what a great financial aid package is for each college for you, using your comparison sheet above. Call or email the financial aid officer - the higher title/person the better.
- Thank them for their offer(s).
- State your financial situation. This is the time to MAKE SURE they understand your special financial circumstances (debt, medical bills, no parental support, lost job, supporting relatives, first in family to go to college, etc.) Note this is YOUR story. This is what separates you from all the other people asking for financial aid. Make it 1 page or less, straightforward, financially factual and put it in writing to them.
- State how important it is for you to attend their college. Again this is YOUR story. Mention the department/major you want, special programs that they offer that you want - be as specific as you can be. Why? Because they have funds for certain programs/majors and the department head can make exceptions for their department to help fund your financial aid package. You can also call the department head and explain how much you want their program and ask if they have dedicated funds and if they can call the financial aid officer on your behalf.
- Ask for every possible avenue of financial aid to be explored. This is where your comparison sheet above helps as you can see where one school offers a stipend of $1,500/year for books and another doesn’t – then go ahead ask for it. Be creative, do they have a dorm room manager position where you earn free room and board? Do they have any special scholarships or grants for your specific financial hardships? Note sometimes it helps to ask students at the college about other aid options.
- Loans. Ask for loans to be turned into grants. Yes you are willing to take on loans, but don't accept their formula - ask for an exception. Plead your case for not taking on more debt – maybe you already have enough debt and can’t handle any more.
- Terms. Ask for payment terms. Most colleges will offer a payment plan over a year with a small processing fee. Ask if this can apply to books and supplies as well. This can really help later when money is tight.
- Go to the top. Okay the financial aid officer has just given you their best and final offer. Is it their best offer? Probably not. You see each financial aid officer has a ceiling or limit on the package they can offer to you. The Chief of Financial Aid, often along with the financial aid committee, has the right to make any offer they want to you. They can step up and offer you a "full ride" IF you are important enough to them. Here it really helps if the above work to explain your special financial circumstances and specific interest in the school is clear and persuasive.
Caveat: NEVER throw another college’s offer in their face. The financial aid officer is going beyond the call of duty to help you out and you are working as a team with them. Holding one school's offer over their heads NEVER works. Since so many people blow this one -- think of it this way; if you have a girlfriend or boyfriend and mention how great another person would be - does that make them want to be with you more? I think not.
- Finally, wait. Wait until the end. They will make you their best offer if you communicate and work with them. Be firm, be persistent, be clear in stating your needs and be polite.
You can win a great financial aid package and afford college and get ahead in life – without years of debt staring you in the face.
As one famous multi-college graduate would say, "You betcha!"
Best of luck.
PS. Shout out to Congress and Obama for signing into law the student loan program changes which will make college more affordable for students. See how easy it is to use reconciliation!