Understanding College Cost- Part 2: Aid Package
Week 2: Aid packages
What are your tips and tricks around aid packages?
Several key points about aid packages are important to understand. First, if you use the Federal Student Aid Estimator or FAFSA, any Pell Grant amount you receive will be the same at every college. However, many other grants are state-specific, meaning you'll only receive them if you attend a school in that state. For example, if you receive an Illinois grant and decide to go to Wisconsin, you'll forfeit the Illinois grant and won't automatically receive a Wisconsin one. The Pell Grant is the only federal grant that follows you to any school.
Second, not all schools offer the same amount of financial aid. Some colleges, especially more elite institutions, have substantial aid packages and may cover full tuition and room and board for families below a certain income level. Research the financial aid reputations of different colleges. Don't assume you can't afford a prestigious school; you might qualify for significant aid.
Third, work-study is often part of aid packages. It appears as a deduction on your financial aid statement, but it's not a lump sum of money. You must work to earn that amount, and then the earnings are typically applied to your school bill. Don't mistake work-study as an automatic grant.
Finally, aid packages often include loan offers. The amounts shown are the maximum you can borrow, not the amount you must borrow. You can choose to accept only a portion of the offered loan. If you have the option, always choose subsidized loans over unsubsidized loans first, as the government pays the interest on subsidized loans while you're in school. Only take unsubsidized loans if you need additional funds.