By Jacob Newman, UHEAA
Wouldn’t it be nice if you could read your financial aid award letter like a grocery shopping list?
Luckily, at many universities and colleges, you can! The Department of Education has released a “financial aid shopping list” to make it easier to compare financial aid offers. Breaking down this report, even if your college doesn’t use it, will help you know what questions to ask so that you can compare your offers and know which school is the best fit for you. Each report has five basic sections…
1. Cost in 2017-2018 year: This part of the shopping list goes over estimated costs: tuition and fees, housing and meals, books and supplies, transportation, and other education costs.
2. Grants and scholarships to pay for college: There are four funding types in this section of the shopping list: grants and scholarships from your school, Federal Pell Grant, grants from the state, and other scholarships you can use. Remember that you don’t have to pay back grants or scholarships, but you have to fill out your Free Application for Federal Student Aid (FAFSA) every year you are in school.
3. What you will pay for college: This section calculates the net costs f attending school, or the cost of attendance minus total grants and scholarships. This cost isn’t exact, but it should give you a good idea of how much you will have to pay.
4. Options to pay for net costs: The student aid shopping list will also give you options to help you pay for the remaining costs.
- Work options: Work-Study (federal, state, or institutional) is on-campus work opportunities offered to students to help them pay for the cost of school.
- Loan options: The federal government offers three types of loans:
- Federal Direct Subsidized Loans: loans that the government pays the interest on when you are in school)
- Federal Direct Unsubsidized Loans: loans that accrue interest when you are in school)
- Federal Perkins Loans: low-interest loans that don’t have to be repaid until after you graduate)
See the differences between “subsidized” and unsubsidized” student loans here.
5. Other options
This section takes into account your family contribution as reported on the FAFSA. Remember that your family doesn’t have to pay this amount, but it also gives you other payment options, including tax credits, private loans, or payment plans offered by your school.
Statistics and other information:
- Graduation Rate—This part of the shopping list lets you know what percent of students at your school graduate within six years. Remember if you graduate in four years, you can save a lot of money.
- Repayment rate—Here’s the report that shows the percent of those who took out student loans who begin repaying within three years of leaving school. This rate tells you about students finding jobs after graduation.
- Median Borrowing—The median borrowing section lets you know about how much in student loans most borrowers take out, and how much it will be to repay it over 10 years. This amount helps you know how much debt you can expect after graduation.
- Information about repayment and next steps—This final section provides the contact information for your school and lets you know how to start repaying your loans. Remember that you should only borrow what you need so that you don’t have to repay as much after graduation.
Using this information from the shopping lists, you can compare schools that you have applied to. You can ask questions about which school will be cheaper to attend. Even if your school doesn’t use the shopping list, you can always reach out to the financial aid office at the college or university you are considering to ask clarification questions.