Students should celebrate every college acceptance letter they receive! When the celebrating is complete, it is time to carefully review the Financial Aid Award Letters (Award Letters) that follow, typically in 2-3 weeks. It is important that students and their families compare net price to net price when reviewing Award Letters since the format can vary greatly from college to college.
Make sure to include indirect expenses such as books, supplies and travel expenses when calculating the total cost of each school and separate financial aid into two buckets: Gift Aid and Loans and Work Study. Gift Aid – grants and scholarships – do not have to be paid back, and directly reduce the net price to students. Loans have to be paid back with interest and parents must qualify for PLUS loans. Work Study is a great way to help fund college, but it is also not guaranteed.
Visit the Federal Student Aid website to learn more about evaluating Award Letters and different types of loans.
Fund Your Future, published by the California Student Aid Commission, includes a useful worksheet (page 24) for evaluating financial aid offers.