Transcript
How do you read a financial aid award? It's one of the most common questions that I see at this time of year because lots of students across the country have been getting their financial aid award and their acceptance offers. And let me tell you that financial aid awards go from really good, like the one right behind me, to really bad, including ones that are like blank, messed up. I've seen them all and I'm really surprised that a lot of colleges even attempt to send out what they're sending out. But I want to show you how to compare them and how to read them and what I think matters the most for you. So, starting at the top, you should always focus on your direct cost first. This is tuition, fees, room and board, meal plans. These are the costs that you're actually going to pay to the school. This award right here separates out the indirect costs. Many of them put them all together and I disagree with putting them all together because one, these indirect costs, man, they are wrong all the time. Number two, a lot of them are personal preferences. How much do you want to spend on dorm decor? Where are you traveling from? What does that look like? So, they can vary a lot. Then, I want you to subtract your gift aid. Gift aid is scholarships, grants, Pell grants, things like that that are offered that are free money. This is money that you're not going to have to repay. Again, I see I would say 80% of financial aid awards combine gift aid with student loans and I think that does families dirty because loans you have to repay. Work study, that's fake aid cuz you don't get it before the school year starts and you might not get it at all if you don't get a work study job. So, look at gift aid and subtract the two and you really want to compare this price right here, the cost after gift aid, because that's what you're going to have to write the check for or borrow student loans for and that's what you want to compare apples to apples at each school. Because if you're getting student loans, you're getting student loans at every college, and you can see the federal student loans right here. This award letter does something really cool that I don't see on a lot of award letters, and that is showing the repayment plan, or sorry, the payment plan options. Most colleges offer a payment plan in lieu of student loans, and you can break out your payment into 3-month or 9-month, some do 11-month and just pay as you go, which is a savvy way to do it if you don't want to borrow, but you you have enough, but you really want to do it in installments. So, hopefully this helps you understand what a financial aid award looks like, what you actually want to compare, again, cost after gift aid, and what you need to watch out for mixing the indirect cost and the student loans into the big picture. I hope that helps. Please like, subscribe, and follow, and send this to a friend that needs to know it.