Navigating College Financial Aid Offers
Financial aid award letters can be confusing, and they're not standardized across schools. Here's how to decode them and make informed comparisons.
Understanding Your Award Letter
Types of Aid
**Grants and Scholarships** (free money) - Federal Pell Grant (need-based, up to ~$7,400/year)
- Institutional grants (from the college itself)
- State grants
- Outside scholarships
**Work-Study** (earned money) - Federal or institutional work-study
- You earn money through a campus job
- Not guaranteed income — you must find and keep a position
**Loans** (borrowed money) - Direct Subsidized Loans (need-based, no interest while enrolled)
- Direct Unsubsidized Loans (interest accrues immediately)
- Parent PLUS Loans (parent borrows)
- Private loans (last resort)
Calculating Your True Cost
**Cost of Attendance (COA)** includes:
Tuition and feesRoom and boardBooks and suppliesTransportationPersonal expenses
Net Price = COA − Free Money (Grants + Scholarships)
This is the number that matters most. Ignore the sticker price — focus on what you'll actually pay.
Comparing Offers
Create a spreadsheet with these columns for each school:
Total Cost of AttendanceTotal grants and scholarshipsNet price (COA minus free money)Total loans offeredWork-study offeredOut-of-pocket cost per yearFour-year total cost
Negotiating (Yes, You Can)
When to appeal:
Your financial circumstances have changed (job loss, medical expenses, divorce)You received a significantly better offer from a comparable schoolThe award doesn't reflect your demonstrated need
How to appeal:
Contact the financial aid office — be polite and professionalPut your case in writing with documentationExplain specific changed circumstances or competing offersAsk what additional information they might need
Red Flags
Schools that "front-load" aid (generous freshman year, less later)Award letters that don't distinguish grants from loansPackages that rely heavily on Parent PLUS or private loansAid that requires maintaining an unrealistically high GPA
Making Your Decision
The cheapest option isn't always the best, but debt matters. Consider:
Will you need to borrow more than $27,000 total (federal loan limit)?Is the career outcome difference worth the cost difference?Can you reduce costs (commuting, working, graduating in 3 years)?