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Crash Course on College Aid

The first rule of any negotiation is to learn as much as you can
about the parties across the table. Understand their motivation. Learn how much
they've bent in the past, and what they hope to get out of you.

The same is true when you're researching colleges with your prospective freshman. Uncovering each school's "financial
fingerprint" should give you a good idea whether your child can
expect a href="">handsome aid package. Armed with all this information,
you're more likely to find a school that's not only the
right academic match, but the perfect financial fit.

Determine How Colleges See You

Find the type of aid you’re most
likely to get.

Some schools reserve price breaks for low- and middle-income
families, but many also offer href="">awards to affluent students. You need to figure
out whether you qualify for need-based aid, which means that your chosen school
costs more than your family is considered able to contribute. If not
— if you are deemed rich enough to swing college out of your own
resources — you’re going to be applying for merit aid. The
right aid calculator will help you see yourself as financial aid offices see

Essential Ingredients

The Calculators You’ll Want to Use

Try the href="">federal FAFSA4Caster calculator,
which the government created based on the standard FAFSA (Free Application for
Federal Student Aid) form. If you’re interested in selective private
colleges, you’ll also want to run the numbers with the Expected
Family Contribution Calculator at; set the
“Need Analysis Methodology” to

Ask a College About Its Particular Policy

Weed out schools that won’t offer the
aid you need.

The guidelines schools use to dispense financial aid vary
wildly. So you’ll want to grill each institution about its aid
policy. Ask the critical question, "What percentage of a student’s
financial aid need do you typically meet?"

Seemingly similar schools may answer
quite differently. Columbia University aims to meet 100 percent of need and
offers grants that don’t require repayment. A New York University student is more
likely to graduate with debt since the university typically meets less than 68
percent of the needs of its financial aid students, and a portion of that
assistance is loans. (But NYU reserves some of its institutional cash to entice
top students from affluent families, while Columbia seems to feel that its
reputation is enticement enough.)

Ask schools about their merit aid rules. Most colleges, public
and private, dispense merit awards to well-off students with solid academic
records. Case Western Reserve University baldly states on its Web site that
“you could be Bill Gates’ kid and still receive a
merit-based scholarship.”
The average merit award at Case: $19,409. A
few dozen highly selective schools, such as Massachusetts Institute of
Technology, Princeton University, Amherst College, Pomona College, Williams
College, and Brown University, don’t offer merit aid, however.

Technically Speaking

Decipher the Merit Money Lingo

In higher-ed speak, merit awards are often calculated as a
percentage discount off tuition. According to the College Board, the average
tuition discount for private colleges is 33.5 percent. With that sort of price
cut, a $30,000 tuition would drop to $19,950. (The typical price break at
public colleges is nearly 15 percent.)

Amass Key Data on Each College

Find out everything you can about a
school’s aid handouts.

It’s imprudent to rely on just the verbal assurances from
a school’s financial aid or
admission officer.

To get the real scoop, check out an obscure, yet amazing
document called the Common Data Set. Each school’s Common Data Set is
a treasure trove of statistics on enrollment, freshmen class profile,
retention, and the characteristics the institution most values in its
applicants. You’ll find the number of students who request financial
aid, the number who get it, the percentage of need the school usually meets,
what the average package is worth, and how awards are split between grants and
loans. (To find this cache, Google "Common Data Set" and the school's name.)

You can often also find a great deal of data about a
college’s aid and in-house scholarships on its Web site. Baylor
University, for instance, posts a scholarship calculator that can instantly
tell prospects which type of awards they could be eligible for based on their
SAT or ACT scores and class rank.

Hot Tip

Say Yes to No Loans

If you qualify for financial aid and are blessed with an
unusually bright teenager, find out whether the colleges on his or her list are
among the growing number of “no-loan” schools that
underwrite colleges with grants. There’s a list at the Project on
Student Debt

Request a “Pre-read”

Gauge the true cost of the college.

Blindly applying to schools with only a vague idea of their
ultimate cost is not just financially unsound, it’s unnecessary.
Instead, ask a college for a candid assessment of your family’s
financial aid chances before sending in an application.

Muhlenberg College in
Allentown, Pa., for one, gives an early assessment or “pre-read”
on a teenager’s chances for merit aid before he or she
applies. If you provide your child’s grade point average, class rank,
standardized test scores, and activities, a financial aid officer should be
able to form a pretty good idea if his or her school would cut the price for
your child.

Voice of Experience

Some Colleges Will Boost Aid Now

“The middle-market, private, liberal arts
college is where it’s going
to be brutal this year. What you will have are schools competing like crazy for
students, and these schools are discounting heavily.”

— Paul Hamborg, a vice president at Human Capital Research
Corp., a higher-ed consulting firm in Evanston, Ill.

Read more about the college aid game:

href="">Don't Let the Market Crimp Your Child's Choices

href="">Why a Prepaid College Savings Plan Might Be Wise

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