The Secret to Snagging More Financial Aid

During the past week, my son Ben has been receiving financial aid awards from colleges.
Most of the schools have been awarding him about $20,000 in college grants. Ben earned part of this money because he's the sort of kid, based on his high school years, that the colleges on his list apparently want in their freshmen classes.

The financial aid letters have also included need-based college grants, which schools award based on a family's financial need. My daughter, who is a college junior, had never received need-based aid but having two kids in college at the same time dramatically increases the chances for financial aid.

Unfortunately our son and daughter will only be in college simultaneously for the 2010-2011 school year so the extra assistance should disappear next year. Knowing this now, I wish my husband and I had spaced our two children closer together!

For us, however, the financial aid verdict is worth celebrating. Based on these awards, Ben will be able to attend any of the liberal arts colleges on his list. Not all students and parents, however, are going to receive such happy news.

The unluckiest families will rip open their financial aid awards and find mostly loans. Beyond having multiple children in college at once, here's a great way to decrease the chances of finding a lump of coal in your financial aid goodie bag:
Don't aim for reach schools!
Most colleges can't meet the full financial need of all their applicants. Schools have to dispense their money carefully and that means they will reserve the fattest rewards for the applicants whom they covet the most. As a general rule, a student will enjoy a greater chance of receiving a financial aid package stuffed with grants rather than loans if he or she is in the top 25% to 33% of the applicant pool.

Beware of Gapping

Students who miss this cut are likely to get gapped. When this happens, a school accepts the child, but the gap between what he or she needs and what the school provides can be huge. In extreme cases, the gap can be tens of thousands of dollars.

There is one big exception to my admonition against reach schools. When students, who require financial assistance, get into one of the nation's most generous colleges, they will receive a financial aid package stuffed with grants. At these schools, it won't matter if your child is the last applicant in the door, he or she will enjoy the same great deal.

Lynn O'Shaughnessy is the author of The College Solution and she also writes for TheCollegeSolutionBlog. Follow me on Twitter.

More on CBSMoneyWatch:

Why Saving For College Won't Hurt Financial Aid Chances

Financial aid image by oskay.