The Basics For Financial Aid


Brought to you by Ecliptic Financial Advisors

Financial aid is a term used to describe money that is awarded to help a student pay for college and the necessities related to college. Financial aid consists of grants, scholarships, loans, and work-study programs.

How do you get financial aid? In order to be eligible for either “need-based” or “merit-based” financial aid, you must fill out financial aid forms. Usually these forms are filed on or as close to Jan. 1st of your child’s senior year as possible. There are two financial aid forms you need to be familiar with: 1) The FAFSA form, and 2) the CSS Financial Aid Profile form. All colleges require the FAFSA to be completed. Many schools will also require a more detailed view of your income and assets by having you complete the CSS Profile form. In addition, many schools will have you complete their own institutional Financial Aid Forms as well.

Your financial aid will usually come in an awards letter or package directly from the colleges.

The financial aid process is based upon the following calculation:

  • COA (Cost of Attendance)
  • EFC (Expected Family Contribution)
  • “Need”/ Eligibility
Financial “need” is calculated by taking the Cost of Attendance (tuition, fees, books, room and board, living expenses, transportation costs, etc.) and subtracting your Expected Family Contribution. The EFC is a very complex calculation. It is calculated by taking the parent’s income and assets, the child’s income and assets, the age of the parents, how many siblings in the family, as well as a variety of other factors.

Remember that the COA is not just tuition. If a school does not include all relevant costs in their award letter, it is imperative to immediately bring this to the attention of the Financial Aid officer (FAO) at the college. An increase in the COA will cause an increase in the eligibility for financial aid.

For example, let’s say the COA at a particular college is $34,000, and the EFC is $14,000. The family would have a “need” or eligibility for $20,000 in financial aid.

  • COA (Cost of Attendance)
  • EFC (Expected Family Contribution)
  • “Need”/ Eligibility
Just because a family has a “need” or eligibility of $20,000 doesn’t mean the family is going to get $20,000 in financial aid. Not every school is in the position to give you 100% of your “need”. Some schools are only in the position to give you 60% of your “need” and other schools are in the position to give you 82%, 95% or even in the ideal situation 100%. It is important to know this information before you apply to the schools. You don’t want to find out when you receive the award letters in March and April of your child’s senior year that the schools your child applied to were never in the position to offer you the financial aid you needed in the first place. By that time it’s too late!


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