Many colleges do a horrible job of presenting their financial aid awards in an easy-to-understand way.  As I’ve been explaining in my last two posts, I believe this is largely intentional:

What’s Wrong With This Financial Aid Letter

Evaluating a Financial Aid Award

Recognizing this shameful behavior, the federal government has created a financial aid template called the Shopping Sheet. If you receive a financial aid award that uses the Shopping Sheet as a model it will be far easier to understand whether a school is being generous or stingy.

George Washington University

I am not surprised that the vast majority of colleges and universities have rejected the Shopping Sheet.

Just today I was reading an article in the student newspaper at George Washington University that focused on why this extremely expensive university was not using the model award letter despite student interest.

GWU’s associate vice president for financial assistance told the student newspaper that the federal government’s model financial aid letter would be confusing. Seriously????

I find it laughable that the GWU administrator is worried about confusing families. A GWU financial aid award that  l saw last year did a superb  job of  M-I-S-L-E-A-D-I-N-G the recipient! Please read the post that I wrote about the GWU award letter in 2012 and then decide for yourself  what GWU’s true intentions are:

Is this a Good Financial Aid Award?

Financial Aid Shopping Sheet

Currently less than 10% of schools in the nation are using the federal Shopping Sheet, but you don’t have to wait for the schools on your child’s list to take advantage of this model award letter. There is a new service from College Abacus that can help you recreate any award letter into a easy-to-understand one. I’ll explain this service in my next post.

Below you will see what the federal Shopping Sheet template looks like.

The Shopping Sheet Features

Unlike nearly all college financial aid awards, this model document does not mix loans with scholarships and grants. It lets you know what your net cost will be by subtracting just the free money from the total cost of attendance. All awards letters should be doing this, but most don’t.

Below the net price on this template, you will see federal student loan options and work study. The document also mentions other ways to pay such as borrowing through Parent PLUS Loans and private college loans.

You will also see what your Expected Family Contribution is which is extremely important. I just wish the Shopping Sheet would have identified it as the family’s EFC rather than just labeling it as Family Contribution.

Your EFC, which is determined by financial aid methodologies, is what you would be expected to pay, at a minimum, for one year of school. If you have a low EFC, the school should be giving you a higher amount of aid. If the school didn’t, then you were gapped.

Without knowing your EFC, you won’t be able to determine if the award is a good one or not. Colleges,  however, typically do not provide a famil’s EFC on theirs award letters.

Other Features of the Shopping Sheet

I also like the fact that the model financial aid award also includes the graduation rate of the institution and compares it to its peers. It’s frustrating, however, that the form only includes the six-year rate. The four and five-year rates should be included too.

It’s also helpful to share what the average student is borrowing to attend this school. Keep in mind, however, that this doesn’t include parent borrowing.

Schools Using the Shopping Sheet

As I mentioned earlier, most schools have not adopted the Shopping Sheet. I want to applaud those that have. You can see the entire list by clicking on this Shopping Sheet Excel Spreadsheet.

When I looked at the list, most of the participating schools were for-profit schools such as the University of Phoenix.

State schools that are participating include University of Texas-Austin, Arizona State, University of Delaware, University of Iowa, Iowa State, many, if not all, SUNY’s in New York state, Auburn, Boise State, many Penn State satellite campuses, Georgia State and University of Virginia.

Private, nonprofit schools that I saw on the list include Smith College, Cornell, University of Miami, Rollins College, University of Rochester, Coe College, Lawrence University, Stonehill College.

I want to applaud all the schools that decided to simplify their financial aid forms and I hope many more institutions join these trailblazers before next year’s admission season!

This is the season when colleges and universities are offering spurned applicants spots on their wait lists. I wanted to share this post that I wrote last year about wait lists.  I have updated the wait list statistics for the University of Notre. Lynn O’Shaughnessy

This weekend I heard from old friends who wanted to share with me stories of brilliant students who got shut out of elite universities.

At a party on Friday night, a former colleague of my husband’s mentioned that he was stunned that his son’s friend didn’t get into Stanford University. The boy is a stellar student and he only missed two or three answers on the SAT.  He is a gifted jazz musician and throughout the party we were listening to an amazing recording of his jazz quartet.

Yesterday a dear friend in Maryland told me about a young man she knew who was rejected by Johns Hopkins University and some Ivy League schools. This young man has been doing research at Johns Hopkins during his summer vacations and his extracurriculars were just as long and impressive as the kid from San Diego.

“Can you believe that this boy got rejected from all these schools?” my friend asked. I think I startled her when I said, “I’m not surprised. In fact, I would have been shocked if he got in.”

I am always amazed that brilliant children and their often accomplished parents have a disconnect when it comes to their admission expectations. When they look at Stanford’s admission rate of 6.6%, they don’t seem to think it applies to them. If anybody can explain this, I’d love to hear it.

The plight, if you can call it that, of these teenagers reminded me of the post that I wrote earlier this month:

What’s Wrong With College Dream Lists

Trying to Beat the Wait List Odds

I’m bringing this up today because many of these students who aimed too high are now hoping against hope that they will be plucked off the wait list of their dream college(s). I heard from one of these teenagers last week who wanted advice on how to get off the wait list of the University of Notre Dame.

I am equally surprised that students who unfortunately aimed too high think they can get lucky on the wait list. My advice to them is simple: Forget it. Move on and be happy with one of the schools that does want to see you in their freshman class.

Finding a School’s Wait List Statistics

To show you the futility of being on a wait list, let’s look at the odds. You can find the wait list odds of any school by heading to the College Board’s website. Type in the name of any school and when you are directed to its profile, click on its Applying hyperlink.

Here are Notre Dame’s wait list stats:

Wait List Overkill

As you can see, the number of applicants offered a spot on Notre Dame’s waiting list was more than the number of  students in the eventual freshman class! Of the 2,461 students offered a place on the wait list, 1,153 accepted, but the school plucked just 86 from the list.

University of Notre Dame

The previous year at Notre Dame 951 rejected students accepted a place on the wait list, but only seven were eventually offered spots.

This wait-list overkill is all too common. Many schools put an obscene number of students on the wait list.

Why do schools place so many kids on their waiting list when there is little to no chance of getting off of them? Because they can.

Their callous business decision isn’t going to discourage tons of students from applying the next year. Schools use their wait lists as a way to manage their admission yield. They also turn to the wait list as a way to reject students without completely demoralizing them.

What I find sad is that so many students are pinning their hopes on suitors that have spurned them. This prevents these teenagers from getting psyched for their grand adventure at whatever colleges they end up attending. And that’s a shame.

Read more at The College Solution:

Where the Scholarships are Hiding

 Where College PhD’s Get Their Start

If you require need-based financial, you should hunt for schools that are generous with their aid packages.

This is the advice that I shared in my last college blog post: Where Is the Financial Aid Cash? If you didn’t read it, I’d suggest that you do before continuing on with this post.

If money is an issue, students should be aiming for schools that will meet a higher percentage of their financial need. One site where you can gather this information for individual institutions is at the College Board.

I’m using Santa Clara University in California as an example. I picked Santa Clara U. because it happens to be on the federal government’s hall of shame list. It is in the top 5% of  four-year schools with the highest net price (cost minus typical scholarships).

Santa Clara University

On the College Board home page, type in the name of any school and its profile page will show up. To access the school’s financial aid statistics click on the school’s Paying link.

Cost of Attendance

Once you click on that link, you will see the school’s sticker price. What I find curious about Santa Clara’s numbers is that it doesn’t include some of the expenses college students will incur such as transportation and books.

Also curious is that the school didn’t include any room and board costs for students who live off campus. The cost to rent an apartment in the Silicon Valley will be high.  I can only assume that the university wants to appear less expensive than it is.

Financial Aid by the Numbers

While you’re on a college’s cost page, look up at the top and click on the Financial Aid By the Numbers link. This is where the numbers start getting interesting.

Here is what I see next for Santa Clara U.:

Sadly, this Jesuit university, like many Catholic universities that I have researched, meet a low percentage of need for its students. It typically meets 73% of need and that figure will usually include a loan. The closer this number is to 100%, the better the deal for a student. At nearby Stanford University, which is admittedly a much richer school, the average students do get 100% of their need met.

A middle-class or poor student who receives such low financial support would graduate with a ton of debt. I would not recommend this school to someone who needs a lot of financial help.

By the way, I don’t put much stock in the pie charts that I see on the College Board; they often seem out of whack with the numbers. Also, I’ve put an “x” by the other statistic which I find to be wrong for all schools. This is a College Board glitch that I believe surfaced when the organization redesigned its website last year.

More Financial Aid Statistics

In the chart below you’ll find what percentage of students applied for aid (67%) and how many were judged to have need (78%). Ideally all the students who need help will receive it, but that’s not the case at Santa Clara. Seventy eight percent of those who applied for aid were judged to qualify for help, but only 67% of students received any.

What is really important, and illuminating, is what percentage of students had their full need met. At this school, the figure is 24%.

On the right hand side, you’ll see that Santa Clara’s average need-based scholarship or grant is $19,450, which is low for a school that costs more than $52,000. For families that won’t qualify for need-based aid, however, the average merit scholarship (non-need-based aid) is $10,357.

The average indebtedness of a student who borrows at Santa Clara U. ($28,672) isn’t much above the average of $26,000 or so. I’m not sure what to make of this. The figure could be wrong. I see a lot of figures on the College Board that look strange. Or many of the students at this school are wealthy enough that they don’t have to borrow heavily.

Often I see the average indebtedness figure left blank at schools with lousy financial aid. Unlike Santa Clara, some schools with dreadful financial aid such as New York University, Pratt Institute and Drexel University don’t have ANY financial aid data on the College Board site. Shame on them!

 In my next post, I will return to the College Board and show you statistics of a school that is generous with its students.

This is the time of year when students are receiving their financial aid awards. I’m sharing a letter today from a mom who is unhappy about financial aid letters that her son has been receiving. Lynn O’Shaughnessy

Hi Lynn,

I’m a parent relatively new to the financial aid process and I have a question.

 Once you have completed the FAFSA and the gov’t establishes your EFC, what does that number really mean?

I initially believed that it represented what the government thought a family could afford for a child to attend college (ie what our annual contribution should be to their education for the upcoming year).  I also thought that colleges then used the EFC to gauge funds that might be made available to the prospective student.

My son has applied to some schools where the aid packages being offered do not bring us anywhere near that EFC number since we are left with balances of $10,000 to $15,000 higher than our EFC.

Is there a standard for EFC interpretation and the financial aid packages schools offer?  It seems like every school’s answer is to take out a 7.9% interest Parent Plus Loan for whatever your balance might be, which is simply not a financially feasible option. My son has very good solid academic credentials and is in the upper half of the accepted student profile for each school he has applied to.

Denise

Answer to Mom’s Questions

I sympathize with this mom. Like a lot of parents, Denise assumed that the family would only have to pay their Expected Family Contribution. Usually that’s not the case.

Most people will end up paying more than their EFC because the vast majority of schools do not meet 100% of need.  Here’s an example of a school meeting 100% of need.

School’s cost of attendance: $50,000
EFC: $15,000
Demonstrated need: $35,000
Financial aid grant: $35,000

There are only about five dozen schools that say that they meet 100% of need for all or most students. Unfortunately the federal government doesn’t ask institutions this important question so you can’t find these schools through the federal database that can be accessed through the federal College Navigator.

You can look for schools individually on the College Board and COLLEGEdata for this important stat.  U.S. News also asks schools what percentage of need they typically meet and here is the rankings giant’s latest list of schools:

Universities That Claim to Meet 100% of Need

Most of the schools that meet their students’ full need are elite institution that reject the majority of their applicants. Schools with gold-plated financial aid policies include Emory, Georgetown, Northwestern, Haverford, Notre Dame and the Ivies. Of course, as I mention in my book, the majority of students at these schools are rich and are paying full price.

Beyond these elite schools, the generosity of colleges and universities vary significantly. I picked some schools at random to show you how different the aid policies can be:

• Wabash College (IN) 98% of need met, 74% of students have full need met
  

  Wabash College (one of just 2 men’s colleges left in US)

• College of Wooster (OH) 95% of need met, 54% of students have full need met
• Lehigh University (PA) 94% of need met, 53% of students have full need met
• Rhode Island School of Design 70% need met, 3% of students have their full need met.
• University of Colorado, Boulder 87% of need met, 42% of students have full need met.
• Canisius College (NY) 85% of need met, 24% of students have full need met.
• Huntingdon College (AL) 66% of need met, 17% full need met
• Heidelberg University (OH) 80% of need met, 19% of students had full need met
• Pepperdine University (CA) 78% of need met, 20% of students had full need met
• University of Texas, Austin 78% of need met, 14% of students had full need met

 Bottom Line:

If you want your childen to get the best packages possible, they should aim for schools that meet the highest percentage of need. The higher the child is in the admission pool, the more likely he or she will receive one of the best packages.

This is a stressful time for teenagers and parents who are waiting for acceptances. Or who are trying to decide what the ultimate college choice will be. Or who are wondering how they are going to pay for a school when their financial aid package is inadequate.

Today I want to share some conversations that I’ve had at my gym with stressed-out moms of high school seniors, who have about seven weeks left to make their final decisions.

Every Sunday morning at my exercise class I’ve been talking to an emotionally drained mom, whose brilliant daughter is trying to decide whether she will ultimately go to Rice University or Scripps College.

Every time the subject comes up I make a pitch for Scripps College. A friend of mine, who is a college counselor at a prominent private high school in San  Diego, usually saunters up during the conversation and also gives her opinion:   Scripps! We all agreed that Rice is an excellent institution, but that the girl’s opportunities, in our opinion, are superior at Scripps.

Rice University

Women’s colleges are incredible institutions. When graduates of women’s colleges are polled they are happier with their college experience than women who attend coed liberal arts colleges. Women graduates of coed liberal arts colleges, by the way, are happier with their educational experience than women who attend universities. Graduates of women’s colleges also attend grad school in greater numbers.

Among all of the nation’s women’s colleges, Scripps students enjoy the singular opportunity to attend coed classes literally a minute’s walk away at the other excellent Claremont schools (Pomona, Claremont McKenna, Harvey Mudd and Pitzer).  If you want to learn more about the beauty of attending a women’s college (I didn’t intend this to be the purpose of this post) check out the website of The Women’s College Coalition) and a previous post of mine Ditching Boys: Why Attending a Woman’s College Is a Great Idea.

The Perfect School Doesn’t Exist

Scripps College

The agonizing that this young woman and her parents are experiencing isn’t any different than what families across the country are experiencing.  During our conversation this morning, the college counselor shared something that is important to keep in mind.

Teenagers and parents must make choices based on the best information they have. There is no one perfect school for any child. When you pick a college or university, students and parents shouldn’t second guess themselves. Instead teenagers should dedicate themselves into making their college experience, wherever they end up, the best one possible. I couldn’t agree more.

Merit Scholarships vs. Need-Based Aid

For many families, financial aid offers will play a significant role in selecting a school. Consequently, I wanted to share a question that I got from another mom at my gym that I suspect a lot of parents are wondering about. Here is the gist of her question:

If my child receives a merit scholarship from a school is that dollar amount subtracted from our Expected Family Contribution?

For those of you unfamiliar with the term, an Expected Family Contribution is the amount of money, at a minimum, that a family will be required to pay for one year of school.

If you are poor, your EFC should be $0. You can’t afford to pay anything for college, but that almost never means that the child will attend school for free.

At the other end of the spectrum, there is no ceiling on a family’s EFC. A corporate executive at a Fortune 1000 company  once told me that by using the College Board’s EFC calculator he determined that his EFC was $108,000 a year. Of course no college costs $108,000 a year (yet) and in his case he was interested in his child finding schools that offer merit scholarships to rich students. Nearly all institutions do.

A Sample EFC

To give you a ballpark example of an EFC, I’m sharing one that I use in my workbook, Shrinking the Cost of College. Here are the family’s stats:

• Total gross income: $150,000
• Home equity: $100,000
• College accounts/home equity: $50,000
• One child heading to college and a sibling in high school

Here is the EFC using the two methodologies:

• Federal methodology: $31,426
  Institutional methodology: $27,727

What You Do With Your EFC

I don’t know what the mom at the gym’s EFC is, but let’s just assume it’s $31,426 and that the cost of the school is $50,000. I’m also going to assume that the child received a $15,000 a year merit scholarship.

The mom’s question is whether this scholarship is subtracted from her EFC, which would bring her EFC down to $16,426. If her EFC dropped to that level, her child would potentially be in line for a lot of  need-based aid.

In reality, however, merit scholarships do not shrink a family’s EFC. In this case, the EFC will remain $31,426. This is what the family would have to cover. Combining the EFC and the merit scholarship, brings the grand total to $46,426. That’s almost gets you to the  cost of the college.  Once a school adds in a federal Stafford Loan for the child, the teenager’s need would be met.

In cases where the combination of a family’s EFC and merit scholarship doesn’t come close to covering the cost of attendance, a student may receive additional help. Whether the gap is covered by need-based grants versus loans or a combination will often depend upon how much a school desires the applicant.

Learn More at The College Solution:

 What You Need to Know About Borrowing for College

What Is Your Expected Family Contribution?

Answering Your Financial Aid Questions

If your child plans to take the ACT test, you should know about ACT superscoring.

To understand what superscoring is, here’s some background:

Historically, college admission offices used a student’s composite ACT score that’s made up of four underlying categories:

• English
• Mathematics
• Reading
• Science

The test maker averages the four subcores, with each ranging from 1 to 36, to create a composite average.  Schools have traditionally only taken the composite score rather than cherry picking the best subscores. This practice penalizes teenagers who score better in some categories when taking multiple tests.

ACT Superscoring

Some schools, however, have ditched the old practice and are embracing ACT superscoring.

With this policy, a college will select a student’s highest subscores from each of the four categories and create what could be a more impressive superscore.

This practice, by the way, is standard procedure with the SAT. When a student takes multiple SAT tests, colleges routinely pick the best scores from the three SAT categories – math, reading and writing.

It makes sense for anyone, who suffers through the ACT test more than once, to ask whether a college superscores the ACT. Knowing what a school’s policy is towards superscoring is important because teenagers might be in a better position to gain admission to some schools or capture fatter financial aid packages or merit awards if their ACT results are superscored.

A Superscore Resource

Some of the big-name schools that superscore the ACT include Amherst College, Boston College, Brandeis University, Haverford College, New York University, Tufts University, U.S. Naval Academy, University of Maryland, University of North Carolina, Washington University in St. Louis and Williams College.

The best source that I have found for colleges that superscore the ACT is College Admissions Partners, which is an independent college consulting firm. You won’t necessarily find the test-optional schools on this list because, according to College Admissions Partners, the institutions that don’t require the SAT or ACT for admission almost always use superscoring.

Meanwhile, if you child does poorly on the ACT or SAT, you can find hundreds of test-optional schools at FairTest.org.

You can learn more about test-optional policies by reading this article that I wrote for The New York Times:

The Other Side of Test Optional