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5 Financial Aid Missteps to Avoid When Planning for College

Now that the 2021-22 college admission cycle is in full swing, family discussions inevitably turn to “how will tuition, fees, housing, meals, books, and supplies be paid for. And rightly so. The average cost of tuition and fees at a ranked in-state public college is $9,687 for the 2020-21 year compared to $35,087 as the average sticker price of a private university. The average cost for out-of-state students at public colleges comes to $21,184 for the same year.

We have highlighted the most common mistakes parents make in this area. This is a must read for parents of the Class of 2022, and important information to learn for the parents of the Class of 2023, and younger.



1. AVOIDING “THE TALK”

By delaying or avoiding the conversation of how much they can afford to pay for the child’s college, parents miss the opportunity to set expectations. Since the largest scholarship a student receives generally comes from the college they attend, the student’s college list must include those colleges that offer merit scholarships and grants. Not all do. This research needs to be done as the balanced college list is finalized.


2. KNOW YOUR EXPECTED FAMILY CONTRIBUTION (EFC) AND USE NET PRICE CALCULATORS (NPC)

You really can’t target the schools most likely to meet your family’s financial needs without knowing your EFC (soon to be known as the Student Aid Index) or using the school’s NPC. Knowing your EFC and using the school’s NPC allows you to make sure your college list includes schools more likely to provide generous merit or need-based aid.


3. SUBMIT THE FAFSA

According to Mark Katrowitz, of the Saving for College website:

Unless the parents earn more than $350,000 a year, have only one child and that child will enroll at an in-state public college, they should still file the FAFSA form, as there is a good chance they may qualify for federal student aid or state or institutional grants. They may also qualify for low-cost federal loans and federal work-study.

The 2022-2023 FAFSA will open for completion and submission on October 1, 2021. It will require you use your filed, 2020 Federal taxes to complete properly.

4. AVOID PAYING OUT-OF-STATE TUITION FOR PUBLIC UNIVERSITIES

Out-of-state tuition is expensive. Public universities have been increasing out-of-state tuition to make up for cutbacks in government funding. Or to put it more bluntly, universities are using out-of-state students to help subsidized in-state tuition. Unfortunately, the expensive tuition – in many cases the cost of a private institution – doesn’t afford the student better resources. Instead, out-of-state students are paying the cost of attending a private school but getting the resources of a public university.


5. STAYING CLOSE TO HOME IF YOU LIVE IN CALIFORNIA

Most students we work with live in California and this happens to be, along with the northeast, one of the most expensive places to attend college. Private colleges in popular areas tend to provide less merit awards since they have no shortage of students wanting to attend.

Also, public colleges, though they offer cheaper tuition and fees than private universities, have very high costs for room and board. Consider this short survey:


CONCLUSION

Parents can set their child up for a successful college admissions process by avoiding these mistakes. By being open about the family budget for college and avoiding common mistakes in college planning, the process of choosing which admission offer to accept will be an exciting one not marred by the anxiety from “how will we ever pay for it” thoughts.

Parents of children from the Class of 2023 and later, if you are looking for financial aid, scholarship, and other college planning advice, please connect with us via our website. We would be delighted to schedule a complimentary consultation with you and our child!



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This blog was written Janice Royal, MA. She is the Founder and CEO of Royal College Consulting.


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Email: janice@royalcollegeconsulting.com

Phone: (714) 319-0399