Can someone explain the income levels and cutoffs for school funding, please?

[Carpe Diem]

Thanks.

[wapiti]

FWIW, I don't understand this question - maybe you could be more specific.  What school funding are you referring to?

[Carpe Diem]

Oh sorry.

 

When you fill out the FASFA does this only apply to grants and financial aid? Scholarships come from each school if they feel like providing them to you? What are the income levels that you cut you off from financial aid? I am thinking about taking a job but worrying that it will push us over a limit that would make it harder for my daughter to afford school. I would hate to earn $500 too much and push us over but yet not have money to pay for school. YKWIM? Does the FASFA take into account medical bills? Some of or income would be from having to use retirement money.

 

Any advice r links for further reading would be helpful. For now I am looking at magical cut off numbers. I have a lot to learn!

 

Thanks!

[G5052]

The FAFSA requires that you have certain data from your tax returns and your investments/retirement plans.  They have a formula that gives you what they think you can afford which colleges use for need-based aid.  

 

I actually did it as if my oldest was going to college a year earlier than planned just to see how it came out.  I also played with me working or not working, and it didn't make a bit of a difference.  It said that we should be able to contribute far, far more than we're comfortable with. No need-based aid here.

 

Then I did it this year because it was required for consideration for merit aid.  At that school, the FAFSA had to be done by April 1st for the first round of merit scholarship awards.  If a scholarship is turned down, you have a chance for a later round, but the financial aid people told me that the better scholarships are typically not turned down.  Schools vary on how they handle that though.

 

Issues like medical bills, upcoming retirement, etc. can be handled with an additional statement made to the college because the FAFSA doesn't have anything like that from what I saw.  Some will have room for this in the college online financial aid application, some will want a signed letter, and some want just the FAFSA, scores, an application, a transcript, and nothing more.

 

Some schools do make some merit scholarship awards solely based on PSAT/SAT/ACT scores.  Many use other criteria in addition to scores.

 

Nothing magic, I'm afraid.

[JanetC]

This will depend on the school.

1. There are two forms of determining family contribution: FAFSA and PROFILE, so you should check to see which your school uses. Generally speaking, the PROFILE asks much more invasive financial questions and results in a higher EFC.

 

2. The schools will chip in based on institutional budget and funding priorities (e.g. some school may prioritize athletes or religious affiliation or particular talents or scores). 

 

You can make a guess at a college price using the school's net price calculator. If you don't want to enter all the info at a bunch of different colleges, there is a general predictor on the college board website here:

 

https://bigfuture.collegeboard.org/pay-for-college/paying-your-share/expected-family-contribution-calculator

 

The college board is also the official net price calculator for many schools, here:

 

http://studentnpc.collegeboard.org/

 

You can also look up a college at the college board and find data as follows:

Search for the college, then pick "Paying" in the left menu bar and "Financial aid by the numbers" in the top menu bar.

 

Here is an example. My sample school typically funds 75% of financial need, but about 19% get full need met. This means if you want good aid you should be in the top 20% of their applicant pool. In addition, they offer merit scholarships, which means that they will discount below the EFC to get students they really want. Here, a typical amount is 13,000.  Merit aid typically goes to families who are price conscious but perhaps have a high EFC. You can drill down a little further (exactly how many students got that merit aid) at collegedata.com.

 

 

Other good things to note on this screen are the average loan amount, the average debt at graduation, and the percentage of students applying for financial aid. (It's a "rich kid" school if the price tag is 60K per year and only 40% of students bother applying for aid!)

 

Finally, I wanted to share this from the Middlebury college financial aid office. It's one of the more honest statements about college funding:  (http://www.middlebury.edu/offices/support/sfs/aid_apply)
 

 

9. The Estimated Family Contribution (EFC) is not what a financial aid office thinks a family has "left over" for college expenses after they have covered all of their living costs. Need analysis is much more a process of determining how much a family (including non-custodial family, in case of divorce) can afford to absorb in educational costs over time.  That means that a financial aid office will take into consideration all accumulated assets, annual income, and borrowing capacity.  How a family meets its EFC from those three sources is a matter of personal choice, but all of them will be considered.

 

 

 

Middlebury is PROFILE school and asks for a lot of financial information. The part about non-custodial parent would not apply to a FAFSA school, and is in fact only considered at some PROFILE schools not all.

 

Another really honest quote about financial aid here: https://jonboeckenstedt.wordpress.com/2015/04/11/the-death-of-merit-aid/(Emphasis is mine)

 

Before tuition started increasing rapidly at the same time family incomes started falling (be sure to set the year filter on this visualization to about 2000), a lot more families could afford college.  Those who couldn’t had to fill out a fairly simple form to determine EFC, or Expected Family Contribution.  The gap between the cost of college and your EFC was how much financial aid you “needed.† Only one problem, though: The thing right in the middle of the equation, that EFC figure, is pretty meaningless, or perhaps just not very precise. Like the “Peacekeeper Missile,†EFC was a label slapped on to deceive. In fact, it never really meant “Expected Family Contribution;†it was always simply a government index number designed to predict and control federal expenditures.

 

 

ETA: And, back to the original question: tutitiontracker.org is getting out of date (uses 2012 data), but it does break down family net price versus family income by school. Just don't count on it too much, since tuition is surely higher and financial aid may or may not have increased at the same time.

 

ETA2: Forgot to put in price calculator links

[Carpe Diem]

Thanks again. So there isn't a specific dollar amount that if one makes over that amount then no financial aid? It varies from school to school? Are we better to fund our retirements to the fullest with pretax dollars to reduce our income or does that not matter? I am not sure if I should take a part-time job if it pushes us over an income level. This is what I want to be sure I understand.

[Luckymama]

It is always best to fund your retirement as fully as possible :)

 

Aid varies crazily from school to school. Seriously, you can get whiplash when comparing offers!

[G5052]

Thanks again. So there isn't a specific dollar amount that if one makes over that amount then no financial aid? It varies from school to school? Are we better to fund our retirements to the fullest with pretax dollars to reduce our income or does that not matter? I am not sure if I should take a part-time job if it pushes us over an income level. This is what I want to be sure I understand.

 

The only way to know is to play with some of the net price calculators, and even that isn't a sure thing.

 

Some don't count retirement savings, and some do.  

 

Some have broader income bands than others.

 

A part-time job might or might not make a difference.

[8filltheheart]

There is a specific dollar amt. According to Forbes, it is 250k, with 1 dependent child, not considering the rest of the family financial picture. See:

http://www.forbes.com/sites/troyonink/2014/11/28/2015-guide-to-fafsa-css-profile-college-financial-aid-and-expected-family-contribution-efc/

ROTFLOL!!!! Yeah, right. Our income is no where near that with 5 dependent children. Our EFC is full pay at most instate public universities.

[JanetC]

ROTFLOL!!!! Yeah, right. Our income is no where near that with 5 dependent children. Our EFC is full pay at most instate public universities.

 

According to the Forbes table, for four dependents (table doesn't go to 5) incomes at 145,000 would be full pay at an in-state public. 

 

This table reminds me of the way bankers sell mortgages and try to get you into the most expensive house you can afford.  Yes, you are more likely to be eligible for aid at a more expensive school, but that doesn't mean the aid would be enough to make that school a financially wise choice...

 

We're going to try our hand at the merit aid game this fall, but DD must finish her apps to the in-state options first.

[8filltheheart]

I went and looked at the chart. It is does not represent what we saw. It doesn't factor in student contribution.....loan, work study, and summer income mean adding another $7500 to the total family contribution. Bc of the way FA is packaged you have to factor in both parental and student contribution to have the full cost picture. Bc they separate the 2 out it gives the illusion that the total cost is similar to the .95 cost.....not the higher dollar cost but the lower dollar cost. Like somehow people don't add the 2 together.

[Donna]

The FAFSA is a joke. My oldest ds was accepted at an expensive school. The FAFSA said we were able to pay X amount and the government would give us Y amount in loans (half subsidized and half not).  The school said they would give us Z in scholarships…with all that added up, there was still a ridiculous amount left over that we or ds would have had to take out loans to cover which would have left us or him in around $250,000 debt after 4 years of school (not counting the government loans). X amount (the EFC) was a lot more than we felt comfortable paying…we would have to hope nothing major happened in those four years like a hot water heater going or a car breaking, limit our other children's activities, and save nothing toward retirement.

 

Needless to say, oldest ds did not go to that college. 

 

 

[G5052]

The FAFSA is a joke. My oldest ds was accepted at an expensive school. The FAFSA said we were able to pay X amount and the government would give us Y amount in loans (half subsidized and half not).  The school said they would give us Z in scholarships…with all that added up, there was still a ridiculous amount left over that we or ds would have had to take out loans to cover which would have left us or him in around $250,000 debt after 4 years of school (not counting the government loans). X amount (the EFC) was a lot more than we felt comfortable paying…we would have to hope nothing major happened in those four years like a hot water heater going or a car breaking, limit our other children's activities, and save nothing toward retirement.

 

Needless to say, oldest ds did not go to that college. 

 

Yes, I peeked at the tables in the article, and they didn't reflect our reality either.

 

If DH wasn't on the brink of retirement, if I went back to work full-time in a professional capacity with a horrific commute, and if we left the 11th grader at home to school herself, we could have done the expensive school without loans.  We don't want that lifestyle and level of commitment.

 

And three out of four family members have ongoing medical issues; one with issues that are sometimes not covered by insurance.

 

And our house is at the point where things are going.  We will need a new roof, a new refrigerator, and new water heater soon.

 

Our vehicles both have nearly 100,000 miles on them.

 

But you know, my oldest is getting excited about college.  He's talking away about his classes, the clubs there, his part-time job, and doing things with his two friends who are already there.  He owns the decision.  My younger one is also talking about the same college with some interest and excitement.

 

So life is good!

[Tsuga]

The FAFSA is a joke. My oldest ds was accepted at an expensive school. The FAFSA said we were able to pay X amount and the government would give us Y amount in loans (half subsidized and half not).  The school said they would give us Z in scholarships…with all that added up, there was still a ridiculous amount left over that we or ds would have had to take out loans to cover which would have left us or him in around $250,000 debt after 4 years of school (not counting the government loans). X amount (the EFC) was a lot more than we felt comfortable paying…we would have to hope nothing major happened in those four years like a hot water heater going or a car breaking, limit our other children's activities, and save nothing toward retirement.

 

Needless to say, oldest ds did not go to that college. 

 

The FAFSA is not a joke. Private school tuition is a joke.

 

It is not the government's responsibility to fund private schools. You may take out loans.

 

There are many injustices in higher ed but the American public's failure to pay for your child to go to a private school is not one of them.

[Donna]

No, I stick by my statement. The FAFSA is a joke. It claimed our EFC was 1/3 of our entire (very modest, especially in our state which is the highest taxed state in the nation) household income leaving us about 150% above the federal poverty line after contributing that amount. We have a comparatively low mortgage, we have no new cars (all had over 150,000 miles), no dental insurance with a child needing braces, and we didn't own smart phones until after ds had decided he wasn't going to go to a private college. Silly us for working hard and saving a little money in the years before dh became disabled. If we had sat at home or knew how to game the system like a few families we know who somehow manage to get the American public to pay for their kids' education, one while driving a brand new Hummer.

 

Yes, the cost of attending private school or a state school for that matter…also a joke.

 

But you are correct…not an injustice. I could work full time, stop homeschooling my other kids, and stop all their activities that cost money (though we still would never have been able to afford Drexel). We weren't willing to do that. He went to community college. He will work two jobs while going to school and we will contribute the rest. I won't bother to fill out any more FAFSAs for the rest of his college and everything will be fine.

 

 

[8filltheheart]

The FAFSA is not a joke. Private school tuition is a joke.

 

It is not the government's responsibility to fund private schools. You may take out loans.

 

There are many injustices in higher ed but the American public's failure to pay for your child to go to a private school is not one of them.

Injustice and joke are not synonymous. It is completely a joke to think the majority of families are able to pay their EFC out of their income. Take Donna's example. Can most people just suddenly cut their living expenses by 1/3? No. That means loans to pay for college. But if Donna's kids are close together in age she will get approx a 40% decrease in in her kids' college expenses over another family whose kids do not happen to overlap in college attendance.

 

Your EFC is not split perfectly in 1/2 with overlapping kids, but it is close. So if your family is like Donna's (and probably most families) and require loans to pay for college, the biggest "sale price" by the federal govt is by having multiple kids in college at the same time.

 

So a family with only 2 kids who are twins compared to a family with 4 kids 4 yrs apart with all else equal (income and assets) will have a much lower expected total contribution to their kids' Individual college expenses even though the other family is raising more children and has higher expenditures due to family size.

 

That is a joke. Injustice, no, I agree. But financing college education with the loan amts currently approved with no financial proof that they can be paid back.....we as a country don't learn from history. It is a joke.

[creekland]

FWIW, we had a difference > 30K per year in what schools expected us to pay.  This is with the exact same financial information.

 

Needless to say, the most expensive school is not the one middle son is attending!

 

It's worth it to check out different schools as they don't all use the same formula.  A school that really wants an applicant and has enough endowment money can offer quite a bit more.  To be really wanted one tends to need either higher than normal stats and/or some sort of diversity (geographical, some special skill, some unusual ec, or similar).

[NoPlaceLikeHome]

The FAFSA is not a joke. Private school tuition is a joke.

 

It is not the government's responsibility to fund private schools. You may take out loans.

 

There are many injustices in higher ed but the American public's failure to pay for your child to go to a private school is not one of them.

I lean towards disagreeing with this statement. I think it is an injustice that potentially only the "haves" can afford a first class education like Stanford or Harvard or MIT. If our society values education, which I think it should, then it should somehow let all qualified individuals get a first class education.

 

20 to 30 years ago college costs were not a problem and it was often possible to pay you own way. I think having educated citizens benefits our society.

 

OTOH I agree that tuition costs are a joke all around and I am not sure what can be done about. Even many state colleges are very expensive nowadays. I now that I also disagree with college for all since I think many folks would be better off with trade schools and community colleges. I think the we should avoid dumbing down colleges which I think is happening in many instances.

[NoPlaceLikeHome]

Is the EFC listed in the table on Forbes the expected yearly contribution for college education or is it the total expected contribution for 4 years? I am guessing it is yearly contribution but I hope I am wrong :crying:

[8filltheheart]

Is the EFC listed in the table on Forbes the expected yearly contribution for college education or is it the total expected contribution for 4 years? I am guessing it is yearly contribution but I hope I am wrong :crying:

Per yr and it can go up depending on you assets if a school uses the CSS.