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What colleges don't want you to know.
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02/07/19
Issue #: 73
Hello!

Colleges will never miss an opportunity to complicate things, and financial aid award letters are the perfect example of this. Today's newsletter offers suggestions on how to better understand your financial aid award, along with a special offer for our readers! 

Thank you,


Jonathan West
Director
College Funding Group, LLC
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How to decipher your financial aid award letter
In mid-February, some colleges will start sending out financial aid awards. Other schools will follow over the next couple of months. As we’ve noted previously, college award letters are a source of confusion for many families.

Award letters vary from deliberately vague to simply confusing. However, armed with good information, you can make sure that you understand what the terms are.

***SPECIAL OFFER***
Each spring, we offer a limited number of free financial aid award reviews for families with current seniors.
If you are interested in reserving a spot, you can do so by clicking here to send us an email request:  Award Letter Review
 

Expect to find a loan in your package. Colleges routinely include federal student loans of up to $5,500 (for freshmen) in award packages. If you qualify for need-based aid, a portion of this loan will be called “subsidized”, and that portion will have slightly more favorable terms than the “unsubsidized” balance. If you do not qualify for need-based aid, the entire loan will be unsubsidized, but it will still be for the same total amount.

The loan is optional, but federal student loans do have some beneficial terms, including low interest rates, and favorable repayment options after graduation.

Some colleges include Parent PLUS loans in the aid package. This is a misleading practice. While PLUS loans are available to most families, they should not be included when you are trying to figure out what the college will cost your family. Loans answer the question “how” you will pay, not “what amount” will you pay.

If you get a grant or scholarship, make sure you know the answers to the following questions. (You may have to correspond with the financial aid office to be sure.)
  • Is the grant for one year, or can you expect it each year? For how much money?
  • Are there any grade performance requirements?
  • Is the award based on need or based on merit?
  • Does the money come from the school, from the federal government, or from the state?
Does the letter include an estimate of total costs for next year? Some colleges do not set their tuition until the May-June time frame, and others have already done so. Be sure you have an accurate idea of costs, including room and board and other expenses.

If you qualify, your award letter may include an amount for work-study. Work-study is an estimate of what the student will earn from working at school, in an approved work-study job. It is not guaranteed. It is optional. How many hours per week does the school expect you to work to earn the amount in the award letter?

Remember, financial aid falls into two broad categories: Free money like grants and scholarships, money that does not need to be paid back; and Loans/Work-Study, which is not free and must be paid back or earned. Your goal is to know exactly what the college is offering your family.

If we can help you sort through the confusion, please let us know.

P.S. There is some hope on the horizon. Bills are currently before the Legislature in Virginia to require improvement in state college award letters. 

Strange way to find a roommate

From Inside Higher Ed: A University of North Carolina-Greensboro student had noticed some odd happenings in her apartment over a few weeks: some clothes were missing, there was a hand print on the wall, and she heard noises coming from a closet which she thought might be a raccoon.

Turns out, the noise was from a 30-year-old man living in the closet. No word on how he got there. He's now in jail. 

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About College Funding Group, LLC:
College Funding Group, LLC provides individualized advice for parents and students concerning how to best pay for college.
College Funding Group
College Funding Group, LLC
3761-A Westerre Parkway
Richmond, VA 23233

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