All over the country, incoming college students are receiving their financial aid letters. For the first time, they and their families are finding out how much help they’ll be getting and how much money they’ll have to come up with to pay for school.
For some families it’s great news, while others are distressed by how little help they’ll be getting. College costs far too much these days for families to pay for it out of pocket, but nobody wants to be stuck with massive student loans, either. So, are there ways for you to increase your financial aid award?
Yes, there are some things you can do to increase the amount of your financial aid award. Here are some of our top tips and tricks for increasing your financial aid award.
Argue your case.
To let you in on a secret, the amount of your financial aid award is negotiable. Most people don’t realize this, and they just accept that there isn’t anything they can do. That’s probably because the FAFSA application doesn’t include space for you to present information like large medical expenses or unusual circumstances like caring for an aging parent.
As such, most people assume that the financial aid award is based on a very limited set of factors. However, if you have unusual circumstances that should be taken into account, it’s worth contacting the school’s financial aid office and making your case.
Let’s say you or your spouse just had a major operation, and you’ve got huge medical bills to pay. You might have to submit copies of those bills to the school, but odds are, you can get more in financial aid.
Sometimes parents who’ve recently been laid off are shocked to find that their child gets offered very little financial aid. The culprit here is typically the severance package, which can make it seem as though your income has increased dramatically, even though it’s only a one-time payment. This, too, is something you can clear up with a phone call.
Don’t be afraid to try anything.
If your child is being recruited by a school, you can almost certainly squeeze some more money out of them. If the college wants your child, they’re almost always willing to offer more money if they think it’ll seal the deal. Get creative, think outside the box, and start asking for more!
If there’s more than one school recruiting your child, don’t be afraid to pit them against each other. If their second-choice school is offering more money, tell their first choice about that offer and see if they’ll match it.
It might be too late for this now, but since you have to reapply for aid every year, it’s still good advice. A lot of the scholarships and grants that are awarded through FAFSA are given out on a first-come, first-served basis. Getting your application in early will maximize your financial aid award.
You can see the filing deadlines here, but file as soon as you can. You do not have to wait until you’ve filed your taxes to do this, so get those applications in as quickly as you can.
Minimize your taxable income.
The biggest factor that FAFSA looks at to determine your financial aid award is the expected family contribution, and that number is mainly based on your taxable income. We’re not suggesting you ask for a pay cut at work or anything like that, but there are ways to minimize your taxable income.
Ask your employee to hold off on any cash bonuses until after you’ve received the financial aid letter, for instance. Wait to sell any stocks or bonds, as well. If you’re moving or selling a house, the same advice applies. Anything which would boost your taxable income for the year should be done after you’ve received your financial aid award.
Don’t put college savings in your child’s name.
FAFSA assumes that students will contribute more of their assets towards tuition than their family will. So, if you’ve set up a nice college savings account and put it in your child’s name, it’s going to lower the amount of need-based financial aid you can receive.
It’s a good idea to empty those accounts and put the money into a 529 saving plan or Coverdale Education Savings Account. These allow you to put that asset under the parents’ name, and it won’t be as big of a factor when FAFSA looks at your assets.
Don’t stop at FAFSA.
FAFSA is a great tool, but it isn’t the only one. At most schools, financial aid counselors have a lot of discretionary authority to hand out aid packages. Talk to them directly to make your case. This is especially effective if your student has skills and experiences that are highly valued by that college.
Look at different schools.
The harsh reality of higher education is that schools reserve the best aid packages for their most desirable applicants. The students with the best GPAs, highest test scores and most appealing extracurriculars often get the most money, all other factors being equal.
Still, a student who isn’t particularly valued by one school might be highly desirable at another. That’s why it’s best to apply to several schools. One of them might just offer you a lot more money.
These are all great ways to increase your financial aid award. The more you receive in grants and scholarships, the less you’ll have to take out in student loans. So, even if some of these ideas seem tedious or the amount of aid they’ll get you looks minimal, they’re all worth doing.