College Planning Lingo Guide
There are a ton of phrases, acronyms, and words in the college planning world that leave the average high schooler (and parents of high school students) scratching their heads in confusion.
This quick college planning lingo guide will tell you what’s what and clear up any of that confusion for you.
We’ll keep it short and sweet, with a brief description of what it means or how it relates to the college planning process.
Free Application for Federal Student Aid. This is the financial aid paperwork you absolutely need to fill out if your student is planning on attending any institution of higher learning (including 4-year universities, 2-year colleges, technical, cosmetology, etc.). Not filling out this form is one of the biggest mistakes families out there make that causes them to overpay for college. Even if you think you make too much money, you should fill this form out for your student to receive merit-based aid (scholarships). Follow this link to visit the FAFSA website.
Cost of Attendance. This is a simple one. It is the cost for the student to attend, including tuition, room & board, transportation, books, fees, spending money, etc.
Expected Family Contribution. This is calculated by filling out the FAFSA. This is the current acronym used (this acronym will be changing soon) for what the federal government believes you should be able to pay each year for your student to attend college, regardless of if you plan on helping your student pay for college or not. The EFC greatly impacts the award letters you receive from each college.
Student Aid Index. While currently, the FAFSA produces what is referred to as the “EFC” or Expected Family Contribution, it won’t be for long. They will be renaming EFC to SAI, even though it will still mean the exact same thing (see description in point before this one).
A good equation to know: COA – EFC/SAI = Need (need is the amount the college will try to cover in its award letter, but will very likely fail to cover)
Student Aid Report. This report is a summary of the answers you provided on the FAFSA. You should receive the SAR 1-2 weeks after submitting the FAFSA. This aid report may arrive sooner if the email address is provided. It can also arrive later if by snail mail.
Any financial assistance (free money!) that is based on the family’s income. You can’t receive more need-based aid than what your family’s financial need is. Remember: Need = COA – EFC/SAI. While a college cannot offer more need-based aid than your family’s need, they can (unfortunately) offer you less than your need.
Any award (free money!) that is in response to student accomplishments (academic, athletic, artistic, etc.). Public colleges tend to award far less, meanwhile private colleges are able to award far more (thank you endowment funds!). Remember: need-based aid cannot exceed the “need.” Meanwhile, there is no cap for merit-based aid.
A financial aid option for need-based students. The student receives a simple on-campus job. In return for the hours worked, the student will receive money toward his or her tuition. That money is tax-free and it flows directly from the federal government to the college to offset tuition.
We hope this information has been helpful for you. Check back next week for more advice about the college planning process!