How do colleges determine your financial need?

What is Financial Need?

First, financial need does not mean the amount of money that you think you will need to go to college. Instead, financial need is a calculation made by a college that has accepted you of the amount of money that they believe that a school would need to help your family find a way to afford so that you may attend that school. This amount is calculated by taking the total Cost of Attendance and subtracting from it the Expected Family Contribution. The amount left is then taken into consideration by the college to calculate the size of your financial aid package.

Cost of Attendance

The Cost of Attendance means the cost of attending the college for a year. This amount includes tuition and fees, living expenses, transportation, college textbooks and supplies, and so on. It is a big lump sum that includes all the different expenses you would expect to meet while attending the college for a complete academic year.

Expected Family Contribution

The Expected Family Contribution is the amount of money that the school believes that your family is capable of paying for a full academic year of college. In order to calculate this amount fairly and accurately, most schools will require that you and your family fill out two forms: the FAFSA (Free Application for Federal Student Aid) and the CSS/Financial Aid Profile (College Scholarship Service/Financial Aid Profile). These forms will include information about your parents’ adjusted income and assets as well as your own income and assets. Usually the school will then multiply each of these factors by a certain percentage to find the amount that they believe your family can pay per year. Afterwards, the school will subtract this sum from the Cost of Attendance. The amount left is your Financial Need. This Financial Aid will affect the size of the financial aid package that you receive, depending on the amount of money that the school has to offer. Please remember that schools do not always have gigantic foundations and endowments that allow them to meet financial aid dollar for dollar. A school may accept you, calculate your Financial Need and then find that it is unable to offer you much in the way of financial aid.

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