Financial aid exists in two forms: need-based aid and merit-based aid.  They function very differently.

You can determine an estimate of your eligibility for need-based aid by going to a college’s website and putting your tax information into a Net Price Calculator.  This will give you a general idea of what to expect by way of need-based aid.  The formal application process is, however, more complex.  Need-based aid is normally calculated on the basis of two different forms and formulas.  The most common form, which is the one used most frequently by public institutions, is the Free Application for Federal Student Aid (FAFSA).  It is published and managed by the Department of Education.

This form can be completed at any time after October 1st of the year in which a student applies and makes use of prior-prior year tax information.  Completion of the FAFSA will allow you to be considered for the Pell Grant, Perkins Loan, Stafford Loan, work-study and other grants and loans that collegiate institutions may provide. Calculations for need (based on the FAFSA alone) are based upon the income and assets of a household only.  Family members who do not reside in the home, such as a divorced parent, are not included, but the income and assets of all people in the household, including step-parents, are included, regardless of legal agreements.  The FAFSA does not take into account current equity in a home as an asset.  It also does not consider debt such as auto loans or credit cards, so it would be wise to pay as much of those off as possible before filling out the FAFSA, thereby reducing your asset base.  About a month after you submit your FAFSA, you will receive a Student Aid Report (SAR), and notification of your Expected Family Contribution (EOC).  The difference between the EOC and the Cost of Attendance (COA) is your financial need.  Institutional approaches to how they fulfill that need will vary significantly.  Many, but not all, will meet 100% of demonstrated need.  This is, therefore, a good question to ask when you are visiting with a college representative.  Most institutions begin the creation of a financial aid package by granting loans, then add work study, and, if necessary and possible, grants.  Grants do not need to be paid back.

The College Scholarship Service, a division of College Board, provides colleges with the CSS Profile, which is an additional financial aid application form that many private colleges and universities employ.  Unlike the FAFSA, the CSS Profile is comprehensive in its review of a family’s income and assets.  It does consider available equity in a family home, as well as the income and assets of a divorced parent. The form also considers the value of real property such as automobiles.  While the FAFSA is standard for every college, usage of the CSS Profile varies from college to college and takes far more time to complete.

No matter which financial aid applications are required, colleges have many of the same beliefs.  They expect a family to sacrifice to send a student to college.  Do not expect to hold onto rental property or a second home, and receive need-based aid.  Colleges will attach all of a student’s assets for payment, including trust funds (regardless of restrictions).  They will only attach a percentage of the parents’ assets.

Colleges also expect financial aid application materials to be submitted on time.  Aid is usually determined on a “first-come, first-served” basis.

Merit based aid is largely institutionally based, and is typically used to attract highly competitive applicants (based on achievement in some category such academics, athletics, music or dance).  Fifteen years ago, a student would have had to be in the top five to ten percent of a college’s entering class (in one of those categories) in order to qualify for such aid, but that range has grown substantially at some institutions.  Institutionally based merit aid is granted in a variety of ways.  There are school-nominated scholarships that require high school officials to recommend a student.  Some examples of these are the Jefferson at Virginia, the Morehead-Cain at UNC at Chapel Hill, the Belk at Davidson, and the Wells at Indiana.  Many of these scholarships allow a limited number of nominees from a school and grant full tuition awards.  Some scholarships require a special application, but no school nomination to the college, in order to enter the competition.  An example would be the Dean’s Scholarship (full tuition) at Tulane University.  These scholarships often require an applicant to submit an admissions application by an early date. Many scholarships are awarded simply by a review of the student’s admission application and require no additional application forms.   The 1693 Scholars Award at the College of William and Mary, the Dunbar Scholarship in the Humanities at Denison University, and the Venable Scholarship at Hampden-Sydney College are good examples of admission office nominated scholarships.

There are many other types of scholarships given by different organizations such as professional associations, corporations, social groups, religious organizations, and community service groups, but these scholarships tend to be much smaller than institutionally based scholarships and often are in the $500 to $1,000 range.  Every little bit helps.  Scholarship mining tools (e.g. Fastweb)can help with this, but be aware of local opportunities such as the Elks Scholarship, the Norfolk Athletic Club Scholarship, All Saints Church Scholarship (based mostly on community service), and offerings from many military organizations.  One important caveat is that any money that you receive from one of these groups will result in a dollar for dollar amount reduction in aid provided by an institution.

The Virginia Tuition Assistance Grant (TAG) program provides automatic grants from the State Council of Higher Education to Virginia residents attending Virginia’s private schools.  Many colleges will apply this grant for you, but it is best to check with the college to determine its process.  The current grant (2016-2017) is $3,200 per year.

Finding merit scholarships is a bit time consuming, but there are tools to support your search.  I highly recommend fastweb.com as they have long been considered the gold standard scholarship mining tool in the business.  Naviance also contains a search engine.  You can always research a specific college’s scholarship opportunities by reviewing available information under the Finanaicla Aid and Scholarships tab on the college’s website.

As always, please reach out to us if and when you have questions or would like support interpreting a financial aid estimate or award.

Updated: November 1, 2016
Mrs. Jennifer Scott, Director of College Counseling
Norfolk Academy
Fall, 2016

Originally posted:
Mr. Paul Feakins, Director of College Counseling
Norfolk Academy
Winter 2014