It used to be that a leading reason for not applying to Ivy League colleges was the cost. But many savvy applicants and their parents these days know that cost is no longer an obstacle, due to the generous financial aid philosophy that most Ivies have.
Granted, Ivy League institutions do carry big sticker prices. In fact, if students were to pay the full cost for a four-year degree - tuition, board, fees, etc., - the bill could total a quarter million dollars - or more.
But a fair number of students do not pay the full sticker price. Not even close. And many, indeed, pay zero tuition - repeat, zero.
Several years ago, with Yale and Harvard leading the way, Ivies began to offer free tuition to students whose family income did not exceed certain thresholds. In other words, simply put, if your family did not have more than, let's say, $100,000 in income, you received a free ride.
Thresholds vary from school to school, and the policy is not limited to just the eight Ivies in the East. Stanford, for example, has quite a generous package to offer. (IMPORTANT - Interested applicants and their parents should be sure to check with the individual colleges for the specifics of their financial aid policies - details may vary from institution to institution.)
Getting admitted to these very selective colleges, of course, remains a challenge. But these days cost should not deter qualified candidates from applying.
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For a more complete view of the college admission process, and strategies to use when applying to the Ivies and other institutions, see Dr. Droge's book: College Admission - click here
Showing posts with label financial aid. Show all posts
Showing posts with label financial aid. Show all posts
USING TAX-EXEMPT 529 PLANS TO HELP PAY FOR COLLEGE
A “529 Plan” is a tax-exempt way to save for college. The
name “529” comes from the section in the IRS tax code that covers the details
of the plan.
Here are the basics:
Colleges, state offices, banks, and other financial
institutions can help to open a 529 account for you. Simply put, you make
contributions to the account, which you use for eligible college expenses, and
you need not pay federal taxes on the money earned in that account.
There are two variations of plans, but not all states carry
them both.
One type, available in most states, is more or less a
straight savings plan, with tax benefits.
The other plan locks in the current tuition at a selected
college, and prepays that tuition as the account builds with deposits. Any rise
in tuition over the years will not affect such a plan. A family may open a plan
well before the student is in college or even high school, which will insure
that they avoid tuition increases and that they know just how much the college
tuition for that student will cost them.
Please note - not all states have this type of plan available. Check with your state to determine.
The specific details of 529 Plans may vary from state to
state – for example, which colleges are eligible, and exactly which tax
benefits are connected, and which particular college expenses may be involved,
such as tuition, books, computers, and room and board.
FINANCIAL AID BASICS - AND VALUABLE TIPS
FINANCIAL AID BASICS
You may have thought that there were only two things we can
be certain of – death and taxes. But you
forgot to include rising college costs.
Despite softer increases in recent years, the total expense at some
private colleges - including tuition, fees and expenses, room and board – is
more than $60,000 a year. Do the math – for
those big-ticket institutions that’s almost a quarter of a million dollars for
the 4-year degree. Most other private
colleges and virtually all public colleges are less expensive, but the overall
cost still promises to be quite formidable.
Not surprisingly, most students and their parents apply for
financial aid. The types of aid
available, and the requirements to obtain it, vary from college to college, but
for those students and parents just starting to explore this area, here are the
basics:
- Most colleges offer financial aid
of some sort, and the amount offered may be based on the level of demonstrated need
(need-based) or achievement (merit-based).
The aid may come in various forms, for example, grants, scholarships,
loans, or work-study arrangements, and may derive from various sources
(college, government, bank, etc.).
- The differences:
Grant – this is, essentially, a gift that does not have to be repaid.
Scholarship – this, too, is a gift, usually based on achievement or
need.
Loan – funds backed by the government, the college, the bank, or
some other resource, will be provided, but you will be required to pay it back
– with interest.
Work-Study – the student gets a funded job, usually on campus and
part-time, and the money earned may be used for school expenses.
-
Not surprisingly, there are forms to fill out. Most often the work is done online, but paper
forms may be provided upon request. Applicants
will be required to show need, based in no small part on the information
recorded on their tax returns.
-
One of the primary forms to be filled out is a FAFSA – Free
Application for Federal Student Aid – along with other forms of the particular
college. Some colleges may also require a form called a CSS/Profile, which
provides additional need analysis. For
information about the FAFSA visit https://fafsa.ed.gov/ . For information about the CSS/Profile
visit http://student.collegeboard.org/css-financial-aid-profile .
-
The nuances and resources of financial aid may vary
from college to college. Students and
parents should always check with the individual colleges to determine exactly
what they require.
TIP#1 - NOTE WELL: Some colleges, like the Ivies, have
substantial endowments that permit offering significant financial aid,
especially in the form of grants.
Students and their families should not shy away from applying to an Ivy
League school simply because of the apparent high cost. Often, the financial aid package will make
the final expense lower in the end than many other colleges.
TIP#2 - Depending
on the college, the initial financial aid offer may not be set in cement. There may be some flexibility. If you decide that you cannot attend the
college because the financial aid package does not bring down the cost quite
enough, do not hesitate to call the college to let them know that. If possible, speak with the Director of
Financial Aid directly. Make it clear
how much you want to enroll, how much you have been looking forward to it, how
much it is such a good match – you and the college. State your case politely but confidently, and
ask if there is any way that the package can be improved in order to permit you
to attend.
The people in financial aid know that the college admits
only those students it wants. It knows
that the admissions office would like you to enroll. And, so, in most cases, the financial aid
office will try its best to find some way to improve the package. But, in the event that it is not able to do
so, at least you know that you – and probably the financial aid office – tried
hard to make it happen. But, no matter
the outcome, if you have been accepted, the effort will begin only if you make
that initial phone call to the financial aid office to tell them about your difficulty.
When building a list
of colleges to apply to, consider the costs, but do not immediately eliminate
any college because it appears to be too expensive. With a good financial aid package, the annual
cost may indeed be manageable.
For a more complete look at the college admission process, see COLLEGE ADMISSION: A Simple, No-Nonsense Guide To Getting Into The College Of Your Choice. CLICK HERE
For a more complete look at the college admission process, see COLLEGE ADMISSION: A Simple, No-Nonsense Guide To Getting Into The College Of Your Choice. CLICK HERE
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