1. Understanding Your Financial Aid Award Letter

2. Definitions
Cost of attendance (COA) – Estimated tuition and fees, room and board, books and supplies, personal expenses and some colleges include transportation
Net Cost - The net cost is the difference between total college costs and the gift aid (grants and scholarships)
Expected family contribution (EFC) – The measure of the family’s financial strength based on income and assets. The EFC is calculated by the information the family reported on the Free Application for Federal Student Aid (FAFSA), Oregon Student Aid Application (ORSAA) and/or the CSS PROFILE
Demonstrated Need – Demonstrated financial need is the difference between the cost of attendance and the expected family contribution. (Financial Need = COA – EFC)
Unmet Need - The unmet need, sometimes called a gap, is the difference between the full demonstrated need and the student’s need-based financial aid package. (Unmet Need = Financial Need – Financial Aid)
Financial Aid Award Letter - A letter received, via mail or , from the college(s) to which the student applied, typically. This letter will spell out the details of the financial aid package
Financial Aid Package - A collection of different types of aid from multiple sources (federal, state, and institutional). It is intended to help you fill the gap between your ability to pay (EFC) and college costs (COA)

3. Information To Keep In Mind When Evaluating And Comparing Financial Aid Award Letters
There is no standard format for financial aid award letters
Colleges may use different definitions of the cost of attendance. Some colleges don't even include the cost of attendance on the award letter. You can find detailed cost information in the college’s catalog or on their website
Colleges may award their campus based aid (FSEOG, Perkins Loan and Work Study) differently
Before accepting any aid, know the difference between the types of aid you are being offered. It is often easy to blindly accept and sign documents, especially since a click of a mouse will do the trick, without differentiating between aid you do not have to pay back and loan aid you must pay back
Families should compare college financial aid award letters based on the out-of-pocket cost, not the net cost
It is possible for the out-of-pocket cost to be less for a school with higher costs
Financial Aid Award Letters provide information for just one year
Rule of thumb - If the difference in out-of-pocket cost is less than $1000, the difference is not significant enough to affect the choice of college. But if the difference is greater, especially if it is more than $5,000, the family should consider the out-of-pocket cost along with other criteria when choosing a college

4. Types of Aid
Aid that DOES NOT need to be paid back. This is commonly called gift aid
Federal Pell Grant – Need based aid awarded based on your EFC
State Grants – Need based grants awarded based on individual state’s criteria. Typically these grants can only be used at colleges in the state in which the student is a resident
Federal Supplemental Educational Opportunity Grant (FSEOG) – Need based grant aid awarded by the college based on your need and the availability of funds. Funds are limited
Federal Work Study - provides part-time jobs to students allowing you to earn money to help pay education expenses. The program encourages community service work and work related to the student’s course of study. Funds are limited
Institutional Aid – Grant or scholarship aid awarded by the college based on criteria they determine
Private Donor Aid – Scholarships awarded by private donors such as community groups, businesses and organizations. These are competitive. The donor sets the criteria for eligibility

5. Aid that MUST BE REPAID
Federal Perkins Loan – Eligibility depends on your financial need and availability of funds at your school. Not all schools participate in the program. Fixed interest rate of 5%
Federal Direct Subsidized Loan (Stafford) – Eligibility is based on need. You are not usually charged interest during certain periods . The interest rate for loans disbursed on or after 7/1/17 and before 7/1/18 is 4.45%
Federal Direct Unsubsidized Loan – Financial Need is not required. Interest begins accruing immediately. The interest rate for loans disbursed on or after 7/1/17 and before 7/1/18 is 4.45%
Federal Direct PLUS Loan – Loans made to parents and are based on your credit history. Interest begins immediately. Payments begin when the loan is fully disbursed. The interest rate for loans disbursed on or after 10/1/17 and before 10/1/18 is 4.264%
Institutional Loans – Some colleges have their own loan programs. They set eligibility criteria and terms
Private Loans – Loans made by a private lender. Many private loans require repayment while you are still in school, may have a variable interest rate and may be based on your credit history.

8. Consider two colleges with different cost of attendance and aid package
College Name
Estimated COA
Gift Aid
Loans
Net Cost
Out of Pocket
Willamette
$63,624*
$30,300
$5,000
$33,324
$27,824**
Sample
$55,000
$23,100
$8,000
$31,900
$23,900**
*Does not include personal supplies or transportation
** Work study amount is not considered. The amount of work student is not a guarantee. Work study is paid as wages and depends on the amount of hours you work.

10. How To Reduce Costs
Buy used books whenever possible. There are many books you can find online, in your college’s library and may also be able to rent them
Shop around for books and supplies
Use equipment available to you on campus for free such as computers and printers
If you live off campus, shop at lower cost markets and make your own meals rather than eating out
Don’t get expensive cell phone plans, internet or cable/satellite TV packages
If you live on campus (many colleges require you to live on campus at least your first year) use your meal plan rather than eating out
Forgo the car. Many college’s provide free bus passes. Cars are expensive to maintain. The cost of parking is too!
Families – Personal care items make great gifts
Take advantage of student discount offers
Find out if there is a ride share program at your school. Share the cost of traveling instead of paying for the total cost of gas or a train/airline ticket
Use credits care wisely

11. Frequently Asked Questions
Do I have to accept loans – No
Do I have to accept work study – No, BUT it is advisable to do so. Since it is a limited fund, if you don’t use it you can lose it and won’t be able to change your mind. If you accept it and don’t use it there is no penalty
Can my financial aid be adjusted if my family’s financial situation changes? Maybe. The financial aid office might be able to make a professional judgment decision to account for the change. Talk to your Financial Aid Office to see what they may need and their policy to consider changes
Will I lose my aid if I don’t do well in school? It’s possible. You need to make satisfactory academic progress in order to continue receiving federal student aid. In other words, you have to make good enough grades, and complete enough classes (credits, hours, etc.), to keep moving toward successfully completing your degree or certificate in a time period that’s acceptable to your school
Are there limits to the amount of financial aid I can get? Yes. Limits vary based on the type of fund
Do I have to tell the Financial Aid Office if I get a scholarship? Yes.
Will the Financial Aid Office adjust my financial aid package if I get more scholarships? Yes.

12. Additional Resources
Your college’s Financial Aid Office your best resource for most of your questions
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13. Thank you to the following for sharing their resources in the production of this presentation:
FastWeb LLC
FinAid Page, LLC. Mark Kantrowitz, Founder
ASPIRE folks at McKenzie and Pendleton High Schools
Karen Wiant, Willamette High School College and Career Center
The Scholarship Foundation of St. Louis