Applying to "Expensive" Colleges: How Need-Based Financial Aid Works

Many people think that the top colleges in the nation are out of reach because of the expensive cost of attendance. However, most of these selective schools offer some of the best financial aid packages in the nation. The financial aid is primarily need-based and grant based, meaning that it does not need to be paid back like student loans. At a number of highly selective colleges, students from families earning below a threshold set by each college, with typical assets, are not expected to pay anything to attend, and some colleges also cover full tuition for families earning somewhat more. These thresholds differ from college to college, have risen at several schools in recent years, and often come with conditions, such as limits on family assets, so check each college's financial aid website and net price calculator. This means that for low-income and middle-class families, cost at these selective colleges may be just as or less expensive as in-state public schools. However, this will vary based on the college's financial aid package and in-state tuition benefits. Going out of state for college is not necessary for all students because of the great state schools our country has, but for those who want to, the cost may not be as much as they first thought.

Some colleges are better than others regarding financial aid so in-depth research should be done while selecting colleges to apply to. Even for families that are well off, financial aid may be available. For instance, at some top colleges financial aid is available to families making more than $200,000 a year. Although financial aid is typically very good at top colleges, it may not always cover everything or be affordable. Depending on financial circumstances, federal work-study and federal student loans are often available for additional assistance. Federal Work-Study and Direct Subsidized Loans are based on financial need, which a college determines by subtracting the Student Aid Index (SAI) calculated from the FAFSA, which replaced the expected family contribution, from its cost of attendance. Direct Unsubsidized Loans do not require financial need. These loans will help, but dependent first-year undergraduates can borrow at most $5,500 in federal Direct Loans (no more than $3,500 of it subsidized, meaning the government pays the interest while the student is enrolled at least half-time). This amount increases throughout the undergraduate years. Even if eligible for loans, the cost of attendance may be too high, which means public state schools are a good option that will provide a great education.

To qualify for financial aid at top private colleges, the CSS profile will likely need to be completed. This is similar to the FAFSA, but provides a more complete picture of a student and family's financial circumstance. This must be completed through the College Board. Research a specific college's financial aid application requirements to see if the CSS profile must be completed.

Students determined to attend the top colleges in the country should not immediately be deterred by the cost of attendance as this is highly variable based on the individual student. For many, it will be much more affordable than they first thought. Attending one of these dream schools should not be thought of as impossible for any student, and the goal should be pursued if desired.