What is Your Expected Family Contribution?
Do you know what the term Expected Family Contribution or EFC means?
Most of you probably don’t so I’m devoting the next couple of college blog posts to explaining what an Expected Family Contribution or EFC is and why it’s so important.
If you file for financial aid through the Free Application for Federal Financial Aid, you will automatically obtain your EFC, but I think you 
should get this figure long before your child is a senior in high school.
You should also retrieve your EFC even if you think that there’s no chance that your family will qualify for need-based financial aid. Plenty of people who assume that they won’t get need-based aid do qualify, especially if their children attend expensive schools.
To appreciate why I’m always telling people to figure out their EFC, you need to understand what it is.
What Your EFC Means
An EFC is the amount of money, at a minimum, that a college will expect you to pay for one year of your child’s college education. Often times you will have to pay more than your stated EFC unless you’re attending an elite school with excellent financial aid packages.
Your EFC will be expressed as a dollar amount. A low-income family could have an EFC that’s as low as $0. There is no ceiling to how high the EFC can be for wealthy families. The highest I’ve ever seen personally was $108,000 for a family where the father was an executive in a national chain of restaurants. Obviously, $108,000 is way above the price of one year’s costs at any college.
Why You Need Your EFC
Generating a preliminary EFC figure will allow you to know what kind of financial commitment you could face when your child heads to college. Getting advance notice is better than waiting until your child receives his or her financial aid packages in the spring of her senior year in high school.
Even if you have a high EFC (you’re rich), it’s still good to know this because then you can focus on finding schools that provide merit aid (in higher-ed lingo it’s called non-need-based aid) to affluent students. Luckily for these kids, most schools award merit aid. The only ones that don’t — there are probably no more than three or four dozen — are the Ivies and other super elite schools. These schools don’t need to give out merit aid because they have rich kids flocking to their schools and their parents will pay whatever price necessary to get into these institutions.
Next time I write, I’ll explain how you can obtain your EFC.
Read more at The College Solution:
Is Your EFC Too High?
College Admissions: The Rich Kid Advantage
Lynn O’Shaughnessy is the author of The College Solution and she also writes college blogs for CBSMoneyWatch and US News & World Report.
Learn more about The Ultimate College Workshop that will be held on Oct. 15 at the University of California, San Diego.
My son just got his award package. It’ s what was expected based on efc. I spoke to admissions about the following year when I will have 2 sons in college. She told me that my efc in essence would be divided by two sons BUT When I asked if my sons aid would increase she said that his need-based aid would not change. She said that my second son would appear to have more need and likely get more aid. This did not make sense to me. She told me that if my efc goes down because of a second child, then I could appeal. What’s the point of filing fafsa if the financial aid package doesn’t change to reflect the situation ?
Hi Lisa,
I suspect that the school your son is going to must have a poor need-based aid policy. That makes no sense that the need award wouldn’t budge when your EFC drops when a second child starts college. I’d love to know what the name of this school is!
Lynn O’Shaughnessy
As I watch my daughter start her college applications, I’m cringing inside because she’s wanting to apply to out of state public schools such as UCLA, Georgia Tech and Purdue. Although Purdue states that it does have scholarships to out of state students, I’m worried that this will end up being a waste of time and the cost of the application fees. I would add “public schools in other states” to the list of schools that generally don’t give merit aid.
Hi Patty,
Some schools do provide scholarships to out-of-state students, but typically they have to be at the top of heap in terms of applicants. Even then the scholarships won’t always be generous. I would urge your daughter to take UCLA off her list. That school does not provide merit aid to nonresidents so the cost will be about $53,000!
Use each school’s net price calculator to determine how much these schools would cost you. And make sure the calculators take into consideration that your daughter is a nonresident.
Lynn O’Shaughnessy