This is the time of year when parents begin agonizing about whether they should apply for financial aid.
They wonder if filling out the FAFSA and, if applicable, the CSS/Financial Aid PROFILE, will hurt their chances of getting admitted.
If you think you’re going to require financial aid, you should always apply for assistance. For the majority of students, their need for aid should not impact their ability to get into a school or receive financial assistance. Financial aid, by the way, can include grants (free money) and loans.
Schools maintain different policies in regards to how generous they are with applicants, as well as how they handle the applications of teenagers who require assistance to attend college.
Here are two of my favorite posts that explains a couple of ways that you can gauge whether a school has a generous financial aid policy:
Anatomy of a Stingy College and a Generous One
College Cost Calculators: Getting Wildly Different Answers
Definitions of Need Blind and Need Sensitive Schools
To understand how schools deal with financial aid requests, you need to know the definition of these terms — need blind and need sensitive or need aware admission policies.
Need Blind Schools
When a college maintains a need blind admission policy, it accepts students without regard to the applicant’s financial need. That might sound great, but this approach can create heartache for plenty of students. Why? Because many schools that call themselves need blind will not provide sufficient money in their financial aid packages to allow students to attend their schools without committing financial suicide.
Let’s say a teenager, whose mom is a clerk at WalMart and whose dad is disabled, gets into a school that costs $50,000. The family celebrates until they realize that the financial aid package only includes a $20,000 grant. Where the heck is the family supposed to come up with the other $30,000 for the first year, much less the other three years?
The above hypothetical case illustrates the higher-ed phenomenon of gapping. There’s a gap –sometimes quite huge — between what a student can afford and what the school is offering in its financial aid package. When the gap is large, I’d argue that it would have been better if the college had rejected the student outright instead of hiding behind their need-blind admission policy. Rather than outright reject some students, colleges will provide such a miserable financial aid package that they assume the teenager will attend a different school. Unfortunately, some families don’t take the hint.
Need Aware or Need Sensitive Colleges
At schools with need-aware policies, schools do examine the financial need of students. At many, perhaps most schools, the majority of students, however, are selected regardless of their financial neediness. Using this approach, a school will accept most of its freshmen class without any regard to its financial bottom line. For the last 10%, 20% or 30% of slots, however, a school may start looking a the financial ability of applicants, which will favor rich students. With this admission approach, the students who are marginal applicants AND financially needy can be rejected.
I once talked to an admission rep from Colgate University, for instance, who estimated that 90% to 95% of this liberal arts college’s freshman class is selected without regard to need. By the time that many students have been accepted, the financial aid money has run out. At that point the need-aware policy would kick in and the remainder of the class would be selected among applicants who don’t need financial aid.
If you want to get an intriguing view of how a need-aware policy works — warts and all — check out this story about Reed College in The New York Times. It illustrates how weaker applicants, who are rich, can benefit from a need-aware policy.
College in Need Closes A Door to Needy Students
Who should be worried?
Under either financial-aid approach, a great candidate who requires a lot of financial aid will typically not have to worry. It’s the students who require a lot of assistance and are in the bottom half of the applicant pile who could get short changed financially or simply rejected.
More from The College Solution:
Should You Apply to a Reach School?
Winning College Admission Essays
Lynn O’Shaughnessy is the author of The College Solution, an Amazon bestseller and a workbook, Shrinking the Cost of College: Great Ways to Cut the Cost of a Bachelor’s Degree. Follow her on Twitter and Facebook.