In my last post on deciphering financial aid letters, I focused on college grants. Grants are the best kind of aid that you can snag in a financial aid letter because these awards don’t have to be repaid.
College Grants: Decoding a Financial Aid Letter Part II
My son has been receiving financial aid awards from colleges during the last week or so and it’s the grant aid line items that I check out first. So far, I haven’t been disappointed.
Today I want to focus on how teenagers can maximize their college grants. For starters they may want to ignore the advice that high school counselors have been dispensing for decades: apply to safety schools and reach schools.
Applying to reach schools, however, will often jeopardize the college grant money that a student could receive. Here’s why: Colleges have a finite amount of money to award to freshmen applicants so they typically reserve their best offers to the high school seniors that they covet the most.
Beware of Gapping….
Often if your child isn’t in the top 25% to 33% of a college’s applicant pool, he or she is more likely to be gapped. When gapping occurs, the school accepts the student, but the financial aid award is so low that the applicant will usually attend a different school.
In some cases, the gap between what a family can afford and what the school offers can be tens of thousands of dollars. Often the students in this category are middle- and low-income students who are in the bottom half academically of the accepted students.
Knowing of this danger, my son didn’t apply to any reach schools. He applied to liberal arts colleges where he was in the upper range of applicants. Because he picked the schools carefully, we haven’t had any surprises. Ben has been accepted into all the schools that he’s heard from so far. Each college has given Ben about $20,000 in a combination of merit and need-based grant money. With this assistance, Ben will enjoy the luxury of picking the college that he really wants to attend.
If Ben had aimed for schools where he barely qualified, he might have received little or no grant money.
There are some occasions when applying to reach schools could be a good idea. Here’s a notable one:
A few dozen of the nation’s most elite schools will routinely meet the financial aid need of any of its applicants with grants rather than loans. Your child could be the last kid accepted into a school like Amherst or Yale, but he or she would still receive a great financial aid package.
Lynn O’Shaughnessy is the author of The College Solution and she also writes about college for CBSMoneyWatch. Follow her on Twitter.
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there is absolutely nothing wrong with applying to a reach school. The problem i have with this article is for some reason it that it says you should only apply to schools you think will give you good financial aid. Kids should apply to all the reach schools they want because there is a chance that that school offers a good financial aid package or you find a way to pay. there is nothing wrong with being accepted to a school and not going because of financial challenges.
My thinking is that a reach school would probably be a stretch academically and would cause undue struggle and stress when another school might be a better fit.
That could be true, but there have been studies that students who are in schools a bit above their abilities tend to rise to the occasion and do better than if they are at a college where they are at the top of the heap. I’ve written about this phenomenon in the past.
I agree that a reach school will not give the best aid (except maybe HYP). However, I don’t see anything wrong with applying to one as long as both the student and the parents understand that money has to be considered in all college decisions.