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How to Determine If You Can Afford the College of Your Choice

If you, or your child, are attending college, and looking for financial aid, you are probably worried about how much you may have to borrow and how much debt you will incur. Millions of Americans are struggling with student loan debt (which has creeped over $1 trillion nationally) and you don’t want to be one of them. I don’t blame you. So here is how you can keep that from happening.

The Financial Aid Package

The solution starts after you have completed the FAFSA form and received your Student Aid Report (SAR). If you listed the schools where you have been accepted, then the report will be automatically sent to them. If you have not, then you can add those schools by revising your FAFSA.

Once the schools receive the SAR, their financial aid office will send you an aid offer (often electronically). It will include the types and amounts of financial aid you may receive from federal, state, private, and school sources. This combination of aid is called your financial aid package. You use this to determine your strategy of financial aid.

Can You Afford the School?

This is a big question, as costs of attendance vary, and as such, so will each school’s financial aid package. If you cannot afford to attend the school without borrowing money, then affordability becomes key.

In order to determine affordability, you have to know the “net price” of the school. To do this, should

  • Find out the cost of attendance for the school. It is usually in the financial aid package, but if it isn’t ask the financial aid office. Make sure that it includes amounts you will pay to the school directly (such as tuition and fees) as well as other costs (such as living expenses, books and supplies, and transportation).
  • Then subtract the grant and scholarship amounts from the aid offer, along with any money in your college fund.
  • Then compare this figure for each of the schools you are considering to see which one offers the best bargain and will require you to borrow the least amount.

In doing this, you will be able to make the most informed decision about the cost of your education and minimize the debt you will have upon graduation.

Consider Community College

A two year community college program can be a great way to save money on your college education. They are, on the whole, far less expensive than four year colleges, and as long as the credits are accepted, can make a bachelor's degree from the college of your choice more affordable. You should definitely look into this!

More Information

If you are looking for more information about federal financial aid for college, then download my free book, Applying for Federal Financial Aid: The Definitive Guide for Students and Parents.

For more information about what happens after you graduate, get my free book, I Graduated; Now What? A Guide to Dealing with Your Student Loans.

You can also access the latest news on student loans, get answers to Frequently Asked Questions, and read articles in my Library. Continue to educate yourself as you go through the process of making smart decisions about college financing!

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