Tips For Appealing Your Financial Aid Award

Most college financial aid offices mail their financial aid award letters in late March or early April.  Unfortunately, many families are not happy with the contents of these letters.  This piece will share a few tips on how to improve your financial aid award and get the money you deserve for your student’s education.

First, you should understand that your award letter can be improved – it’s not written in stone!  It’s actually a financial aid “offer” – meaning that it can be accepted or rejected.  Many parents who attend my workshop are surprised when I explain this.

The first thing I do when presented with an award letter is calculate how much the student deserved to receive. This way I have a benchmark to compare the award with, instead of merely crying “it’s not fair!”

How do you calculate a “fair” award?  By applying the financial aid formula and researching what percentage of financial need the college meets.

The financial aid formula is:

Cost of Attendance – Estimated Family Contribution = Need.

Cost Of Attendance means how much it takes to send your child to school for one year – tuition, room and board, insurance, travel expenses and so forth.

Estimated Family Contribution is a number that the government determines that you can afford to pay each year.  It’s derived from filling out the FAFSA (Free Application for Federal Student Aid).  You fill out the FAFSA, the Department of Education spits out the EFC.

(Most families are unhappy with their EFC because government formulas often have little relevance to a specific family’s financial circumstances.  For example, a family of 4 with an adjusted gross income of $100,000 and one student in college will have an EFC of about $20,000, or approximately 1/5 of their income.  There are ways to reduce your EFC, but that often takes advanced planning of a year or two.  So the best time to start is when your student is in 10th grade or earlier).

So if Cost of Attendance is $50,000, EFC is $20,000 you will show need of $30,000. (COA-EFC = Need).

The next step is researching how much need the college historically meets.  Perhaps it’s a generous school, and meets 90% – $27,000, leaving only $3,000 unmet.

I realize your eyes could be glazing over right now, so I’ll stop with the calculations.

If you’re still following, we just figured out that a fair award is $27,000.  If you receive close to that ($25,000-26,000), I might not bother appealing, but it depends on the allocation (grants vs. loans and work study).

But if you received $10,000 – $15,000, or less, sharpen your pencil and start drafting your appeal letter!

Here’s another tip –make sure you call it an “appeal.”  Don’t use the word “negotiate” – the theory (still unproven!) is that financial aid officers think that word is too transactional so to be safe, stick to the more academic ‘appeal’.

Write a letter not only to the financial aid officer who issued the award letter, but also the admissions person who signed the letter admitting your student.  Keep them in the loop – they have a vested interest in having you show up for classes. Why?

Colleges are obsessed with the “yield” – the percentage of admitted students versus those who enroll. The higher the yield, the better.   So keep the admissions officer in the loop.

Be very thankful and positive in the letter – tell them how much you appreciate the offer.  Describe how eager your child is to attend this prestigious school.  Then mention that, as it stands, it’s not enough for your son or daughter to be able to attend. If you can demonstrate that you were under-awarded, following the example above, do so here.

If you have background about your finances or other relevant information that did not show up on the initial financial aid forms, this is the time to explain it.  And use emotion to paint a vivid picture for the financial aid officer, who, for the most part, tends to be an actual human being with feelings!

If you were laid off, describe not only the financial impact but also the pain and suffering that you experienced. If you’re self-employed and your business suffered a downturn, this letter is the place to demonstrate it and make the reader feel that they’re right there with you.

Before you ‘appeal’, you should probably wait until you have received all of your ‘offers’.  That way, if you received a more compelling award from a competing university, you can mention it!  Use it to play one school off the other, particularly if you can honestly say something along the lines of “Your fine college is Charlie’s first choice, but he received $12,000 more in grants from Faber College. If you can come close to matching Faber, he’s coming to your school!”

One cautionary note – don’t bluff!  You’d better be able to prove that you were offered a better award package elsewhere, because you may be requested to produce it.

So, if you feel you’ve been ‘stiffed’, don’t despair just yet – in financial aid, it ain’t over until it’s over!

Peter “College Pete” Ratzan

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