To qualify for any form of federal aid, work-study, or a college's own private loans, a student will have to first fill out a Free Application for Federal Student Aid (FAFSA) from the U.S. Department of Education. FAFSAs are designed to determine how much students and their families can afford to pay toward the student's education. It is best to fill out a FAFSA after completing your family's federal income tax returns, but you can also file the application with estimates if you have not filed your taxes before the FAFSA deadline for a given school (and then adjust later).
The application asks a series of questions to reach an estimate of what a family can likely afford to pay (the "Expected Family Contribution" or "EFC"). Most schools will take this EFC into account, and then apply their own personal formulas to determine how exactly to allocate individual aid awards. The EFC can be zero, without hurting a student's chances of receiving financial aid. FAFSAs are free and can be filled out electronically at www.fafsa.ed.gov. Additionally, The College Board offers a free EFC calculator that you can use to estimate what your EFC might be. You'll find the free calculator on the College Board's website at http://apps.collegeboard.com/fincalc/efc_welcome.jsp.
The common belief that a private school education costs more when compared with public schools is only partially true. While private schools do have higher tuition rates and costs of attendance (the "sticker price"), they also have a much greater amount (and variety) of assets they can use to provide financial aid to students.
Many public schools -- though they do have lower tuition rates -- also have less in the way of endowments or private assets they can use to offer grants or scholarships. As a result, loans may make up a larger part of their aid awards. Public schools have also been raising their tuition at higher rates in the past decade, compared with tuition hikes at similarly ranked private schools. This can mean that a student with enough need, or merit, will end up paying less at a private school with a higher sticker price than at a public school with lower tuition.
The truth is that -- for public and private schools alike -- college is more expensive now than it has ever been, and less "free" money (grants or scholarships) is available for students. Loans are still readily available, but interest rates on them have risen in the past decade. That said, it is still completely possible to find an affordable college experience, and many colleges still meet the great majority of their students' financial need.
If you're interested in a particular college, it might be wise to ask directly about its approach to a particular financial aid factor (or ask any other question you might have). Colleges know that higher education is expensive, and any accredited school will have a financial aid office -- designed to answer questions, process financial aid applications, and help students figure out how to pay for college.
Learn more about how a financial aid is set by reading Nolo's article Financial Aid: Factors Influencing Your Award Amount. And, if you're headed to grad school, check out Nolo's article Paying for Graduate School: How to Finance Higher Education.
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