When I was in my last semester of high school, I checked my family’s mailbox just as much as I checked Snapchat and Instagram combined. It was the season of admissions decisions, and I was getting letters from all the colleges I’d applied to.
But once I’d gotten into several schools, my attention shifted to my e-mail inbox. I was waiting on information that was just as critical: my financial aid offer from each college. I knew that for me, the amount of financial aid I got from a school mattered just as much as the general admissions decision. I’d fallen in love with each of the schools I’d visited, and I knew I’d be happy anywhere. Basically, my choice was going to come down to the money.
Analyzing different aid packages can seem like way too much math for the end of your senior year—at least it did to me—but it’s important stuff. Check out my four steps to make this analysis simpler.
What to do once you get an aid offer
1. Make sure you know what you’re looking at.
The financial aid offer (sometimes called an award letter) typically comes in an e-mail from the college’s financial aid office. The offer includes the types and amounts of financial aid you’re eligible to receive from federal, state, private, and school sources. Be sure you understand what each type of aid is and whether it needs to be paid back. For example, when I got into UNC-Chapel Hill, my aid offer was a mix of scholarships, which I didn’t need to pay back, and private loans, which I did. My offer from Duke (booooo) had mainly the same stuff with some grant money mixed in.
Click to download PDF.
Lucky for you, hundreds of colleges nationwide have signed on to present financial aid offers in a standardized format known as the Shopping Sheet. The Shopping Sheet is a standardized award letter template that makes it easy to compare financial aid offers from different schools. In addition to providing personalized information on financial aid and net costs, the Shopping Sheet also provides general information on the college, like graduation rate and loan default rate.
Today, more than ever before, a college diploma or job-training credential is one of the best investments you can make in your future. By some estimates, a bachelor’s degree is worth an average of a million dollars over the course of your lifetime.
But college also has never been more expensive, and far too many Americans are struggling to pay off their student loan debt.
Maybe you haven’t quite landed that dream job in your field of study yet. Or you decided to go into public service instead of taking the highest-paying offer. Your reward for investing your time and money in the skills and knowledge needed to secure your future shouldn’t be a sky-high monthly payment.
A college or career school education = more money, more job options, and more freedom. Yet, with more than 7,000 colleges and universities nationwide, deciding which college is right for you can be difficult. Maybe you want to find a school with the best nursing program, or study abroad options, or the best college basketball team; every person values different things. However, it’s also important to remember that college is one of the biggest financial investments you will make in yourself. Just as important as academics and extracurricular activities are the financial factors: how much a college costs, whether students are likely to graduate on time, and, if alumni are able to find good jobs and pay off their loans. That is why the U.S. Department of Education developed the College Scorecard. It provides clear information to answer all of your questions regarding college costs, graduation, debt, and post-college earnings.
As you’re comparing colleges, use the College Scorecard to compare these four things:
1. Net Cost
For starters, you should consider how much you’ll actually be paying on an annual basis. That’s not necessarily the sticker price, but it’s the sticker price minus all of the scholarships and grants that you will receive when enrolling in an institution. This is called the net price, and it’s important because it’s the average amount students actually pay out of pocket.The College Scorecard can show you the average net price of each school compared to the national average. It can also give you a net price estimate for each school broken down by family income. Here’s an example:
Students discuss college affordability during a recent town hall. (Photo credit: U.S. Department of Education)
“Who thinks college is affordable?”
Secretary Duncan and new Under Secretary of Education Ted Mitchell posed that question to a packed room of college students and freshly-minted graduates at a recent town hall on college costs and access.
Almost no one raised a hand.
A college education is still the best investment students can make in their future. It is also a critical investment that we can make as a nation. But right now, this important rung on the ladder to opportunity is slipping out of reach for many low- and middle-income families in America.
That’s something President Obama is determined to change. Since taking office, the President has made key investments in education and advanced an ambitious agenda to combat rising college costs; to make college more affordable; to increase quality; and to improve educational outcomes. On June 9, 2014, the President signed a Presidential Memorandum that will allow an additional 5 million borrowers with federal student loans to cap their monthly payments at just 10 percent of their income.
But during the town hall meeting, the feeling in the room was clear: this country needs to do so much more, to ensure that students – regardless of their circumstances – have the information they need to make good choices and the financial support to pay for and complete their education.
The town hall was part of a series of events to encourage conversations and gain insights from the people most directly affected by the rising costs of college. Secretary Duncan and Under Secretary Mitchell were there with one purpose: to hear from students. This was an opportunity to listen to students’ stories, needs, and ideas.
One student panelist, Johnathan, said, “My mom always told me I could go to my dream college. Then when we started to look at the cost, we had to slow down and think again. It’s not something parents want to have to say: ‘Let’s see what we can afford. Let’s pick something lower on your list.”
Johnathan saved on expenses for his family by spending his freshman year at a lower-cost college before transferring to that dream school, Morehouse College in Atlanta.
Wendy, a doctoral student at the University of Pennsylvania and daughter of immigrant parents, shared her mother’s response when she was asked if the family was saving money for Wendy’s college education. She quoted her mother, “Are you kidding me? I’ve been trying to survive in this country. You have to figure it out.”
Student after student took the microphone, eager to share experiences and challenges, and offer ideas about how the federal government, states, and individual colleges and universities could help ease the financial aid process for students and families. Student participants attended institutions coast-to-coast—from Rutgers, the State University of New Jersey, to the University of California at Berkeley.
Several students recommended community college as a strong option for securing the first two years of a 4-year degree at a reasonable cost. One explained, “I feel like there is a stigma about promoting community colleges; [but] I have been able to stay debt free until my senior year.” Still many others raised their hands when asked if they were working their way through school. Several students described the challenge of juggling studies and the need to keep their grades high with the demand to work, in order to keep their loan balances down. Others spoke about the realities of being first-generation Americans, with parents who value a college education, but who encounter cultural taboos about borrowing money to pay for it. Still others spoke about having parents who attended college abroad and were unsure about helping their kids navigate the U.S. higher education system.
The consistent message at the town hall was that with better information, students and families can make informed decisions about higher education, manage their loans and finances wisely, and not have to defer their dreams.
“I want to be clear,” Under Secretary Mitchell told the room of promising young people, “the balance has shifted in ways that are not fair to students and families. We need to be guided by righting that balance on the side of students.”
Robert Gomez is the director of higher education outreach at the U.S. Department of Education.
A system of college ratings will help students choose among colleges and encourage institutions to improve. This fall, the Department of Education set out across the country tolisten to everyone who wanted to talk about how we can make college more affordable and a solid investment for families and taxpayers.
In August the President outlined an ambitious agenda to combat rising college costs and improve the value of education so students and the nation can achieve our goals of growth, opportunity and economic strength. He asked the Department of Education to reach out widely as we create a system both to help students and families choose colleges and eventually to reward colleges’ performance on key measures of opportunity and completion that are important to the nation. He also asked us and to honor his “firm principle that [the Administration’s] ratings be carefully designed to increase, not decrease, the opportunities for higher education for students who face economic or other disadvantages.” –August 22, 2013, Buffalo, NY.
Acting Deputy Secretary of Education Jim Shelton gets feedback during an open forum at Louisiana State University.
So we fanned out across the country to listen. First, we gathered national student organizations, because students are at the heart of this effort to improve education and put it within everyone’s reach. In November, we held four Open Forums in the Los Angeles area at California State University- Dominguez Hills, George Mason University in the Washington, D.C., area, the University of Northern Iowa in Cedar Falls, Iowa, and Louisiana State University in Baton Rouge, Louisiana. We also arranged meetings in Chicago, Boston, Richmond, Las Vegas, and Annapolis, MD, before wrapping up the Fall portion of our outreach earlier this week in Davis, CA. We gathered a wide range of perspectives from college leaders, students and faculty from all levels and sectors, and from parents, business people, college counselors, education associations, and policy analysts. In all, we held more than 55 meetings with thousands of participants. We also invited comment from the public, and continue to welcome ideas, at email@example.com.
What have we learned? It was no surprise that people want the option of college for themselves and their families, that choosing among colleges is hard, and that people worry – a lot — about the cost. Many students and groups that advise low-income students about college responded positively to the plan for ratings that would incorporate measures of college access, affordability and outcomes.
In the summer of 2012, the Obama Administration introduced the Financial Aid Shopping Sheet so that families could have a clear, concise way to see the cost of a particular school. The Shopping Sheet provides a standardized award letter allowing students to easily compare financial aid packages and make informed decisions on where to attend college.
An example of the information on the Shopping Sheet
So far, nearly 2,000 institutions have committed to providing the Shopping Sheet to their prospective students. Those institutions represent over 43 percent of, or over 8.1 million, undergraduate students across the United States.
Since institutions started adopting the Shopping Sheet, we’ve received input from students, parents, guidance counselors, and financial aid administrators. The feedback suggests that institutions and students are becoming more familiar with the Shopping Sheet, so the newest edition of the Shopping Sheet includes only modest changes. To improve clarity, ED has identified minor language changes and has added a glossary to better explain financial aid terms. Additionally, data used to populate college outcomes used on the Shopping Sheet (graduation rate, loan default rate, and median borrowing) have also been updated to be one year more current.
Last August, President Obama outlined an ambitious plan to increase value and affordability in postsecondary education. There were a number of commitments he made in his proposal, and, today, the U.S. Department of Education is announcing further action on the President’s initiatives.
President Obama told students and families that helping to ensure their debt is manageable is a priority, and equipping counselors and advisers with the resources they need to help students prepare for higher education and understand college costs is a key component. To meet these goals, the Department has launched a “one-stop shop” for guidance counselors, college advisers, mentors and volunteers to assist students through the process of choosing and financing their higher education.
The Financial Aid Toolkit, available at FinancialAidToolkit.ed.gov, consolidates financial aid resources and content into a searchable online database. That makes it easy for individuals to quickly access the information they need to support students on their path to college, including details on how to apply for financial aid along with presentations, brochures and videos.
By equipping counselors and advisers with financial aid information in an easy-to-use format, we can help to ensure that current and potential students get the assistance they need to successfully navigate the process of planning and paying for a postsecondary education.
Request for input on college ratings
President Obama also directed the Department of Education to develop a ratings system to identify colleges that provide a good value and to increase college affordability information available to students.
This fall, Department officials have been traveling to cities across the country, listening to hundreds of students, parents, college leaders, state officials, education organizations and many others about their ideas on how to best craft a college ratings system that would better inform students and encourage institutions to improve. This week the Department will submit a Request for Information (RFI) to publish in the Federal Register asking experts and researchers to weigh in.
This RFI will complement the ongoing engagement efforts to inform the development a college ratings system that is useful to students and takes into account the diversity of America’s colleges and universities. The Department will continue to encourage the public to share ideas through firstname.lastname@example.org.
Call for new ideas and innovations in higher education
Another major component of President Obama’s plan is to encourage innovation. More Americans are looking for college options that offer a good education at an affordable price. Innovation offers the potential to dramatically reshape and improve postsecondary education in ways that increase value by raising quality and decreasing costs. This is a pivotal moment, and we want to do all that we can to encourage responsible innovations in higher education that build on promising practices and develop an evidence base so that the highest-impact practices can be identified, replicated and eventually brought to scale.
To encourage innovation, the President directed the Department of Education to shine a light on effective, innovative practices and challenged leaders from across the nation to accelerate innovation and build on success. Further, he directed the Administration to encourage these ideas by removing regulatory hurdles, increasing access to federal databases and simplifying pathways to higher education. To do so, the U.S. Department of Education will launch a limited number of “experimental sites” to test new ideas. This authority under Title IV of the Higher Education Act (HEA) allows the Secretary to waive specific Title IV, HEA requirements regarding the federal student financial assistance programs to allow for responsible innovations coupled with evaluations of their effectiveness. Today, we are asking the public, including the higher education community and others with a stake in a more educated workforce and society, to send us ideas for experimental sites.
We invite input from a diverse array of stakeholders on topics to spur responsible innovation that increases college value and affordability. In August, President Obama identified several promising areas where innovative practices could do so. These include:
Enabling students to earn federal student aid based on how much they learn, rather than the amount of time they spend in class, including through competency-based programs that combine traditional credit-hour and direct assessment of student learning.
Enabling high school students to access Pell Grants to take college courses early so they can earn a degree in an accelerated time frame.
Allowing the use of federal student aid to pay for assessments when students seek academic credit for prior learning as part of a program of study.
These are just some of the many areas where innovative experiments could advance our evidence base about approaches to increasing college value and affordability. We look forward to receiving your additional ideas. For more information on how to submit an idea, please review this Federal Register notice or the Department’s Dear Colleague Letter. The deadline for submissions is Jan. 31, 2014.
The U.S. Department of Education seeks to launch experiments that allow innovation to flourish, while also protecting taxpayer resources and building the research base for what works. In all of the Department’s efforts to encourage innovation and enable colleges and universities to increase quality while reducing costs, we value the input and partnerships with the postsecondary education communities and stakeholders so ultimately, millions of Americans can access a high-quality higher education
Martha Kanter is the U.S. Under Secretary of Education and David Soo is the Senior Policy Adviser, Office of the Under Secretary
Making college more affordable for American families has continued to be a key priority for the Obama Administration, and in August, President Obama proposed a comprehensive plan to address rising college costs and increase college affordability and value. Since his announcement, Department and Administration officials have traveled the country and met with a variety of higher education leaders to hear their thoughts about the three components of President Obama’s plan: paying colleges and students for performance, promoting innovations that cut costs and improve quality, and helping students manage their debt.
President Barack Obama delivers remarks at the University at Buffalo, the State University of New York, during the college affordability bus tour in Buffalo, N.Y., Aug. 22, 2013. (Official White House Photo by Pete Souza)
As part of the proposal to pay college and students for performance, the Department is developing a college ratings system that will better inform families about college value and affordability and encourage institutions to improve, while ensuring that disadvantaged students are served well. Last week, we were excited to announce the first of four opportunities for the general public to interact with Department officials, as well as the broader education community, and share their ideas about how to develop the ratings and address the key themes of college access, affordability and outcomes.
Today, Secretary Duncan announced three additional open forums, in addition to other outreach efforts and events:
California State University, Dominguez Hills in Carson, Calif., on Nov. 6
George Mason University in Fairfax, Va., on Nov. 13
University of Northern Iowa in Cedar Falls, Iowa, on Nov. 15
Louisiana State University in Baton Rouge, La., on Nov. 21
Over the coming months, we plan to engage as many stakeholder groups and individuals as possible to help us develop college ratings that are useful to students and take into account the diversity of America’s colleges and universities. As part of our outreach announcement today, we are also unveiling a new College Affordability and Completion website that will host updated information, including details on timing and registration for the open forums, as well as new outreach events.
The public forums will build on the Department’s outreach activities already underway and will coincide with the Department’s upcoming Request for Information (RFI) to ask data experts and researchers to weigh in on methods for creating college ratings. Since the President’s announcement, officials have met in Los Angeles, Boston, Chicago, and Washington, D.C, with groups including the American Association of State Colleges and Universities, the Historically Black Colleges and University Presidents’ Board of Advisors, the American Council on Education, student leadership associations, independent college groups in Massachusetts and California, presidents from Hispanic-Serving Institutions – and over the next few weeks will meet with community college and business leaders, parents, students, faculty, and more.
We want feedback from students and parents, state officials, college presidents from a variety of institutions, higher education faculty and administrators, businesses and industry leaders, researchers, data experts, higher education associations, innovators, philanthropies, policy leaders and others. If you can’t join us for an open forum, please submit your ideas by sending an e-mail to email@example.com or by mail to the U.S. Department of Education headquarters in D.C. at the following address:
President Obama discusses his plan to make college more affordable during a speech at Henninger High School, in Syracuse, N.Y. Official White House photo.
We know a college degree is the best investment students can make in their future. But despite historic investments and reforms, attending college has never been more expensive. Too many young adults are burdened with debt as they seek to launch a career, start a family, buy a home or save for retirement – and too many students are afraid to pursue higher education because they think it’s too expensive.
The federal government provides over $150 billion each year to support students as they pursue postsecondary education – from public and private universities to community colleges to technical schools and online programs. Although choosing a college is one of the most important decisions that students face, clear and useful information about the cost and quality of different colleges is often hard to find.
There is no lack of sunshine in Arizona, and Secretary Arne Duncan, joined by U.S. Secretary of Transportation Anthony Foxx discovered this first hand early Wednesday morning at the Tucson Unified School District Bus Depot. The early-morning visit kicked off day three of Secretary Duncan’s Strong Start, Bright Future, back-to-school bus tour.
After thanking Tucson bus drivers and mechanics for their hard work, Foxx and Duncan boarded a school bus and rode a full route, picking up students along the way to Dodge Traditional Magnet School. Duncan sat by sixth-grader Simone Ufondu, who shared with the secretary her goals—to become the President of the United States—and what she likes and dislikes about school.
At Dodge, Foxx and Duncan joined students in a service project making “kindness coins.” Students hand out the coins when they see someone perform a random act of kindness. On the playground Duncan joined a pick-up game to shoot some hoops.
The next stop on the tour found Duncan greeted by cheerleaders and marching bands as he arrived at Sunnyside High School in Tucson. Sunnyside provides one-to-one computing for every student. The design allows each participating student access to a wireless laptop. Duncan walked through a student technology expo, speaking with students about their projects and how the technology they use is enhancing their educations.
Following the expo, Arne joined hundreds of high school students for an assembly to talk about education technology. Duncan told Sunnyside that “what you’re doing is not just impacting people here, but has national implications.”
The cost of college is on so many families’ minds, and President Obama brought the affordability of higher education to the forefront in August when he outlined an ambitious plan to demand greater value from colleges and universities and encourage innovations that will help more students access, afford and complete college.
Arizona State University is a natural place to brainstorm ways to make college more affordable. President Michael Crow is a national leader who has led an institution committed to excellence and impact. Few institutions in the country have been more creative, and as a result, ASU is serving more low-income student, raising quality, raising graduation rates, and keeping the cost of college down.
“Our objective is to meet each student where they stand,” Crow said during the town hall in reference to helping students finance their education. “We have a mantra here,” he said, “We will be judged not by whom we exclude, but by whom we include.”
Not far from the ASU campus, Duncan joined local officials and first responders at the Tempe “Healing Field,” where more than 3,000 American flags were displayed representing those who lost their lives due to the tragic attacks on September 11, 2001.
Duncan led the audience in the pledge of allegiance and participated in a candlelight vigil—a fitting close to a day of remembrance across the country.
Day four of the tour took the bus to Phoenix, Scottsdale and Yuma. Check back for a recap.
Let’s face it. College tuition can be expensive. If you think about it in real terms, the annual cost of attending some colleges can equate to purchasing a new car each year. It seems absurd, right? Like many others, you might be wondering “How am I ever going to pay for college” and “Is there anything that I can do to lower my costs?” As a college graduate, current graduate student, and high school teacher, I’ve learned a few tricks on how to save on college:
Consider attending a community college first and transferring after two years. Some states, such as Virginia and California, offer guaranteed admissions to certain four-year institution of higher education for students who complete two years at a community college. You can get your prerequisite classes out of the way and save yourself quite a lot of money in the process. Additionally, SAT and ACT scores aren’t required to get into community college – another money-saving perk. Taking a path like this is a great way to prevent you from borrowing more money than needed.
Just because you are awarded a sum of money doesn’t mean that you have to borrow all of it. Look at your finances, your tuition/school costs, and borrow only what you need. If you want to accept less than what you were offered, let your school know ASAP because borrowing more than you need will cost you extra in the long run.
There is a lot of free money out there. That’s right. I said FREE money; so go find it! You can get it in the form of a scholarship – a sum of money awarded to students to help pay for school. Scholarships are different than loans in that they do not need to be paid back; they are completely free. So, look into applying for scholarships before borrowing a loan. There are thousands of scholarships out there. Scholarships come in all forms – large, small, national, local, etc. On top of that, there are scholarships catered for people of certain ethnicities, locations, majors, religions, skills, along with many other classifications. Think of any topic, and there is probably a scholarship for it – the best homemade duct tape prom outfit, a scholarship for being tall, and a candy technology scholarship. So, my advice is: look into applying for scholarships before borrowing money. Check out College Board’s Scholarship Search to find scholarships that fit your individual characteristics.
In order to reduce the amount of money that you need to borrow, consider getting a job while you attend school. You might even be able to find a part-time job somewhere – perhaps the school library or IT help desk – that allows you to study while you work. Additionally, there are federal and statewide work study programs that can help you earn money to help pay for college, reducing the amount you need to borrow.
When borrowing loans, choose federal student loans over private student loans. If you receive a federal loan, it will have a fixed interest rate , whereas private loans may fluctuate. Moreover, federal loans offer many options for repayment, forbearance, and deferment. Learn more about the differences between federal and private loans.
It’s always a nice feeling to save money. So, make sure to explore all of the money-saving options available to you, and you might be able to alleviate some of your college expenses. If you have any other questions or concerns about saving on college, visit StudentAid.gov.
Kelly Jubic is a digital engagement intern at Federal Student Aid.
President Obama named education as one of the cornerstones of middle-class security in a speech today at Knox College in Galesburg, Illinois.
The President laid out a vision for what our country needs to do to rebuild that foundation – including in education. “The days when the wages for a worker with a high-school degree could keep pace with the earnings of someone who got some higher education are over,” he said.
President Obama said that our country needs to provide an education “that prepares our children and our workers for the global competition that they’re going to face.”
And if you think education is expensive, wait until you see how much ignorance costs in the 21st century. If we don’t make this investment, we’re going to put our kids, our workers, and our country at a competitive disadvantage for decades. So we have to begin in the earliest years.
I’m going to take action in the education area to spur innovation that doesn’t require Congress. Today, for example, as we speak, federal agencies are moving on my plan to connect 99 percent of America’s students to high-speed Internet over the next five years. We’re making that happen right now. We’ve already begun meeting with business leaders and tech entrepreneurs and innovative educators to identify the best ideas for redesigning our high schools so that they teach the skills required for a high-tech economy.