#StudentAid #CollegeLoans #scholarships #FamilyContribution
When a family applies for federal student aid, the application process spits out an expected family contribution.
When the student chooses a school, the school may tell the family what ITS expected family contribution will be. Often, that number is higher than the federal number – often considerably higher and potentially unaffordable for the average family.
Tara Siegel Bernar tackled this subject in an article for The New York Times. It was also published Nov. 24. 2019, in The Atlanta Journal-Constitution.
“For a long time, there has been this growing chasm between the need-analysis formula and accurately reflecting a student and their family’s ability to pay for college,” the article quotes Justin Draeger, president of the National Association of Student Financial Aid Administrators, which has members at nearly 3,000 schools.
“The gap has grown wider not just because of the exponential rise in college prices, but also because of the Expected Family Contribution (EFC) formula itself,” Siegel Bernar writes.
The EFC formula often assumes families have more income available for college than they actually do, the article quotes financial aid experts. “The reason lies in its basic assumptions: that a family of four, for example, can subsist on less than $30,000, no matter where they live,” Siegel Bernar writes.
There are certainly differences in the cost of living among various areas of the country. The East Coast and West Coast areas are generally expensive to live in, because that’s where where many job and career opportunities lie.
There are also different family circumstances. A family may have an elderly parent living with it, for example.
The point here is that formulaic calculations don’t always add up for everyone. Also, college is expensive. When a family sends a student to college, and may have trouble affording to pay for it, there had better be lots of thought: what will the student study, will that study pay off in terms of a lucrative career, is it worth incurring debt to make it happen etc.
First, college is not for everyone. Second, not every field of study will necessarily lead to a good-paying job. If a job is hard to find at the end, and the student is saddled with a big debt, it may be a long time before he or she gets on his or her feet as an adult.
Parents, meanwhile, need to have a nest egg for retirement. Sacrificing one’s retirement to send a child to college may not always be the best option for families.
Finally, there are many programs out there that allow a person, regardless of background or education, to earn a potentially lucrative income, if he or she puts his or her mind to it and follows a system. To learn about one of the best such programs, message me.
In sum, the cost of college is likely to be more than you originally thought it would. As with health care, colleges have to find economies, efficiencies etc., to make higher education more affordable.
Students have to think about not only which school to attend, but also what they will major in. Will that major likely produce a payoff that will make it worth it to mortgage one’s self, or family, for many years?
Certainly, no education is wasted. But there is a difference between payoff and waste. Think long and hard, and get good family and educational input, before deciding where to go to college, what to study or even whether to go to college.
Peter