It’s that time of year when financial aid award packages will be arriving. Financial aid packages may include grants, scholarships or loans, and the award may come from schools, private foundations or the government.
Like many other financial transactions, you may wonder if your financial aid package is negotiable. The answer is “it depends.” Some schools do not negotiate at all, while others follow a strict set of policies when they consider modifications.
Generally, your award letter has instructions for how to appeal your package with the school’s financial aid administrator. A school’s financial aid administrator has the authority to exercise “professional judgment” and make adjustments when there are financial circumstances that set apart your family from others.
If your circumstances have changed since completing the Free Application for Federal Student Aid (FAFSA), such as, a job loss, death of a wage earner, unreimbursed medical bills, or long-term care costs for an elderly relative, it may be beneficial for you to contact the school’s financial aid administrator to see if they can reduce the loan component of your child's aid package and/or increase the scholarship, grant, or work-study component. You may also ask if there are any new scholarships or grants available for your student.
If your child has been accepted to two colleges that are direct competitors, you may be able to ask if your preferred school will match the other school’s financial aid package. This may be a matter of the second school’s receiving more accurate information on your financial situation. You may be able to better explain your financial situation than you did on the FAFSA. However, with no shortage of students, you will not likely see a bidding war for your attendance.
A desperate plea of an inability to pay will likely garner no sympathy no matter how heartfelt. Unfortunately, most families can take on debt to pay for college. The financial aid administrator’s analysis is based on ability to pay—not willingness to pay.
William G. Lako, Jr., CFP®, is a principal at Henssler Financial, and a co-host on Atlanta's longest running, most respected financial talk radio show "Money Talks" airing Sundays at 10 a.m. on Talk 920 AM, WGKA.