Odds of a Full Ride: Parental Reality check

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As college admissions inch closer with the speed of an incoming ballistic missile, parents dream of the full-ride scholarships for their gifted student, whether the gifts be academic, athletic, or both.

I’ve heard it from parent after parent – “I don’t need to save.” Their student’s gifts will pay off, there’ll be large sums of money handed out. After all, they’ve spent a ton of money of travel/club sports, lessons, hotels, food, training, etc. And, if it’s not athletic money, there’ll be academic awards galore…

Mom and Dad…

Get ready…

You’ll soon be shocked back to reality…

And, perhaps, quite a bit of debt.

Based on the 2015-16 National Postsecondary Student Aid study (NPSAS), the most recent data available (to my knowledge), only 0.2% of students received $25,000 or more in scholarships per year.

While $6.1 billion in scholarships were awarded, there were 1.58 million recipients (8.1% of the college student population). The average award per recipient – $3,852.

Guess what?

The odds are NOT in your child’s favor. You can’t afford not to save!

Don’t make the all-to-common mistake of over-estimating eligibility for aid, whether it be need-based or merit-based (academic or athletic). There are over 80,000 valedictorians and salutatorians each year. Couple that with rampant grade inflation and you’ll find a sea of qualified candidates.

A deeper dive into the data shows that:

• 1.5% of students in bachelor’s degree programs got enough scholarships and grants to cover 100% of the cost of attendance.

• 2.7% got enough to cover 90% of the cost of attendance.

• 5.9% got enough to cover 75% of the cost of attendance.

• 18.8% received enough to cover 50% of the cost of attendance.

Still counting on an athletic scholarship for your child?

Only 2.3% of students in 4-year programs received athletic scholarships at an average $11,914 per athlete. Sure, some will get more, some less.

What does that mean?

An athletically-gifted student is not guaranteed a full-ride. In fact, they’re not guaranteed any money. Roughly 4% of high school athletes will participate in a sport at the college level. And, not every athlete that participates has been awarded athletic money.

When it comes to athletic and/or academic scholarships and awards, aim high. But, have Plan B in place in the event the award is much lower than expected and much lower than the amount you need to cover the cost of the education.

We can help you plan accordingly and we are waiting to hear from you.


Early Decision and Financial Aid


While the odds of acceptance greatly improve, the price may be reduced financial aid.

According to a National Association for College Admission Counseling report (2017), schools that offered Early Decision (ED) accepted nearly 60% of 2016 ED applicants. Many of those schools are private colleges.

Under ED, a student commits to their first choice school and agree to enroll if admitted. Once accepted under ED, students must withdraw all other applications.

If admitted ED, you must accept that school’s financial aid award, even if another school made a better offer. And, if you fail to withdraw the other apps, the ED school may withdraw the offer of admission.

So, what do you need to know?

Generally, the ED is binding, unless the aid offered is not enough to make the cost affordable. This is uncommon.

Highly selective school tend to meet 100% of need, though that may include quite a bit in loans. But, if you’re from high-cost areas, based on your Expected Family Contribution, you may not be able to afford a specific school, even with a generous aid package.

ED will negate your ability to compare packages and leverage awards across multiple schools. Furthermore, ED may limit the amount of merit aid available to your student. As most schools utilize merit aid to attract ideal students, if you’ve applied ED, there may be no reason to offer such aid.

Please contact us for assistance with your family’s college planning campaign. We can help your family maximize financial aid eligibility.


Getting Real about College Funding

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Anywhere you look, you can find advice about saving for college.

And, if you’re trying to save for the full sticker price, not only is that advice depressing as hell, it also may be entirely inaccurate for your situation. This – by far – is not the proper strategy.

You’ll see a ton of information about 529s and how wonderful they are – and they can be in the absolute perfect circumstances. The fact most overlooked is that 529s are not savings vehicles; rather, they are investment vehicles. You could end up with less than the amount you actually contributed to the plan. Now, what kind of savings plan is that?!?

So, let’s get real…

• Conventional wisdom may be wholly inappropriate for your particular family situation;
• Actions taken should not favor eligibility for financial aid over the need to save; and,
• If you’re like most parents, you have absolutely no idea what you’re doing when it comes to a college planning campaign!

Where does that leave you?

It leaves you with the following points to consider and, most likely (and, yes, self-serving), with a dire need to engage the services of a professional college planner!

1. Schools expect a family to “pony up” much more than they can truly afford.

Now, who would have figured that one out?!?

The government and most schools base financial aid awards on the Free Application for Federal Student Aid (FAFSA), with which an Expected Family Contribution (EFC) is calculated. While the EFC may depend on a number of factors, the most prevalent factor is family income, closely followed by family assets.

The EFC expects a large chunk of income (22%-47%) to be used for college expenses. Family assets are assessed at just under 6%.

Maximizing financial aid is a horrible excuse for not saving, especially when you can do both at the same time. You just need to know how to do it.

< HINT – engage a professional college planner!!! >

2. Even if you qualify for a boatload of aid, schools may not be able to give it.

Less than 10% of schools meet 100% of financial need, while nearly half meet 60%-80%. Even those that meet your financial need may not meet it in ways you expect, as aid can vary widely from student to student.

3. Guess what? “Financial need met” DOES INCLUDE loans.

Depending on the school, loans (both student and parent) can be a significant part of the package. Even if a school meets your need, you could end up paying more than your EFC might suggest.

Don’t make the mistake of assuming that saving more will reduce financial aid and that you’ll pay more for school. That may not be the case.

< HINT – engage a professional college planner!!! >

4. Academic or athletic scholarships may not be part of the package.

A large number and variety of scholarships exist in the financial aid universe.

Every one of them may help, but most are relatively small.

And most scholarships, both merit and athletic, are NOT full rides. It doesn’t matter how talented your child may be, there will always be someone with equal or more talent.

As the saying goes, “don’t put all your eggs in one basket.” Have a Plan B in place.

5. Rely on realistic numbers, not hypothetical amounts.

< HINT – engage a professional college planner!!! >

We are waiting to hear from you!