1. Ignore Free Money Come-Ons. Various hucksters purport to offer an inside angle on “free money for college” or “unclaimed financial aid.” Never pay for information that is available free. Ninety-five percent of money for college, including the vast majority of government aid, comes from the institution where the student attends.
2. Understand the Menu of Costs. College can cost $5,000 or $50,000 per year, depending on which type of school a student chooses. The options range from expensive private colleges to cheaper in-state public institutions and community colleges. The best way to control college costs is to include some affordable options on the student’s short list.
4. Apply to Competing Institutions. Needy applicants to private colleges get leverage when they receive financial aid offers from competing colleges. If the offer from First Choice U. is less than one from a competitor, families can use the better offer to see if First Choice U. will match it.
5. Read the Fine Print. The total amount of a financial aid package is less important than the components of the package. Some consist mainly of grants, which are free money. Others are chock full of loans, which must be re-paid. Some packages have good loans, with interest paid by the government while the student is in school. Others have market rate loans with payments that begin immediately.