Alice Murphey: Financial Aid Expert

Financial Aid Studying Your Options

March 29, 2011

Financial Aid Studying Your Options

Although classes won’t start until fall, the next big date to mark on your college-career calendar is April 1.

By then, you should have your financial aid offer in hand, so you can use those figures to help you figure out which college is best for you. The biggest factor in your final decision will, of course, be whether you can afford your top choice.

Running the numbers is as easy as Math 101. Read each college award letter, and add up the awards for aid, including grants, scholarships, work-study and loans. Then figure out each school’s costs, adding tuition and fees; housing and food-plan charges; books and supplies; transportation; and spending money.  (If you are looking at an out-of-state school, figure in out-of-state tuition, too, since that amount will be missing from your financial aid offer.)

Subtract the aid from the cost you’ve calculated. That is the magic number that will determine what you will pay.

Now is when it pays to really educate yourself by digging a little deeper. If you’re awarded a scholarship, check how many years it covers. If it’s for several years, make sure you understand the renewal conditions. Many scholarships require maintaining a certain grade point average and full-time enrollment. Others require community service.

Examine the amounts and types of loans you’ve been offered. Apply for the federal loans that you qualify for, before you consider private ones.  The rates on federal loans are lower, and unlike private loans, they may be canceled because of death or disability and carry deferment options. It’s better to have only one type of loan, but at some schools you may find two or three types in your aid package, which can create repayment complications.

Even if there aren’t any loans in your financial aid award, you still may be eligible for them.  CUNY, for example, doesn’t offer federal loans on its award letters, but you still may qualify for them by submitting a separate application. At other colleges, even if a subsidized federal loan is included in your financial aid package, you still might be eligible for an additional unsubsidized one.

Study each loan’s rates and repayment terms. Some loans have a fixed rate. Others reset periodically, so if interest rates rise, they will get more expensive to repay.

To make it easy to compare and contrast offers from various colleges, check out these two online tools: and

But the bottom line is: Don’t be upset if you can’t afford your first-choice college. One student I counseled visited a college he loved and was thrilled to be accepted.  There was only one problem: The college told his mother to take out a loan equal to her annual salary. And that was just for one year! He chose to attend a public college instead and had an incredible, and affordable, four years there and, best of all, no regrets.

Next week, I’ll tell you how to find more money or cut your costs if your financial-aid offer isn’t adequate.

Alice Murphey, CUNY’s director of financial aid management, has been helping students with tuition issues for more than 30 years.