A number of my mentees (some of whom are in the pages of this very blog!) are off to college, which is quite exciting. Go mentees! (Both returning college students and first-timers.) But college application time is gearing up yet again, and for some reason, I often get asked to give advice on college applications, and specifically on how to get financial aid. I’m not sure quite why this is, since I don’t think I look like the sort of person who knows about all the sweet financial aid deals, although I have applied to a lot of colleges (and gotten into a fair number too), so I guess I have some experience there. And when I went to [East Coast College], the tuition for a year was more than the combined net worth of my father and I, plus around three years of income, so obviously I know a bit about financial aid, and how to work it.
And while I love talking to people about how to go to college, I often find myself repeating the same information, year after year. So I’ve decided to write a two-part guide on paying for college, and writing college applications. Now, there are a lot of these kinds of things out there, and this guide comes from personal experience in a more free and happy economic time (read: before Bush had a chance to totally destroy the economy), so some of the information may be dated, but I think it’s pretty solid. More importantly, I hope that it’s helpful, and I encourage people to ask questions in the comments or to email me if they’re shy.
College is pretty expensive. And I think that’s a major barrier to a lot of poor/middle class people, because they think it’s insurmountable. But I’m going to tell you the same thing my father told me when I was applying to college: money is not an obstacle. It might look like one, but if you really want it, you can go to whatever college you want (even if you don’t get in on the first try, which is a matter for the second half of this series). Never let someone tell you that you can’t afford college. Especially if you’re poor, or if you’re the first person in your family to go to college, or you are disabled, or you are a minority. If you’re in one of these groups, you should be able to basically get paid to go to college. (No joke. When I was going to school at [East Coast College], I used to walk up to the billing office with my ludicrously rich friend who paid his tuition by check while I picked up my free money. Free as in not loans money, as in a stipend the college paid me, per semester, just for being poor.)
Now, when I went to school, the government was basically handing out money. That’s not the case anymore, but there are still some ways to work the financial aid system to get as much as you possibly can. And I want everyone who wants to go to college to be able to do it. Money is no excuse for missing out on an education (and lots of parties which, in retrospect, will seem really awful).
My first tip is: start early. If you’re low-income or middle class, you can qualify for fee waivers for things like the SATS and college applications. But once you pay for something, they’re going to keep making you pay for things. So, when you take the ACT/SAT/whatever test, ask for a fee waiver. Fill out the application. Send it back. If they deny it, appeal it. If they deny it again, scrounge up the cash somewhere. If they approve it, hang onto it, because it’s your golden ticket. By qualifying for a fee waiver on the SAT, you pretty much automatically qualify for fee waivers on college applications, which can be over $100 these days for the pricier schools.
If you don’t qualify for an SAT fee waiver, it’s still worth it to take the time to apply for fee waivers for your college applications. Getting fee waivers doesn’t just save you money, it sets you up for getting more financial aid, because once you get a fee waiver, you end up in a little magical pile of “needy students,” and the financial aid department pays attention to you. And let me tell you something: a lot of private schools have a lot of money they need to give away, so you just need to put your hand out. In fact, private schools are often cheaper than public ones, as long as you pick a school with a big endowment. (Which is not to say that you should pick colleges to apply to on the basis of their endowments, it’s just something to be aware of.)
If you want lots of money, you should also plan on doing well in school. While grades are largely bullshit, they are used as a cutoff for tons of money. Get a high GPA, access lots of money, and that’s just the way it works. Get a low GPA, miss out. While you’re at it, rack up some extracurricular activities to beef up your college and scholarship applications. Interview panels love it when you tell them about how you hand-fed orphaned kittens in a storm for three days, and their pocketbooks will fall open like the, uh, gateway to money. Or something.
As you file college applications, take the time to research financial aid at your prospective colleges. Make a list of deadlines for all financial aid materials. Be prepared to fill out applications for financial aid before you have gotten an acceptance, because the earlier you get financial aid materials in, the better-off you will be. Filing deadlines are often alarmingly early, so do not delay!
Here are some of the ways you can get money:
1. College-based financial aid programs. Most colleges offer financial aid in the form of grants to needy students, along with merit-based scholarships. Often, you are automatically entered for these when you apply, but take the time to double-check.
2. The FAFSA. The Free Application for Federal Student Aid is your friend. Fill it out. It makes you eligible for things like Pell Grants, along with government-issued student loans. While you’re at it, check out state programs like the Cal Grant program.
3. College-based scholarship programs. Both private and public schools have scholarships that are open just to their students. Some of them get really obscure. Are you a Greek-Swedish trumpet player? There might be a scholarship for you. If you’re the first person in your family to go to college, you are eligible for all kinds of financial love. Likewise with LGBT/disadvantaged/minority students, because there are people who have been where you are, and they want to help you with lots of their delicious delicious money. Most colleges kindly maintain a list of scholarships open to their students, along with the basic qualifications. Apply for every one you even vaguely qualify for.
4. Community-based scholarships. Most communities offer scholarships from organizations like the Rotary Club, Lions, etc. Your high school guidance counselor probably keeps a list in the office. Apply for everything. A community-based scholarship paid for my plane ticket to [East Coast College]. Without their help, it’s unlikely I would have even made it to college. One advantage of a lot of community scholarships is that they often come in the form of cash under the table, which means that they will not affect your financial aid award.
5. Generic scholarship searches. Google “college scholarships” and you are going to find a HUGE list of sites that maintain lists of scholarships, including some very juicy government ones.
6. Family members. Milk them.
So, you’ve applied to college, been accepted, and you’ve applied for a bunch of financial assistance, and you’re waiting to hear back. The first thing you are probably going to receive is a financial aid award letter from your college.
The award letter should not be mistaken for the 10 Commandments. It is an opening negotiation in what promises to be a long and fruitful relationship. Now, perhaps you will be satisfied with your financial aid award. Maybe they are giving you enough scholarships and grants so that you will not have to take out loans or contribute much. But maybe they aren’t. If you aren’t happy, retaliate. Call the financial aid office, establish a personal connection with someone there, and start appealing. You will be asked to file paperwork. File it. Keep that personal connection going. Make sure to address all correspondence to that person, and get his or her extension so that you can talk to that person every time you call. If you live close enough to the college, go into the office. Putting a human face on your desire for money will soften their attitude considerably. And remember to be very nice to every single person you talk to on the phone or in the office, because you never know who might have authority in a college. Establishing a good relationship with secretarial staff and the registrar will pay off, not just in a financial aid sense, but in a getting through college sense. (More on that later as well.) Also, being nice just makes you a better person, so do it. Because I say so.
As information about additional grants and scholarships comes in, your award letter will be adjusted. Sometimes things go kerflooey in the office, and the letter gets adjusted to some bizarre original baseline. Do not panic. Call “your person” and straighten the situation out. Things will work out, I promise.
If you’ve applied to multiple colleges and gotten multiple letters, don’t be afraid to play them off each other. Especially if you are a high-performing student, those schools want you, and they will fight to get you. Get the schools to up the ante, exactly like greedy used-car salesmen, and you might end up with a very neat little financial aid award, especially once it is supplemented by all those external scholarships you applied for.
Some final words on paying for college:
1. Do not panic if you have to take out student loans. Student loans are harder to get than they used to be, and the interest rate is higher than my deliciously sinful 1.25%, but they are still not the same as other kinds of debt. Lenders tend to be extremely forgiving, with very generous repayment terms, and the interest rate is way lower than that for other kinds of debt. Secured student loans, in which the government pays the interest as long as you are in school, are often available, so if you have to get loans, try to go for those. If you can’t get those, you might want to consider paying off the interest while you are in school so that it doesn’t compound and cause your total loan amount to be really large when you graduate. Plus, student loan interest payments are tax deductible! Also, while an amount like, say, $17,000 might seem like a lot today, it’s not going to be a big deal when you’re paying it off over the course of many years, and, thanks to inflation, it will be even easier to pay off!
If you end up with a lender who is not so friendly, consolidate your student loans with a lender who is. When you do consolidate student loans, be careful. Predatory lending is still out there, so make sure to read the fine print about the terms, and if you aren’t familiar with financial jargon, find someone who is and ask them to look for the loopholes. If a consolidation package sounds too good to be true, it probably is. Your best bet in terms of lenders is usually a federal or state-based agency, like the Vermont Student Assistance Corporation, the company which handles my student loans now that I have finished paying off the hateful William D. Ford Federal Direct Loan Program (which refused to sell my loans to VSAC when I consolidated).
If you’re fortunate, you will get a cool lender like VSAC from the start. If you’re not, shop around, and try to consolidate with a lender who will lock in an interest rate, and set up graduated payments which start small, and get larger. And remember to deduct that interest! The idea is that when you’ve just graduated, you don’t have a lot of money to throw at loans, but once you start making money, you will, so you can set up the bulk of your balance to come due when you’re more prepared to pay it. Small lenders are usually better, because they will give you personalized service, and, again, it’s good to establish a friendly contact you can talk to when you have problems or questions.
How forgiving are student lenders? Extremely. As long as you stay in touch and try in good faith to pay your loans, they will leave you alone. As long as you are in school, they are never going to ask you for money. Most won’t report you to a credit agency for non-payment for at least three months. This is not to say that you shouldn’t pay off your student loans: student lenders are totally comfortable being patient, because student loan debt will not be erased if you declare bankruptcy. I’m just saying that it’s not the kind of debt you need to be worried about, which brings me to my second and final point:
2. Do not take out a credit card. If you really want to build your credit, get a secured credit card linked to a real bank account. Credit cards are going to be thrown at you (yes, even in this economy) when you arrive on campus: ignore them. You really, really, really do not want a credit card. Ok?
Now, go get cracking on the beginnings of those college applications, and start asking for letters of recommendation if you haven’t already. I’ll be talking about the process of applying to college in the near future. (Why financial aid before college? Because I want to convince people that they can afford college before I bother delving into the depths of college applications.)