Picking the Best Financial Aid Package

Paying for college—the final frontier. It does not, however, have to be the most dreadful. Once you have already sent your applications and have already been accepted, the hard part is over! The fiscal issues surrounding college, however, can be stressful if you don't know what to look for. Many colleges and universities are very helpful—and generous—when it comes to offering financial aid, but become a wise shopper before you accept just anything. Simply because a package may meet 100 percent of your need doesn't mean it's the best deal.

When looking for the right package, the key is to start looking early. Inquire about the types of financial aid offered by the school(s) you students have applied to. You should be interested in the aid the school can provide beyond federal loans, grants, and work-study jobs. You'll want to know if a school has scholarships and grants of its own. Also, find out how dedicated to meeting your financial needs a school is. For instance, Duke University in North Carolina is committed to meeting 100 percent of the students' financial need. If you find this out in advance, it may help you narrow down your choices in terms of where you'll consider applying for aid.

Another key is to look everywhere else. Thousands of sources of financial aid—Web sites, scholarship books, community organizations—exist. Did you know there is a scholarship for students who are left-handed? If one of your parents works for the United States Postal Service, you may be eligible for a scholarship from one of the unions. Are you interested in studying women's literature at a liberal arts school in the Midwest? Money is out there for you. Consider all of the sources that exist: the Internet, the library, or your counselors are all great places to start.

A final key to fiscal success in college funding is to complete and return the FAFSA as soon after January 1 (the earliest it can be submitted) as possible. You want to know what federal dollars you will be eligible for as soon as possible because this will help you negotiate a good package with the school(s) you are interested in.

Now, let's suppose two schools have offered you financial aid packages that meet 100 percent of your demonstrated need as determined by your Student Aid Report from the FAFSA. The single most important thing you'll want to consider is the amount of debt for which you will be liable. Look at the chart below:

University 1	University 2
$5,000–Federal loans	$5,000–Scholarship (other sources)
$1,200–Work-study	$1,200–Work-study
$2,000–Federal grant	$2,000–Federal grant
$1,300–Scholarships (from school)	$1,300–Scholarships (from school)
$9,500/year with debt	$9,500/year without debt

Both schools will meet your family's financial needs, but University 1 is offering $5,000 in student loans, which must be paid back with interest. Scholarship hunting may well have covered that expense in University 2.

Reducing the amount of debt you will have upon graduation is important. You don't want to burden them with thousands of dollars of debt right out of school. It may not be possible to avoid loans altogether, but you want to hunt for every free dollar you can early on to reduce the debt later.

If a school truly wants you in its freshman class, it will work with you to find funding sources. It's never too early to start looking—a few hours spent hunting for scholarships now can save you lots of cash and anxiety later.