Affording your dream college

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Affording your dream college
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Negotiation 101 begins with the financial aid director.

Gail Marksjarvis
Chicago Tribune

April 23, 2006

Who would have thought that one piece of mail could stir so much
emotion?

But that's what happens to families this time of year when the initial
elation over fat college acceptance envelopes morphs into sticker
shock.

In May, students generally need to let colleges know if they will
attend next fall, or pass up offers to favorite institutions and settle for
more affordable options. For many parents, that poses sleepless nights
as they face $20,000 or $40,000 annual costs to make their children's
dreams come true.

But there are still opportunities to make the price tags less
terrifying.

Don't take those college letters at face value. One college may appear
to offer a better financial aid package than another, but you might be
able to change that.

It's time to negotiate for better financial aid.

Financial aid offices expect it, and frequently offer more grants or
scholarships so they don't miss out on students they want.

But just don't call it "negotiation" when you make the call, said
Kalman Chany, a New York financial aid consultant and author of Paying for
College Without Going Broke.

"Use tact and don't reenact the Jerry Maguire scene: 'Show me the
money,' " he said.

The process is not unlike negotiating on a car, but the criteria is
different, and the style less overt. This is, after all, about a loftier
goal -- educating a person. So keep the discussion on that level, but do
your homework first.

To be successful, understand that colleges approach financial aid in
two ways.

There's a formula for allocating financial aid based on family
finances. That has been used by the staff to compute the financial aid it has
offered. Using the Free Application for Federal Student Aid, known as
the FAFSA, and perhaps the CSS Financial Aid Profile forms, they have
calculated what the formula shows you can afford to pay for college.
That's the "expected family contribution," and calls for both parents and
the student to provide a certain amount of income and savings.

The best part of the aid package is the free money -- grants and
scholarships.

While the formula is precise, there is play in the system. Each college
is different, some with more room to negotiate than others. The outcome
of the negotiation will depend on factors such as whether it's a
private or public college, how attractive a child is to that institution, the
challenges the college is facing in filling next fall's class, and the
size of the endowment the institution has to provide grants or
scholarships.

If a child wants to attend a public college, there is usually no room
to negotiate because the formula is rigid and scholarship money limited.
The exception would be if family financial conditions have changed
since the student applied for aid. If a parent has lost a job, or the
family suffered another financial setback, make sure the financial aid
office takes that into consideration.

Also do that with private schools.

"Offer documentation," Chany said. For example, show records that
indicate you have lost overtime pay or had unusual medical expenses.

You may have some luck, he said, if you can show an extraordinary
necessary expense such as a roof repair after a storm.

But private colleges have more flexibility to add grant money.
Consequently, low- and middle-income students often can attend a private school
at a better price than they would pay at a public university.

Here's what to do: Call the financial aid office and ask to speak to
the director. Tell the director that your child wants to attend that
institution, but you are agonizing over the financial impact on your
family. Also mention that your child has a less expensive option. Then ask if
there is anything that can be done to help make the school more
affordable.

Don't say there is less expensive alternative if you don't have one.
You should be prepared to fax another college's offer when negotiating.

You will be in the best position if your child has been accepted and
given an attractive financial aid package from an institution that is
viewed as a close competitor to the college your child wants to attend.
Use the college rankings assembled by U.S. News and World Report to help
spot competitors. At its Web site (www.usnews.com/us
news/edu/college/rankings/rank index-brief.php) you will see that colleges are
categorized by top universities or top liberal arts colleges. Then there are
lower tiers, or less prestigious colleges, ranked by "tier 3" and "tier 4."

If you have a great financial aid package from a tier 3 college, but
the student wants to attend a college ranked high among "top" colleges,
you probably won't have the negotiating strength that you would if you
also had a great offer from another top college.

Your negotiating position may be enhanced depending on where colleges
rank. For example, if you were admitted to Duke University, ranked fifth
best by U.S. News, and liberal arts school Goucher College, ranked No.
94, you might be in a better position to negotiate with Goucher than
Duke. On the other hand, Duke and Northwestern University, both among the
top 15 schools, might compete more aggressively for very attractive
students.

What's attractive to one college may be less so for another. For
example, all colleges compete to land students with the highest SAT or ACT
scores. When they accept students with high scores, it brings the
colleges up in the rankings, and the schools use their rankings to market
themselves to top prospective students.

So some colleges will attempt to lure students with high SAT scores by
offering merit scholarships. Don't expect the scores to mean much at
universities such as Yale or Harvard, where top SAT scores are the norm
and fewer than 11 percent of students who apply are admitted.

But look through the college rankings for colleges that accept half or
75 percent of the students applying, and there will be more opportunity
for a student with high SAT scores to receive an inducement to attend.
Also look at the average SAT or ACT scores for that college. If your
child is on the high end or above, you are in a good position to land
some merit aid.

A student also may be attractive if he or she has a special talent, is
from a particular ethnic or racial group or from a part of the country
that the admissions staff would like to represent in its student body.

If during the application process your student received special
interest by the admissions office, a coach or academic department, contact
that person and tell them about your financial concerns. He or she may be
your advocate with the financial aid office.

"Some parents are afraid to do this because they are afraid the offer
will be withdrawn," Chany said. "But at worst, they will just decline to
provide extra aid."

When trying to evaluate the attractiveness of your child to a college,
realize that it is difficult to guess on the face of it. A small
liberal arts college, for example, could have had few applicants that year
from a student with a specific talent. So, for example, if the college
needs a cello player, the admissions staff might want to make sure such a
student is admitted.

While you might receive a quick response from a college, you also could
be asked to submit a formal written appeal of your financial aid
package.

If you're still negotiating May 1, Chany suggests asking if you can
delay your response to the college's acceptance letter.

But if that doesn't work, take a deep breath and look at the cost of
college through objective eyes to evaluate whether you can truly afford
it or not.

The Chicago Tribune is a Tribune Publishing newspaper. E-mail Gail
MarksJarvis at yourmoney@tribune.com.

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