The fat envelopes have arrived! You've been admitted to several of your chosen schools — congrats! If you've submitted a FAFSA, it won't be too long before you receive additional mail - your award offers. Examine each carefully; a cursory glance at the figures can be misleading.

Your aid packages are designed to bridge the gap between what college costs and what you and your family can afford to contribute. (It doesn't always do that, but that's its intent.) When you review and compare award packages, there are two criteria that you should take into account: (1) how much of your need is being met and (2) how your need is being met. The total size of your package is not a good measure of its value! Sound contradictory? Let's look at a telling example.

Two colleges offer you admission: Jefferson and Roosevelt. Their costs of attendance are respectively $20,000 and $40,000. We'll further say that your estimated family contribution (EFC) is $9,000. Here's the breakdown:

In the above example, your EFC remains constant but your need differs significantly. In the following scenarios, you'll see how different packages drastically affect affordability.

Award Scenario #1

Roosevelt offers a hefty award package - more than double the amount offered by Jefferson. But there's a problem. Roosevelt has not met all of your need. If you decide to enroll in Roosevelt, you will need to pay $9,000 to cover your EFC and another $6,000 in unmet need. Jefferson, on the other hand, has met your entire need.

Let's examine a second example in depth...

Award Scenario #2

In this scenario, both schools have met your entire need. But Jefferson has met your need almost exclusively with loans. Roosevelt, on the other hand, has met your need with a combination of grant, scholarship, work-study and some loans. The loan portion of the award is half the size of Jefferson's loan amount. The more expensive school becomes the more affordable school!

Making a Decision

Let's reiterate. When you review and compare award packages, the two criteria to take account of are: (1) how much of your need is being met and (2) how your need is being met.

These are only the financial considerations. If your dream school's award offer is loan-heavy, should you go to your second choice? If your dream school doesn't cover your entire need, should you borrow even more with a private loan? Only you and your family can answer these questions.

Our advice: Before you accept an award offer and enroll in college, be sure you know what you are committing to and the consequences of your decision.

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