2012 NYSFAAA Region VII High School Guidance Counselor Workshop

1. 2012 NYSFAAA Region VIIHigh School Guidance Counselor Workshop Award Letters and the Shopping Sheet Presented by: Debra Evans Senior Associate Director Student Financial Services Adelphi University

2. Financial Aid Award Letters: The Good, the Bad, and the Ugly Garbage in, garbage out. Award letters are only as good as the information they contain. What information should you see on a financial aid award letter that will help a student determine affordability?

3. Right now . . . There are no requirements for what should be included in an award letter. Each school determines their own content. Some schools provide more information than others. All correspondence must be carefully reviewed and evaluated before any decisions are made.

4. If it walks like a duck . . . Not all letters are Financial Aid Award letters. Some are scholarship announcement letters and do not contain other vital information necessary to determine affordability.

5. The Basics Most Financial Aid Award Letters contain information about the Financial Aid AWARDS: - Scholarships - Grants - Federal Work Study - Student Loans - Parent Loans OK – that’s good, but what else do we need?

6. Does an Award Letter need more info? How about cost? - Tuition and university fees - Room and board for dorm - Books - Transportation - Personal Expenses Is the process Active or Passive? Does the letter spell out parameters of awards, and the terms and conditions of renewal?

7. What does this do for us? If the Financial Aid Award Letter contains this information, the family can determine the costs that apply to the student based on level of enrollment and housing choice: Tuition and fees ? (everyone pays those) Will he be a dorm student? What will it cost? Will she be commuting? What is the average cost of books? What does this information do for the student?

8. Do the Math . . . Cost - Available aid = out-of-pocket expense

9. Is it affordable ? School ASchool BSchool C Cost A Cost B Cost C - avail. aid - avail. aid - avail. Aid Cost A Cost B Cost C These numbers may be different – perhaps greatly different from one another.

10. DECISION TIME This is where the family must decide what is most affordable for them. They must decide how they will pay for any remaining balance – do they have savings? Is there sufficient current income? future income? Will they be able to borrow loans? If they borrow loans, how much can they afford to repay? They must determine if they have sufficient resources available to them to make the four-year commitment to a given school.

11. What is on the horizon? • Senator Franken (D- MN) has proposed the “ Understanding the True Cost of College Act.” • Higher Education Opportunity Act (HEOA), Section 484 • Partnership with Consumer Financial Protection Bureau • Executive Order 13607 – Establishing Principles of Excellence of Educational Institutions serving Service Members, Veterans, Spouses, and Family Members

12. What are these proposals addressing? • Failure of some schools to report Cost of Attendance (COA) • Failure of some schools to provide clarity between different types of aid offered • Misrepresentation of different types of aid • Confusion about actual out-of-pocket costs • Difficulty in comparing multiple offers “KNOW BEFORE YOU OWE”

13. Currently proposed: Federally mandated award letter template: Schools would be required to use a federal template that could include cost of attendance, scholarships & grants, net price after grants, self- help for the student (FWS & loans), Parent Loans (PLUS), graduation rates, median debt for completers, cohort default rates, loan repayment information, graduation rates and contact info for the Financial Aid office.

14. SHOPPING SHEET An innovative and transparent system-wide approach to promote awareness and understanding regarding college choice, college financing options and responsible loan borrowing. The Shopping Sheet will serve as a model format for all financial aid award letters (may be used as a supplement to the school’s financial aid award letter. It is expected to make information and language more uniform and understandable, enabling students and parents to compare offers between schools. * The use of the Shopping Sheet is currently voluntary

15. Financial Aid Shopping Sheet Student Specific Information: Institutional Metrics: Graduation rate under “Student Right-to-Know” Most recent cohort default rate Median debt for completers Loan repayment information Cost of Attendance Elements Grant s and Scholarships Net price After Grants Work Options Loan Options Other Options Including Family Contribution Contact information Custom Message

16. Is this the “Magic Bullet?” Potential problems: - is it too simple? - is there enough information? - will it allow valid comparisons between different types of schools? - does it address differences in how schools define scholarships, grants, & some other types of aid - is there a “standard” explanation of the Expected Family Contribution? EFC is not treated the same way at all schools. - how are revised award letters to be treated?

17. How can students compare award letters? This may be simplified with the Shopping Sheet (remember slide #9): 1) Make sure you know the ACTUAL COST 2) Compare Apples to Apples: Gift Aid – does not have to be repaid (make sure to know the terms & conditions of renewal) Work Aid – will it be pocket money or is it needed to pay the bill? 3) Total loans offered – do you really need them all? Can you make due with less? 4) What are the packaging policies regarding subsequent years?

18. And if the student is still confused? Nothing beats personal contact. If a student is truly interested in a specific school and is still unsure about affordability, the student and/or the family should be encouraged to reach out to the financial aid office at that school to ask for help in making a determination of their out-of-pocket cost over their potential 4-year commitment.