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I've been accepted at several colleges. Now what?
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Compare apples to apples
Now that you know the real cost of college, get ready to compare aid offers. Financial aid packages consist of three basic types of awards -- awards you'll have to pay back (including subsidized and unsubsidized loans), gift aid you won't have to pay back (including federal and private, need- and merit-based scholarships and grants), and awards you'll have to work for, such as work-study positions.

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Marie Mons, director of student financial planning and services for the Georgia Institute of Technology in Atlanta, urges students to consider the type of aid offered and whether the award is renewable rather than the size of the financial aid package.

"When folks open up their award letters, their eyes tend to go first to the bottom line, but it's important to understand each of the components," she says. "A $15,000 loan from one school actually may be better than a $2,000 scholarship from another school."

By carefully examining what type of aid is offered, you'll be able to see that a $10,000 scholarship from an expensive school might look good in print, but could leave you significantly more in debt than a $5,000 scholarship from a cheaper college. Likewise, a $6,000 one-time grant from one school might boost your bank account during your freshman year, but might not help you pay for all four years in the same way that a $20,000 loan from another school would.

To make sure you're comparing apples to apples, Mons encourages students to look at their aid awards in the context of the cost of a four-year education at that school. That means calculating each school's total, four-year cost of attendance, including tuition inflation, then subtracting the amount of gift aid offered over the four-year period. Once you know what you'll be expected to pay for each school, you'll be able to compare loan and work-study offers and see who's really offering you the best deal. If you need some number-crunching assistance, Collegeanswer.com offers a free financial aid award analyzer that can help you understand how your schools of choice stack up.

Plan for the worst (and the best)
Erin Korsvall, spokeswoman for Sallie Mae, recommends that prospective students ask the school's financial aid officer about how the aid package will be impacted by an unexpected change in cash flow before officially accepting an offer. Since all need-based aid is directly tied to your family's financial circumstances, clarifying whether your school offers emergency financial aid in the event of a cash crisis can save you time and stress down the road.

Deffenbaugh says that it's also useful to know how your aid package can be impacted in case of an unexpected cash bonus. Because federal need-based aid is directly impacted by private grants or scholarships won, any additional aid you might win during your sophomore, junior or senior years could subtract from your annual check from Uncle Sam. While the school has no control over the fact that your aid award will be impacted by extra scholarships and grants, Deffenbaugh reports that financial aid officers do have some control over what type of aid is affected, so make sure you ask before you enroll.

"If the student's demonstrated financial need is being met and then they win an additional scholarship, their aid package will be affected," she says. "Most schools will use it to affect need-based loans rather than need-based grants so that the student benefits, but that's a question for the financial aid officer."

To avoid any unpleasant financial aid surprises, it's best to read the fine print, ask tons of questions and keep life after college in mind when sizing up your offers.

Bankrate.com's corrections policy -- Posted: April 26, 2006
 
 
More stories by Christina Couch
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