college

The rising costs of college

Your EFC is generally what schools use to create your financial aid package, no matter what the price of the school. If your EFC is $10,000 and you attend a school that costs $8,000, you'll be expected to come up with the money to pay for your education. Attend a school that costs $22,000, however, and your need will be $12,000. Your EFC is only a benchmark, however, and some schools will expect more from you, some less.

EFC is calculated in two ways: One is called Federal Methodology (FM), the second Institutional Methodology (IM). Some schools use only FM while others factor in their IM, especially when looking at nonfederal aid such as a grant from the school itself.

Schools will often offer aid packages that consist of grants, loans and work-study.

Dependent or independent?

Through age 24, a student is considered dependent, and EFC is calculated with the assumption that parents will contribute to the cost-with a few exceptions. Students are considered independent if they're married, in graduate or professional school, have children or other legal dependents who receive at least half of their support from the student, or are a veteran or an orphan.

Don't meet any of those criteria? At the discretion of the financial aid administrator, you may still be considered independent, but you'll have to have very unusual circumstances. After all, what parents wouldn't want their children to be considered "independent" if it could save them thousands of dollars?

Many worry that they won't be able to pay for their children's college educations without getting mired in debt, but the key to avoiding that scenario is planning. If you're willing to put in the time to get to know the myriad education savings plans, grants, scholarships and loans that are available, you will be able to make it work. Paying for college is rarely easy, but the dividends are well worth it.

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