1
00:00:00,288 --> 00:00:01,588
- [ Voiceover] Why don't
we go ahead and take a look

2
00:00:01,588 --> 00:00:03,027
at an example package, just to see

3
00:00:03,027 --> 00:00:04,409
how all these numbers hang together.

4
00:00:04,409 --> 00:00:05,187
- [Voiceover] Okay.

5
00:00:05,187 --> 00:00:06,047
- [Voiceover] So why
don't you start me off

6
00:00:06,047 --> 00:00:08,910
with the estimated cost of attendance.

7
00:00:08,910 --> 00:00:11,917
- [Voiceover] So let's say
at the first institution

8
00:00:11,917 --> 00:00:13,157
we're looking at, the total cost

9
00:00:13,157 --> 00:00:15,956
of attendance is about 25,000 dollars,

10
00:00:15,956 --> 00:00:18,790
so that might break out to tuition

11
00:00:18,790 --> 00:00:22,156
of 11,000 dollars, room and board

12
00:00:22,156 --> 00:00:26,092
or housing and food costs
of about 10,000 dollars,

13
00:00:26,092 --> 00:00:30,457
an allowance for books,
2,000 dollars a year,

14
00:00:30,457 --> 00:00:35,408
transportation, depending
on where you're coming from

15
00:00:35,408 --> 00:00:37,597
of about 1,000 dollars a year,

16
00:00:37,597 --> 00:00:40,197
and maybe some other expenses

17
00:00:40,197 --> 00:00:42,334
that are unique to that institution

18
00:00:42,334 --> 00:00:46,176
that would add up to the 25,000
dollar cost of attendance.

19
00:00:46,176 --> 00:00:47,989
- [Voiceover] Great, and just to be clear

20
00:00:47,989 --> 00:00:49,512
for the point you mentioned earlier,

21
00:00:49,512 --> 00:00:51,334
you may see on a financial aid letter

22
00:00:51,334 --> 00:00:53,354
just tuition, room, and board included.

23
00:00:53,354 --> 00:00:53,861
- [Voiceover] That's right.

24
00:00:53,861 --> 00:00:55,002
- [Voiceover] And if that's the case,

25
00:00:55,002 --> 00:00:57,163
you want to actually add
in your own book allowance

26
00:00:57,163 --> 00:00:58,627
transportation allowance, other allowance,

27
00:00:58,627 --> 00:01:00,031
because those are
actually going to be costs

28
00:01:00,031 --> 00:01:01,444
that you're going to incur,

29
00:01:01,444 --> 00:01:03,719
and so you want to factor that in.

30
00:01:03,719 --> 00:01:05,577
- [Voiceover] Exactly, the idea is that

31
00:01:05,577 --> 00:01:06,738
with the cost of attendance,

32
00:01:06,738 --> 00:01:09,385
you've got an understanding
of the total cost

33
00:01:09,385 --> 00:01:11,277
of being at that institution,

34
00:01:11,277 --> 00:01:14,226
and your exact cost might
be slightly different

35
00:01:14,226 --> 00:01:15,329
than someone else.

36
00:01:15,329 --> 00:01:16,559
- [Voiceover] Okay, so we've got our cost

37
00:01:16,559 --> 00:01:19,042
of attendance here of 25,000,

38
00:01:19,042 --> 00:01:20,049
you mentioned some different types

39
00:01:20,049 --> 00:01:23,307
of scholarships, why don't
we put in some numbers here

40
00:01:23,307 --> 00:01:25,512
from school, let's say 10,000.

41
00:01:25,512 --> 00:01:27,601
What would be a reasonable amount

42
00:01:27,601 --> 00:01:28,469
from a Pell grant?

43
00:01:28,469 --> 00:01:30,754
Let's say if a family had an income

44
00:01:30,754 --> 00:01:33,302
of around 50,000 dollars,

45
00:01:33,302 --> 00:01:35,600
what would be a typical Pell
grant they might receive?

46
00:01:35,600 --> 00:01:37,365
- [Voiceover] So a family
of that income level,

47
00:01:37,365 --> 00:01:39,525
depending on what else is going on

48
00:01:39,525 --> 00:01:42,635
with the family, family size,

49
00:01:42,635 --> 00:01:44,365
how many family members in college,

50
00:01:44,365 --> 00:01:46,827
let's say that they would qualify

51
00:01:46,827 --> 00:01:48,804
for a thousand dollar Pell grant.

52
00:01:48,804 --> 00:01:50,154
- [Voiceover] Okay, so
we have a thousand dollar

53
00:01:50,154 --> 00:01:52,035
Pell grant, we'll go ahead and say there's

54
00:01:52,035 --> 00:01:54,042
a 3,000 dollar grant from the state,

55
00:01:54,042 --> 00:01:56,051
that this student has obtained,

56
00:01:56,051 --> 00:01:56,930
and then why don't we also go ahead

57
00:01:56,930 --> 00:01:59,930
and also put in 1,000
dollar outside scholarship.

58
00:01:59,930 --> 00:02:01,287
This is a scholarship that is not coming

59
00:02:01,287 --> 00:02:02,936
from the school itself, it probably won't

60
00:02:02,936 --> 00:02:04,632
be included on the financial aid letter

61
00:02:04,632 --> 00:02:06,094
unless you've already told them about it,

62
00:02:06,094 --> 00:02:07,696
but it is something you
want to include here

63
00:02:07,696 --> 00:02:09,495
because these are your own calculations

64
00:02:09,495 --> 00:02:11,154
of what your costs are going to be.

65
00:02:11,154 --> 00:02:12,874
And one sort of side note is

66
00:02:12,874 --> 00:02:14,314
you do actually want to
let the school know about

67
00:02:14,314 --> 00:02:15,671
those outside scholarships,

68
00:02:15,671 --> 00:02:17,854
because it can have an
impact on your financial aid.

69
00:02:17,854 --> 00:02:20,108
They want to understand your
true cost of attendance,

70
00:02:20,108 --> 00:02:21,953
and if you've already
gotten that scholarship,

71
00:02:21,953 --> 00:02:23,823
your cost of attendance is
going to be a little bit lower.

72
00:02:23,823 --> 00:02:24,548
- [Voiceover] That's right.

73
00:02:24,548 --> 00:02:25,629
- [Voiceover] So we put
in that thousand dollars,

74
00:02:25,629 --> 00:02:28,555
that gives us a total scholarship amount

75
00:02:28,555 --> 00:02:31,829
of, looks like 15,000.

76
00:02:31,829 --> 00:02:34,708
So now, remind me again, how
do I get to the net cost here.

77
00:02:34,708 --> 00:02:36,399
- [Voiceover] So the net cost is going

78
00:02:36,399 --> 00:02:38,987
to be the difference
between the 25,000 dollars

79
00:02:38,987 --> 00:02:43,027
of cost of attendance,
minus the 15,000 dollars

80
00:02:43,027 --> 00:02:44,978
of scholarships or free money

81
00:02:44,978 --> 00:02:46,441
that doesn't have to be paid back,

82
00:02:46,441 --> 00:02:48,879
so what this institution's actually going

83
00:02:48,879 --> 00:02:51,503
to cost you is 10,000 dollars.

84
00:02:51,503 --> 00:02:54,588
- [Voiceover] Great, so 10,000
is what I'm responsible for

85
00:02:54,588 --> 00:02:56,733
and that's not one time,
that's over a year.

86
00:02:56,733 --> 00:02:58,033
- [Voiceover] That's
right, that's not saying

87
00:02:58,033 --> 00:03:00,558
that you have to come up with that cash

88
00:03:00,558 --> 00:03:04,058
all up front out of
your pocket right away.

89
00:03:04,058 --> 00:03:07,274
There are options offered
to help you come up

90
00:03:07,274 --> 00:03:09,317
with that 10,000 dollars, but that would

91
00:03:09,317 --> 00:03:11,372
be the annual cost to you.

92
00:03:11,372 --> 00:03:14,605
- [Voiceover] Okay, in this situation,

93
00:03:14,605 --> 00:03:16,974
what would be sort of
reasonable work-study

94
00:03:16,974 --> 00:03:18,966
and loan amounts that
a school could offer?

95
00:03:18,966 --> 00:03:20,964
- [Voiceover] So let's
say a work study amount

96
00:03:20,964 --> 00:03:24,594
of 2,500 dollars, which would allow you

97
00:03:24,594 --> 00:03:27,289
to work less than 10
hours a week, I think,

98
00:03:27,289 --> 00:03:30,811
is a really reasonable expectation,

99
00:03:30,811 --> 00:03:35,590
and then a loan amount
of another 2,500 dollars.

100
00:03:35,590 --> 00:03:39,780
So there's 5,000 dollars of that net cost

101
00:03:39,780 --> 00:03:44,321
that's taken care of between
work-study and student loans.

102
00:03:44,321 --> 00:03:47,212
So that leaves the family, or the parents,

103
00:03:47,212 --> 00:03:50,022
with 5,000 dollars to cover

104
00:03:50,022 --> 00:03:54,017
of that total educational
cost of 25,000 dollars.

105
00:03:54,017 --> 00:03:54,765
- [Voiceover] And is that 5,000 going

106
00:03:54,765 --> 00:03:56,456
to be due right away?

107
00:03:56,456 --> 00:03:58,359
Day one of school, they pay the 5,000?

108
00:03:58,359 --> 00:03:59,424
Or when do actually have to pay --

109
00:03:59,424 --> 00:04:01,429
- [Voiceover] Typically,
no, it's usually paid

110
00:04:01,429 --> 00:04:05,235
if it's a semester
school, it would be half

111
00:04:05,235 --> 00:04:06,874
of it at the start of the year,

112
00:04:06,874 --> 00:04:09,635
half of it halfway
through the academic year.

113
00:04:09,635 --> 00:04:12,411
So it depends on that
school's academic calendar

114
00:04:12,411 --> 00:04:14,675
and their billing cycle.

115
00:04:14,675 --> 00:04:15,902
- [Voiceover] Great, and
the last question I have

116
00:04:15,902 --> 00:04:18,772
for you, is 5,000
dollars for some families

117
00:04:18,772 --> 00:04:20,499
that may be completely doable.

118
00:04:20,499 --> 00:04:23,378
For others, that may be far above

119
00:04:23,378 --> 00:04:25,050
what they can contribute.

120
00:04:25,050 --> 00:04:26,873
- [Voiceover] The very first
thing I would recommend

121
00:04:26,873 --> 00:04:29,288
to a family that's concerned about paying

122
00:04:29,288 --> 00:04:31,633
the expected family contribution

123
00:04:31,633 --> 00:04:33,409
that's showing up on their award letter,

124
00:04:33,409 --> 00:04:36,254
is that they talk to the
financial aid office,

125
00:04:36,254 --> 00:04:38,280
and make sure that the
financial aid office

126
00:04:38,280 --> 00:04:42,135
has taken everything into
account that that family has,

127
00:04:42,135 --> 00:04:44,863
the financial situation
that they're facing.

128
00:04:44,863 --> 00:04:47,126
But after you've had that conversation,

129
00:04:47,126 --> 00:04:51,054
if you're looking at a parent contribution

130
00:04:51,054 --> 00:04:53,040
that you're going to need some help with,

131
00:04:53,040 --> 00:04:55,979
then it's time to start
talking about additional loans.

132
00:04:55,979 --> 00:04:56,731
- [Voiceover] Gotcha, and it looks like

133
00:04:56,731 --> 00:04:58,079
in this situation, you might be able

134
00:04:58,079 --> 00:05:00,875
to bump up the student's
work study a little bit,

135
00:05:00,875 --> 00:05:03,569
or the student could take out
these low interest rate loans,

136
00:05:03,569 --> 00:05:04,486
which might be better options

137
00:05:04,486 --> 00:05:05,671
than the parent taking out loans.

138
00:05:05,671 --> 00:05:07,353
- [Voiceover] As a first year student,

139
00:05:07,353 --> 00:05:09,409
actually, from the Stafford loan program,

140
00:05:09,409 --> 00:05:12,428
a student can borrow up to 5,500 dollars,

141
00:05:12,428 --> 00:05:14,529
so that typically would be
the first thing we would

142
00:05:14,529 --> 00:05:16,014
recommend to a student who is looking

143
00:05:16,014 --> 00:05:18,011
for some additional help.

144
00:05:18,011 --> 00:05:19,264
- [Voiceover] Great.
Is there anything else

145
00:05:19,264 --> 00:05:22,805
that I should be looking
at when I'm understanding

146
00:05:22,805 --> 00:05:25,754
the different components
of a financial aid package?

147
00:05:25,754 --> 00:05:27,636
- [Voiceover] Well, I think it's critical

148
00:05:27,636 --> 00:05:31,976
that you identify the
difference between scholarships

149
00:05:31,976 --> 00:05:35,728
and loans, and work-study
that are being offered.

150
00:05:35,728 --> 00:05:38,989
Unfortunately, it's not
always readily apparent

151
00:05:38,989 --> 00:05:40,696
from the information that you're receiving

152
00:05:40,696 --> 00:05:43,832
from the school, so
make sure you understand

153
00:05:43,832 --> 00:05:48,034
what's a scholarship, what's
a loan that has to be repaid,

154
00:05:48,034 --> 00:05:49,885
and what's work-study.

155
00:05:49,885 --> 00:05:52,021
If you have any questions
about that at all,

156
00:05:52,021 --> 00:05:54,098
go to the financial aid office to ask.

157
00:05:54,098 --> 00:05:55,027
- [Voiceover] Okay, so
students really need

158
00:05:55,027 --> 00:05:57,420
to kind of put this sheet
together for themselves,

159
00:05:57,420 --> 00:05:58,383
it's not necessarily going to be handed

160
00:05:58,383 --> 00:05:59,683
to them on a silver platter.

161
00:05:59,683 --> 00:06:00,519
- [Voiceover] That's right, I think that's

162
00:06:00,519 --> 00:06:02,891
the best thing to do to
make sure you understand

163
00:06:02,891 --> 00:06:05,306
what's going on with your financial aid,

164
00:06:05,306 --> 00:06:07,466
and how much are you signing for

165
00:06:07,466 --> 00:06:08,839
in student loans, for example,

166
00:06:08,839 --> 00:06:10,823
to really understand the bottom line

167
00:06:10,823 --> 00:06:12,889
of what you're getting into.