Reviewing award letters

When you get your award letter from your school, make sure you understand what you are expected to pay for your college costs. The letter will instruct you to sign and choose the aid from the proposed financial resources.

If you have never seen an award letter, you won’t have a clue of what it has. Because each award letter varies from college to college, you can expect to find variety of award letters with varying requirements and costs and aid differentials. To help you get an idea of what you can expect in an award letter, here are some items you can find in an award letter from the beginning to the end:

• Introduction – this provides an overview of the aid package
• Information on grants. This is free money to you. You don’t have to pay back this money. Grants are need-based.
• Academic (school) scholarships – similar to grants, this is free money to you. Scholarships are merit–based.
• Private scholarships – any scholarships you are eligible for from private donors.
• Work-study program information – this is the amount you can earn by working. Basically you will trade your time for a pay check.
• Loan amounts – this lists the loan amounts that you (or your parents) can borrow. This money, however, will need to be repaid.
• Total of aid package – this gives you a total of all the aid amounts.
• Cost of attending college – this shows you much it will cost to attend the college
• The difference between college costs and your total aid amount. If this is a positive number, this indicates how much you will need to pay to the college. If this is a negative number, you can expect to receive that amount from the college; you may have to pay back this money in the future.
• Finally there will be a place where you can sign

Follow these tips in evaluating your aid package letter:

• You don’t have to accept all the aid resources listed in your award letter. You can, for example, choose to reject receiving loans if there is no need to do so.
• Accept grants and scholarships
• Accept work-study programs. This is a great way to apply your existing skills, gain new skills and earn money. My work-study grant was very helpful in preparing me for my post-graduate job.
• Accept loans next. If available, accept subsidized loans first because interest on these is paid by the government while you attend college (and some time after you graduate)!
• If you are expecting award letters from multiple colleges, compare them to find what is suitable to your financial situation. Remember to compare apple to apple. As mentioned above, colleges report information in variety of formats on award letters. So if you have two letters from two separate colleges, you are likely to find costs and aid amounts expressed differently, or not at all. For instance, one college may include cost of transportation in your letter, and the other may not that at all. If the award letters solely don’t provide you the information you seek, contact the school for the desired information.
• Remember your aid may change from year-to-year.
• There is a deadline for accepting your aid package. Acting promptly will secure your desired aid choices.
• Bottom-line is don’t borrow money if it is not essential to your education