Many families make false assumptions when it comes to their ability to pay for their child’s college education. I can’t tell you how many times I have heard, “There is no way we will qualify for financial aid based on what other parents have told me.” Or, “Of course we'll get money - how else can anyone afford to pay full price?” The reality is you may be surprised either way. Ultimately, however, it is never a good idea to go through the college process uninformed.
When determining your eligibility for need-based financial aid, colleges examine the assets and income of the parents and student to calculate what they think your family can afford. This number is called your Estimated Family Contribution (EFC). While the EFC calculated by the college may differ from what you think, or what you want to pay for your child’s education, it is still important to know what that number is. When formulating your college plan, understanding what the colleges expect you to pay will help you to map out a plan. Maybe you need to look at colleges that are generous with merit money (non-need based financial aid) or colleges that have a lower price tag (and yes, there are options other than your in-state university). Sometimes it means finding colleges that will give an edge to a student who can pay the full price. In any case, knowing your EFC is critical to building a sound college plan.
Know Your EFC