Reading an aid offer line by line

The cost lines at the top

Most offers open with the cost of attendance, the college's estimate of a full year of study. Many colleges use the standard College Financing Plan, which lists the same lines in the same order. Other colleges design their own letter, and the labels can differ even when the meaning is the same.

Direct costs are the charges the college bills you for, such as tuition, required fees and campus housing. Indirect costs are estimates for things you pay to someone else, such as rent off campus, food, transportation and personal spending. Your real indirect costs may be higher or lower than the estimate, depending on where and how you live.

Gift aid and the source behind each line

Grants and scholarships are gift aid, money you do not pay back. Each line usually names its source, and the source decides how the award renews. A Pell Grant or FSEOG comes from the federal government, a state grant from your state's higher education agency, and an institutional grant from the college's own budget.

The source matters because each one sets its own conditions. Federal grants depend on a new FAFSA each year and on satisfactory academic progress. A state grant may require you to keep living in the state and to file by the state's deadline, while a college merit award may require a set grade average and full-time enrollment.

Some lines are estimates rather than final awards. A state grant listed before the state confirms its budget, or an outside scholarship you reported early, can change before the term begins. Ask the aid office to mark which awards are confirmed and which are expected.

Lines you earn or borrow

Federal Work-Study appears as a sum, but that figure is a limit on what you can earn rather than a credit on your bill. You find a job through the school's program, work the hours and receive a paycheck. If you count on it for tuition, plan for the timing, since paychecks arrive across the term.

Loans are borrowed money, and a clear offer lists them apart from gift aid. Some letters add loans into a single total of aid, which can make the offer look more generous than its grants and scholarships. Separate the borrowed lines from the gift lines before you draw any conclusion.

Service awards and employer tuition help may be missing if the college has not heard about them yet. An ROTC scholarship, an AmeriCorps education award or tuition help from an employer all count toward your aid, and the aid office needs to know about each one.

Net price and what is still unpaid

Net price is the cost of attendance minus gift aid. It is the figure to compare across colleges, because it leaves out money you would have to earn or borrow. Work it out yourself if the letter does not show it, using only grants and scholarships.

The amount the college will bill is a separate figure. Subtract gift aid from direct costs only, and you see roughly what each term's bill will ask for. Indirect costs still need a plan, even though the college never sends a bill for them.

Questions to send the aid office

Write down every line you cannot explain and send the list in one message. Ask which awards renew on their own, which depend on grades or credit load, and which need a new application. Ask for the date by which you must accept or decline each award.

Questions about a state grant can also go to the state agency, and questions about a private scholarship go to the group that awards it. The aid office decides the federal and college lines, so start there and work outward.