This is part 3 of a 3-part series on College + Money, and you can learn more about this topic as well as parts 1 and 2 referenced below on the Tom Talks College podcast.
How much will we really pay?
In the first part of this series, “College Costs Simplified: The 15/35/45 Rule” (episode 16) highlighted the three basic parts of college costs and an easy to remember 15/35/45 rule to give you a ballpark of the most important part: tuition and fees. Part 2 “Merit Aid: Your Teen’s Best Part-Time Job” (episode 17) went beyond sticker price to find merit aid and show you that many colleges offer generous discounts for good grades and test scores. Net Price Calculators are one more tool to understand college costs in a more personalized way.
What is a Net Price Calculator (NPC)? Where do I find it?
Net Price Calculator = financial tool found on college websites that’s designed to provide an estimate of your costs using inputs such as EFC or income and assets, family size, number of children in college, and academic data like GPA and test scores
Your Expected Family Contribution (EFC) is an index number used to determine your eligibility for federal student financial aid. This number results from the information you provide in your Free Application for Federal Student Aid (FAFSA®) form. Your EFC is calculated according to a formula established by law and considers your family’s taxed and untaxed income, assets, and benefits. Schools use the EFC to determine your federal aid eligibility and financial aid award. Your EFC is not the amount of money your family will have to pay for college, nor is it the amount of federal student aid you will receive. It is a number used by your school to calculate how much financial aid you are eligible to receive.
That last part is highlighted because some families assume that their EFC is what they’ll pay, but it’s not. It’s just one part of the financial aid process. If you’d like to calculate an estimate of your EFC, use the Federal Student Aid Estimator.
How do colleges use my EFC?
Here’s a very simplified version of the financial aid formula.
Cost of Attendance (COA) – EFC = need
Cost of Attendance is a sample budget for a first-time full-time student, and let’s use UW-Madison’s COA for in-state residents as a reference.
Tuition and fees$11,216
Room and board $13,500 (remember that these top two parts are “direct costs”)
Miscellaneous$4200 (“indirect costs” such as books, travel, etc.)
Total$28,916
So if you had an EFC of $28,916 or more, UW-Madison’s financial aid office would determine that your “need” was zero. They’re not saying you have all that in the bank or in a 529; they’re just telling you what your need is according to their formula.
If your EFC was $20,000, your need would be $8916, but that doesn’t mean you’d get an $8916 discount, scholarship or grant. You’d probably qualify for federal student loans and that would make up the bulk of your financial aid package.
This is where EFC can be misleading. It’s just one number that goes into the process, and colleges are under no legal obligation to “meet need”.
Now let’s turn our attention back to NPC’s and see some examples that range from very helpful to almost worthless.
We love you, Athens, but your NPC stinks
Colleges often use a third-party plugin for their NPC, which is why you’ll see so many that look similar. I chose the University of Georgia as an example because it’s a personal favorite even though they do not post a “merit matrix” and offer limited scholarships to out-of-state students. As soon as I saw the site, I knew the NPC would ask for very little and deliver even less. Take two minutes to work through the University of Georgia’s net price calculator, and you’ll notice they didn’t ask for any information that would lead to academic merit aid, and they asked for a range of household income instead of your EFC. This really didn’t help us get any closer to a personalized estimate other than “we probably won’t get much if anything” – and they’re using numbers from 2020-21 to boot! C’mon, Bulldogs. You can do better.
Ohio Wesleyan, you are my new best friend
After the frustration of Georgia’s NPC, I turned to one I remember as excellent: Ohio Wesleyan. After a few easy questions about my student, I entered a GPA and was immediately shown a potential merit scholarship of $28,000 per year. That’s a discount of 53%, and I’m now well below the 45 for private colleges and universities in the 15/35/45 rule.
After what I can only describe as a smiling page of their NPC that says, “Pretty cool, huh?” you’re invited to enter financial data to check for possible need-based aid.
Every NPC requires you to check a box agreeing that this is just an estimate, and even the best can never be more than an estimate – but can you see how valuable a quality NPC can be in your family’s search for accessible and affordable best-fit colleges?
MyinTuition is the (potential) game changer
It’s incredibly hard to talk about college costs, NPC’s, admissions data or almost anything college-related without veering into too many rabbit trails of exceptions and case-by-case situations. So I’ll just say a quick, “Hey, can I share one more thing before you go?” that will put smiles on some of your faces and cause others to throw up in their mouths.
Roughly 75 of the most selective schools use an NPC called MyinTuition, sometimes in addition to a more standard version. One of the more popular “Ivy Plus” colleges is Vanderbilt, where the COA is just north of $84,000. Gulp. MyinTuition prides itself on ease-of-use and minimal questions, so let’s pretend we have one more boy in the house who is a junior and really loves him some Nashville. I’m plugging in our numbers now and will time myself and record my response as accurately as possible. (I’ve done this for others on the list but not the Commodores.)
It took just under two minutes, and I shook my head with a pleased “hmmm” when I saw these numbers.
The Kleese’s are kicking in $26,800, unnamed son #3 will work at the library or set up chemistry labs as his dear mother did to earn $2300 – and Vanderbilt picks up the tab for rest. MyinTuition always gives you a best estimate as well as a low and high, and when I click on those I just see our green part moving with the blue part adjusting as well.
This is great, right? Our EFC this year was around $40,000, so if you jump back to UW-Madison, we’re likely only qualifying for student loans but no scholarships or grants. And Vanderbilt is less than the $28,916 full price tag at Madison.
Now all we need is to adopt a super smart kid who can get into Vanderbilt, and then I’m the dad in the dad-polo enjoying an SEC game.
Your results may vary
Some of you are in different financial situations than we are, and I’ve sent MyinTuition out to enough parents and had enough “are you crazy?” responses to know that the green piece of their puzzle is sometimes overwhelming. But that’s still a good thing – because knowing or even expecting to pay whatever your costs may be is so much better than telling your student to “not worry about price and if you get it we’ll figure it out”. Will you? Should you even say that unless you have some basic information like this?
What now? Run some numbers!
Schedule one hour this weekend in a quiet room to calculate your EFC, and then use that number in NPC’s at colleges that interest you or your student. Seriously – one hour will teach you so much you didn’t know, and even if you don’t like what the NPC’s show you…at least you’ll know.
Call me at (608) 553-3445 and say, “Hey, I read the blog and listened to the podcast and did that one hour thing you suggested, and I just wanted to talk a little more about this.” I’d love to take that call and help you understand not just what I said and showed you, but listen to what you’re seeing and thinking, and then answer as many questions as I can on a phone call.
Here’s how I got the 1.3% number, because it’s not percentage-based.
UW-Madison COA of $28,916 x four years = $115,664
Our standard college search package is $1500. $1500/$115,664 = .0129685987, or 1.3%
Up next
Here’s an email from a parent: “Excellent merit aid podcast…I think you should do a podcast directed to the students about how to not stress out about this entire process. Maybe one for type A moms.”
This is part 2 of a 3-part series on College + Money, and you can learn more about this topic and also hear last week’s “College Costs Simplified” on the Tom Talks College podcast.
Merit aid may be the best thing you’ve never heard of when it comes to college admissions, and what follows is a quick introduction to what could be your teen’s best part-time job…and to the gift that keeps giving. Before we dig into the details, let me state this up front and as clearly as I can.
Merit aid is the best tool you have to reduce the cost of college.
Read that again, and if it helps, imagine me as Curly from “City Slickers” holding up one finger to you, the Billy Crystal character, but not dodging your question about what the one thing is – because it’s merit aid. Plain and simple.
What exactly is merit aid?
Merit aid is a general term for scholarships you earn that come directly from colleges. You’ll sometimes see these listed as freshman scholarships, and they are awarded for talents such as athletics, fine arts, or academic achievement. Just as important is what they are NOT. Merit scholarships are NOT:
Loans;
Need-based financial aid;
Distributed by the federal government.
The bulk of merit aid is “automatic”, in that it’s awarded by hitting key benchmarks in cumulative GPA and ACT/SAT scores. (By comparison, “competitive” scholarships are those to which you apply after acceptance and are usually awarded to only a handful of students. If you see a long list of scholarships with the donors’ names attached, those are competitive.)
For academic merit aid, admissions offices pull GPA and ACT/SAT numbers, if applicable, straight from your student’s application, and many colleges openly display what I call a “merit matrix” – a simple chart with rows and columns for grades, test scores and money. The first example I saw was on Miami University’s website, and I almost fell off my chair.
The gift that keeps giving
Unlike scholarships that are handed out at high school awards nights, merit aid is awarded all four years assuming the student maintains satisfactory grades.
You, the hard-working, bright high school student, spend three years building up that nice GPA and knocking out some impressive standardized test scores – and you’ll be handsomely rewarded throughout four years of college.
Where and how to find it
In general, you’ll find merit aid in two types of colleges:
Public universities in states hoping to attract bright young minds and boost not only the academic stats of an incoming class, but their ranking in US News and World Report.
Private colleges and universities that aren’t members of the Ivy League or among the most highly selective.
The first category is a little easier to find and often comes with a merit matrix. The second category is less evident and less likely to be upfront about automatic merit aid, but it’s still a prime source of merit aid.
There is no central database or comprehensive list of colleges that award merit aid, so your best bet is to Google [name of college] and then a combination of these terms: merit aid, merit scholarships, freshman scholarships.
I often plug out-of-state into my search, because I’m usually searching for options beyond a student’s home state. Be sure to compare in-state vs. out-of-state merit when you find it, because those numbers can vary greatly.
Notice there are two levers: cumulative GPA and ACT/SAT. Alabama uses two GPA ranges (3.50+, 3.00-3.49) which is fairly common. Sometimes you’ll see one level stacked on top of the next, i.e. 3.50 + 26 ACT, 3.75 + 28 ACT, 4.00 + 30 ACT. And in full transparency from a business which was built on test prep, some colleges shifted to a GPA-only approach in 2020 so you really do need to look at each college individually.
Why are they doing this? Is there a catch?
Way before NIL, colleges aggressively recruited 5-star athletes to boost on-field success – and some have taken a similar approach to academics. A seminal article on the merit aid movement was published in the New York Times on November 3rd, 2016: How the University of Alabama Became a National Player.
Rule of thumb for merit aid
The harder it is to get into a college, the less likely you are to get merit aid. Their gift to you is the fat envelope. The Ivy League doesn’t award merit because they don’t have to, and neither do the hyper-popular-and-competitive public flagships like UNC-Chapel Hill. In fairness, they do offer some but I’ll let you read this and then decide what your chances are.
UNC is proud to offer Academic Scholarships to a small number of outstanding students each year. All students who are admitted to UNC are automatically considered for these scholarships; no additional application materials are necessary.
Unfortunately you’ll quickly run into colleges which don’t offer merit aid, or are much less transparent, using language to the effect of “we provide scholarships for deserving students in recognition of their achievements.” “ (On a future podcast and blog I’ll coach you on how to use Net Price Calculators as a possible work-around.)
Great values beyond flagships
Medium-sized private universities that accept over half of applicants are a great source of merit aid. Marquette, for example, almost always knocks off a quick $16,000-$20,000 in the acceptance letter. Regional comprehensive universities similar to UW-La Crosse or Winona State also offer tremendous value. The snowboarder or mountain bike enthusiast who ventures to Colorado Mesa University in Grand Junction packing a 3.75 and a 29 ACT will be rewarded with $6000/year, and that’s coming off an already low out-of-state tuition and fees cost of $15,000 after CMU shows you some love with their tuition discount programs.
Seriously…if your kid digs the Colorado thing, especially that corner over by Utah, New Mexico and Arizona…why wouldn’t you take a hard look at Colorado Mesa?
Your teen’s best part-time job
I wrote that phrase – your teen’s best part-time job – not to suggest that 16-year-olds shouldn’t bag groceries or mow lawns or be a nanny. I just want to be painfully clear that efforts and achievements in the classroom can have tremendous potential ROI, and should be taken as seriously as the time spent working, playing sports or practicing the oboe.
It’s not my goal to put pressure on your kid to be a 4.0 student. I just want them to understand that grades and test scores don’t just happen, and sometimes a small amount of effort or just attention to detail makes a big difference. The billboard I’d put up has a simple message that all students can achieve.
Turn in all your homework. On time. All the time.
I’ll skip the $8000 German take-home vocabulary quiz story mentioned on the podcast.
Merit aid is real and it’s within your reach
For the vast majority of students, a merit scholarship based on academics is far more likely than an athletic, music or theater scholarship, and probably reduces your costs of higher education significantly more. So know what matters to colleges in terms of admissions but also in terms of merit aid, and let your student know early on. We did this with both our sons when they were in middle school, and both earned merit scholarships for out-of-state public universities that saved them and us tens of thousands of dollars.
Having a conversation beyond the numbers
If you’re struggling with any part of this – or if you just want to talk to someone who thinks about this everyday – email me anytime or schedule a free consult and let’s talk not just about the numbers, but about your family and your students, and what you hope to achieve.
On May 7, the University of Wisconsin Board of Regents approved a new “test optional” policy for 12 of the 13 UW System campuses. We did a FB Live video regarding this announcement on May 8. You can view it here. The University of Wisconsin-Madison, the state’s flagship university, will still require ACT or SAT scores as part of college applications. For all other UW System schools, the class of 2021 and 2022 will not be required to submit an ACT or SAT score as part of the freshman application. Here are answers to common questions you may have about this announcement.
Do I still have to take the ACT with all other juniors next March?
Yes. As of now, the state-mandated ACT exam will be administered to all Wisconsin public high school juniors on March 9th, 2021 and is required.
Should I still prepare to do my best on the ACT or SAT? What importance does it have?
Yes. Standardized test scores (ACT or SAT) remain one of the top three criteria for the majority of colleges in the United States. For the University of Wisconsin-Madison and the majority of colleges beyond the UW System, a strong score is an essential piece of your application. Most sophomores and juniors do not yet know the complete list of colleges to which they’ll apply. Ensure you’re fully prepared and have the greatest number of options available to you when it’s time to complete college applications by earning your strongest possible ACT or SAT scores. Proven ACT Test Prep programs can help, or you can prep on your own.
What does “test optional” really mean?
Test optional simply means that you have the option of submitting an ACT/SAT score. You CAN submit ACT or SAT scores. It is not required, and by not submitting a score, you won’t decrease your chances of admission.
What if I have a good ACT score? Will they just ignore it?
Not at all. You’ll still be rewarded for a strong ACT/SAT score if you submit it as part of your application. Test optional does not mean “test blind”.
Should I still submit my ACT or SAT score to a test optional school?
The answer is sometimes. It depends. For insight specific to your situation, schedule a free consult anytime. In general, for “test optional” schools, you should submit your score if it will improve your chances for admission and/or merit aid. Think of your college application as a portfolio that tells the story of you. If your GPA is on the low end of the school’s average GPA for admitted students, an ACT or SAT score that falls within the school’s “middle 50% range” for admitted students could help. You can find the “middle 50% ACT range” on a college’s website or use a site such as collegedata.com to find this. Your score should fall within this range, and ideally toward the higher end of that range. Other factors such as cumulative GPA and extracurriculars can impact the score you may need for your best chance of acceptance.
What about the impact of an ACT or SAT score on scholarships and merit aid?
Many colleges and universities reward strong academic performance with merit aid scholarships. Of the factors used to determine awards, the two most common are your cumulative GPA and ACT/SAT score. In many cases, a score beyond what you “need to get in” can dramatically increase your scholarship, and that extra effort and even expense to prep can make a big difference in which schools are affordable. Since merit aid policies vary greatly, you may wish to contact the admissions or financial aid office of any test optional schools on your list to know if ACT/SAT will or will not be used for awarding merit scholarships.
I still have questions about ACT scores, SAT scores and college admissions. How can I get answers?
We’re always here to help. Email Tom Kleese with questions, call Tom directly at 608-553-3445 or schedule a free consult. Freshman, sophomore or junior year is a great time to come in, get your key college questions answered and develop a plan for achieving your college goals.
ACT Scores and Merit Aid Payback. One graphic. Two compelling conclusions.
ACT Scores and Merit Aid Conclusion #1: Sometimes one more point on the ACT CAN make a difference. More points = more better.
ACT Scores and Merit Aid Conclusion #2: If you’re not already considering schools outside the UW System, maybe you should be.
In my view there are a few truly beautiful things in life. Sunsets, rainbows and vast mountain ranges come to mind. Toward the top of my list of beautiful things are graphics like this one about ACT scores and merit aid. It’s stunningly compelling. I’m a college data geek, and I spend countless hours pondering things like this. There are so many insights to be gained from it. The families I’ve shared it with usually respond with wide-eyed amazement and a “wow…”.
Conclusions About ACT Scores and Merit Aid Opportunities
When you’re deciding whether to invest time, energy and money on ACT Test Prep, you want to know if it’s worth it. There are two key reasons to boost your ACT score: One, to “get in”. Two, to get money.
It’s not usually easy to determine what college will cost you. More schools are now making cost a bit more transparent by making merit aid (sometimes called merit-based scholarships) publicly available online. All colleges have a net-price calculator on their website, but most don’t ask for academic information that could impact your score. Some schools post net-price calculators on their sites where you can put in personal information and get an estimate of the price you’d pay.
University of Alabama
We used merit-based scholarship information available on a few school websites to build our infographic. Here are a few key insights:
Holy cow! At the University of Alabama and the University of Mississippi, every single ACT point gained from 27-32 earns you more money!
Wow, at some schools, merit aid scholarships start in the low 20s for ACT scores.
Zowie! With a 28 on my ACT, Minnesota is actually more expensive for me than KU or Ole Miss.
Man, with a 30 on my ACT, I’d pay the same at KU as I would at UW-Madison. And Alabama or Ole Miss is actually less expensive.
Holy Toledo! If I can earn a 32 on my ACT, tuition & fees at Ole Miss are FREE, and Alabama’s next to nothing!
Wow, depending on ACT scores, there are private schools out there where merit aid really helps bring the cost at least somewhat closer to tuition for Minnesota or Wisconsin.
University of Mississippi
Granted these are only a few schools, and perhaps you’re not interested in any of them. But if this is the case for just a sampling, what about colleges you’re interested in?
Conclusions About In-State versus Out-of-State Tuition
Here’s where things get interesting. We’ve all heard someone scoff, “What fool would ever pay out-of-state tuition?” I would, if I could get it for less than I could while attending an in-state school and/or if that school was the best fit for my child. In other words, based on my personal criteria, I’m going to make an informed decision based on what I feel is the best VALUE, the best CHOICE FOR ME. That is what an informed College Search process SHOULD BE about.
Xavier University
Here are a few compelling conclusions from the infographic:
Holy cow! Depending on your ACT and GPA, going out of state may actually be cheaper!
Man, with a 30 on my ACT, admission to UW-Madison may not be a lock, but Alabama or Ole Miss would be less expensive anyway.
Hmmmmm, the SEC delivers as much athletic pageantry as the Big 10. And it may deliver a quality education for a great value, too.
The point is, before you make assumptions, do your homework.
Working With a Professional College Planner Can Pay Off
University of Kansas
I’m passionate about helping students and families explore and effectively weigh their options once they’re armed with correct and complete information. Nothing pleases me more than helping a student find some great options they never knew existed or were previously unlikely to add to their list.
There’s a version of this graphic for each and every student, based on the schools YOU want to put on the list and the academic achievements you’ve earned. This is exactly the type of work we do as part of our College Search program. It’s not always about getting in. Sometimes it’s about saving money. A professional college counselor like OnCampus College Planning has the experience and expertise to help you discover hidden gems and high-value colleges that could reward you financially for your achievements.
Do I still have to take the ACT with all other juniors next March?
What does “test optional” really mean?
What about the impact of an ACT or SAT score on scholarships and merit aid?
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