How to Compare Financial Aid Packages

Ana-Marcela Lopez / Colleges of Distinction »

83.8% of college students benefit from some form of a financial aid package.

But not all types of financial aid are created equal. What may look like a great financial aid option, in the beginning, could end up creating large amounts of debt. Other options that may not seem valuable may turn out to be renewable options worth thousands.

Finding the right financial aid offer for college requires knowing your options. The following guide explains how to compare financial aid packages.

Review Types of Financial Aid Offered

Your first step is to review the financial aid that you’ve been offered. Colleges will either accept applicants on a rolling basis, or they’ll send out acceptance letters in late March or early April.

Around the same time you receive acceptance, you’ll typically receive financial aid award letters. Your financial aid package will include different kinds of aid, including state grants, college-soured scholarships, work-study programs, or student loans.

Grants and scholarships are awards based on merit or need. These do not need to be paid back. Some colleges may offer students yearly scholarship options upon acceptance, or they could offer a one-time grant.

Work-study programs are federally-run financial aid offers that typically split income so that part of it goes to the student and part of it goes toward the cost of attendance. Most schools will offer work-study options, but earnings will cap at the amount listed. Many work-study programs offer only part-time hours.



Student loans are financial aid options that require students to pay them back over a given time period. The US Department of Education pays the interest on subsidized loans if the student remains in school and for the first 6 months after leaving school.

Note that your financial aid award will indicate how much you can borrow from federal or institutional student loans, but it won’t give you an exact number on private students loans.

If you do not review what you need from your financial aid award, you may want to apply for private student loans separately.

Look for Renewable Aid

Your financial aid offer will reveal the cost of attendance for your upcoming year of school. But you’ll likely have 3 (or more) years of college beyond this first year. It’s important to include your entire time in college when thinking about the cost of your degree.

When you consider the types of financial aid from each school, look at the aid package you’re receiving for each year. You may be offered certain aid for only one year. In other cases, your aid is renewable.

Spend some time looking into renewal requirements. In many cases, you will need to meet certain academic standards set by the school. This often means completing your degree within a certain period of time and with a certain GPA.

Estimate Your Individual Cost of Living

Some financial aid award letters will include helpful information to consider your aid packages. They’ll list an estimated cost of living when attending that school, including housing, books, and food.

But this information may not always reflect your true cost of living. For instance, a school’s estimated cost of living for housing may be different if you choose to live off-campus. Or, you might spend less on textbooks because you buy them used.

Instead of taking the school’s cost of living figures as the truth, think about how you would actually be living should you attend that college. This will give you an idea of how valuable a school’s financial aid package is.



Take into account the location of your school. You may choose to attend a school that is close to home and live with your family to save costs. Should you attend school in New York City and live in an apartment, your costs will go up.

Thinking about how the lifestyle choices you make will help you make the decision on schools. For instance, you may end up deciding on a school with a lower financial aid package with the understanding that you will have a tighter budget attending that particular university.

Calculate True Cost of Attendance

With an understanding of your living costs and the aid that you have available to you, it’s time to calculate your true cost of attendance. Your true cost will reveal what you’ll be paying for college.

The true cost of attendance will factor in the types of aid that you receive.

For instance, comparing the net cost of attendance at two different schools might reveal the same number. But upon closer inspection, you realize that one school gives you more in grants, while the other requires you to take out $10,000 more in loans each year.

While the net price may be the same, the true cost varies significantly. You’ll have to pay $40,000 in loans plus interest.

Consider prioritizing schools that offer you a higher percentage of gift money or schools with a lower price tag. Remember that private institutions, on average, cost almost $30,000 more a year than public, in-state universities.

The more you save on loans, the less you’ll have to repay in the future.


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Remember More Aid Is Possible

Your first financial aid offer from your dream school doesn’t necessarily have to be the final one. If your heart is set on a college whose financial aid offer can’t cover all of your costs, you may want to consider negotiating your financial aid package.

The negation process happens via a professional judgment appeals process. To do this, contact the school’s financial aid office to discuss your situation. There may be a way to ease your financial situation.

Remember that you can also update your FAFSA. If there is a large change, like a parent having another child or losing their job, you may be eligible to receive more aid.

While you’re not guaranteed to receive more aid, you never know what will happen if you ask. You may be surprised at the outcome – the financial aid office can point you in the direction of more grants and scholarship opportunities, even if they can’t help you directly.

Determining Your Best Financial Aid Package

Finding the best financial aid package for your needs requires research. Setting aside time to look into financial aid packages and weigh your options will allow you to make the best decision.

Interested in finding the best school for you? Use our college finder to search by program or location.