The Language of Financial Aid

The Language of Financial Aid

New England College Board ForumBoston, MA

February 3, 2011


byC. Anthony Broh

Broh Consulting Services, LLC

Lake Superior State University:“List of Words Banished from Queen’s English for Misuse”

Friend (as a verb)Google (as a verb)

I’m Just SayingLive Life to the Fullest

Man UpMama Grizzlies

RefudiateViral

Bulwer-Lytton Award: “Worst Opening Sentence in a

Novel”For the first month of Ricardo and Felicity's affair, they greeted one another at every stolen rendezvous with a kiss--a lengthy, ravenous kiss, Ricardo lapping and sucking at Felicity's mouth as if she were a giant cage-mounted water bottle and he were the world's thirstiest gerbil.

Financial-Aid Speak

Cost of AttendanceAward

Expected Family ContributionGap

Meet Full NeedMerit-based AidNeed-based Aid

Need-blind Admissions

Financial-Aid Speak

•Evolves from the work that Financial Aid Administrators do

•Is accurate for an earlier era•Is Institution centered•Is not consumer friendly•Is often misunderstood•Is sometimes misleading

Toward a Consumer Friendly Language

•What is the Price?•What is the Risk?•How Does it Compare to Others?

Objective

To provide a bridge between the Language of Financial Aid and the

Language of the Consumer

The “Consumer” Story

Who? The family and the studentWhat? Price and QualityWhere? Online at home or libraryWhen? First thinking about collegeWhy? Planning for college

Assets, Savings, and 529Other Investments

Taxed and Untaxed Parent IncomeEmployer Benefit Program

PLUS Loan ProgramHome Equity Loan

Other Private LoansSavings and other Assets

Summer wages and job earningsFederal Work Study ProgramState Work Study Program

Institutional Work Study ProgramOutside Scholarships

Unsubsidized Stafford LoanState Unsubsidized Loan Program

Institutional Student LoanPrivate Student Loans

Credit Card Debt

Subsidized Stafford LoanPerkins Loan

Subsidized State LoanInstitutional Loan Program

State GrantsInstitutional Grants

Other GrantsPell Grant

Academic Competitiveness GrantSEOG

Other Federal Grant

Merit Scholarship

Athletic Scholarshipo

Federal and State Tax Credits

ROTC

Inst

itutio

nal

Subs

idy

Su

bsid

y

Scholarships

SubsidyUsually ignoredDepreciation on Physical Plant, Current Institutional

Gifts, Earnings from Endowment

Pr

ice

Red

uctio

n

Federal Grants

Other Grants

Narrow Definition:

Scholarship = not family financial position

Gra

nts

Cos

t of O

ne Y

ear o

f Col

lege

T

uitio

n

Fees

Gap

A

Fin

anci

al A

id P

acka

ge th

at M

eets

Ful

l Nee

d

Student Past Resources

N

et P

rice

Sch

olar

ship

s

Gifts and "Other Resources"

Par

ent R

esou

rces

Scho

lars

hips

NEW TERM:

Family Resources =

Parent, Student, and

other Resources

Stu

dent

Res

ourc

es

Subsidy

Pric

e of

Atte

ndan

ce

Institutional Language

I

nstit

utio

nal C

osts

A F

inan

cial

Aid

Pac

kage

that

does

NO

T m

eet F

ull N

eed

Stu

dent

Bud

get

R

oom

and

Boa

rd

NE

W

TE

RM

: "T

FRB

"

C

urre

nt D

efin

ition

: "N

eed-

base

d A

id"

Exp

ecte

d

Fam

ily

C

ontri

btui

on

Tran

spor

tatn

&

Boo

ks

Narrow Definition: Grant = family's financial position

N

EW

TE

RM

: C

alcu

late

d A

bilit

y to

Pay

The Language of Financial AidConsumer Language

Student Future

Resources

Student Current Resources

Parent Current Resources

Parent Future

Resources

Parent Past Resources

The Language of Financial AidInstitutional Language

Cos

t of O

ne Y

ear o

f Col

lege

Tran

spor

tatn

&

Boo

ks


Subsidy


R

oom

and

Boa

rd

NE

W

TE

RM

: "T

FRB

"

Cos

t of O

ne Y

ear o

f Col

lege

T

uitio

n

Fees

Tran

spor

tatn

&

Boo

ks


Subsidy


I

nstit

utio

nal C

osts

R

oom

and

Boa

rd

NE

W

TE

RM

: "T

FRB

"

Cos

t of O

ne Y

ear o

f Col

lege

T

uitio

n

Fees

Tran

spor

tatn

&

Boo

ks


Subsidy

Pric

e of

Atte

ndan

ce


I

nstit

utio

nal C

osts

Stu

dent

Bud

get

R

oom

and

Boa

rd

NE

W

TE

RM

: "T

FRB

"

Cos

t of O

ne Y

ear o

f Col

lege

T

uitio

n

Fees

Tran

spor

tatn

&

Boo

ks


Subsidy

Pric

e of

Atte

ndan

ce


I

nstit

utio

nal C

osts

Stu

dent

Bud

get

R

oom

and

Boa

rd

NE

W

TE

RM

: "T

FRB

"

Exp

ecte

d

Fam

ily

C

ontri

btui

on

Cos

t of O

ne Y

ear o

f Col

lege

T

uitio

n

Fees

A

Fin

anci

al A

id P

acka

ge th

at M

eets

Ful

l Nee

d

Tran

spor

tatn

&

Boo

ks


Subsidy

Pric

e of

Atte

ndan

ce


I

nstit

utio

nal C

osts

A F

inan

cial

Aid

Pac

kage

that

does

NO

T m

eet F

ull N

eed

Stu

dent

Bud

get

R

oom

and

Boa

rd

NE

W

TE

RM

: "T

FRB

"

C

urre

nt D

efin

ition

: "N

eed-

base

d A

id"

Exp

ecte

d

Fam

ily

C

ontri

btui

on

Cos

t of O

ne Y

ear o

f Col

lege

T

uitio

n

Fees

Gap

A

Fin

anci

al A

id P

acka

ge th

at M

eets

Ful

l Nee

d

Su

bsid

y

Tran

spor

tatn

&

Boo

ks


Subsidy

Pric

e of

Atte

ndan

ce


I

nstit

utio

nal C

osts

A F

inan

cial

Aid

Pac

kage

that

does

NO

T m

eet F

ull N

eed

Stu

dent

Bud

get

R

oom

and

Boa

rd

NE

W

TE

RM

: "T

FRB

"

C

urre

nt D

efin

ition

: "N

eed-

base

d A

id"

Exp

ecte

d

Fam

ily

C

ontri

btui

on

Cos

t of O

ne Y

ear o

f Col

lege

T

uitio

n

Fees

Gap

A

Fin

anci

al A

id P

acka

ge th

at M

eets

Ful

l Nee

d

N

et P

rice



Pr

ice

Red

uctio

n




Other Federal Grant

Merit Scholarship



ROTC

Su

bsid

y

Tran

spor

tatn

&

Boo

ks


Subsidy

Pric

e of

Atte

ndan

ce


I

nstit

utio

nal C

osts

A F

inan

cial

Aid

Pac

kage

that

does

NO

T m

eet F

ull N

eed

Stu

dent

Bud

get

R

oom

and

Boa

rd

NE

W

TE

RM

: "T

FRB

"

C

urre

nt D

efin

ition

: "N

eed-

base

d A

id"

Exp

ecte

d

Fam

ily

C

ontri

btui

on

Scho

lars

hips

Cos

t of O

ne Y

ear o

f Col

lege

T

uitio

n

Fees

Gap

A

Fin

anci

al A

id P

acka

ge th

at M

eets

Ful

l Nee

d

N

et P

rice

Scholarships



Pr

ice

Red

uctio

n

Federal Grants

Other Grants

Gra

nts




Other Federal Grant

Merit Scholarship



ROTC

Su

bsid

y

Tran

spor

tatn

&

Boo

ks


Subsidy

Pric

e of

Atte

ndan

ce


I

nstit

utio

nal C

osts

A F

inan

cial

Aid

Pac

kage

that

does

NO

T m

eet F

ull N

eed

Stu

dent

Bud

get

R

oom

and

Boa

rd

NE

W

TE

RM

: "T

FRB

"

C

urre

nt D

efin

ition

: "N

eed-

base

d A

id"

Exp

ecte

d

Fam

ily

C

ontri

btui

on

Scho

lars

hips

Cos

t of O

ne Y

ear o

f Col

lege

T

uitio

n

Fees

Gap

A

Fin

anci

al A

id P

acka

ge th

at M

eets

Ful

l Nee

d

N

et P

rice

Scholarships



Pr

ice

Red

uctio

n

Federal Grants

Other Grants

Gra

nts




Other Federal Grant

Merit Scholarship



ROTC

Su

bsid

y

Tran

spor

tatn

&

Boo

ks


Subsidy

Pric

e of

Atte

ndan

ce


I

nstit

utio

nal C

osts

A F

inan

cial

Aid

Pac

kage

that

does

NO

T m

eet F

ull N

eed

Stu

dent

Bud

get

R

oom

and

Boa

rd

NE

W

TE

RM

: "T

FRB

"

C

urre

nt D

efin

ition

: "N

eed-

base

d A

id"

Exp

ecte

d

Fam

ily

C

ontri

btui

on

Scho

lars

hips

Cos

t of O

ne Y

ear o

f Col

lege

T

uitio

n

Fees

Gap

A

Fin

anci

al A

id P

acka

ge th

at M

eets

Ful

l Nee

d

N

et P

rice

Scholarships



Pr

ice

Red

uctio

n

Federal Grants

Other Grants

Narrow Definition:


Gra

nts




Other Federal Grant

Merit Scholarship



ROTC

Su

bsid

y

Tran

spor

tatn

&

Boo

ks



Subsidy

Pric

e of

Atte

ndan

ce


I

nstit

utio

nal C

osts

A F

inan

cial

Aid

Pac

kage

that

does

NO

T m

eet F

ull N

eed

Stu

dent

Bud

get

R

oom

and

Boa

rd

NE

W

TE

RM

: "T

FRB

"

C

urre

nt D

efin

ition

: "N

eed-

base

d A

id"

Exp

ecte

d

Fam

ily

C

ontri

btui

on

Scho

lars

hips

Cos

t of O

ne Y

ear o

f Col

lege

T

uitio

n

Fees

Gap

A

Fin

anci

al A

id P

acka

ge th

at M

eets

Ful

l Nee

d

N

et P

rice

Scholarships



Pr

ice

Red

uctio

n

Federal Grants

Other Grants

Narrow Definition:


Gra

nts




Other Federal Grant

Merit Scholarship



ROTC

Su

bsid

y

Tran

spor

tatn

&

Boo

ks



Subsidy

Pric

e of

Atte

ndan

ce


I

nstit

utio

nal C

osts

A F

inan

cial

Aid

Pac

kage

that

does

NO

T m

eet F

ull N

eed

Stu

dent

Bud

get

R

oom

and

Boa

rd

NE

W

TE

RM

: "T

FRB

"

C

urre

nt D

efin

ition

: "N

eed-

base

d A

id"

Exp

ecte

d

Fam

ily

C

ontri

btui

on

Par

ent R

esou

rces

Scho

lars

hips

NEW TERM:

Family Resources =


other Resources

Stu

dent

Res

ourc

es

Cos

t of O

ne Y

ear o

f Col

lege

T

uitio

n

Fees

Gap

A

Fin

anci

al A

id P

acka

ge th

at M

eets

Ful

l Nee

d

N

et P

rice


Scholarships



Pr

ice

Red

uctio

n

Federal Grants

Other Grants

Narrow Definition:


Gra

nts




Other Federal Grant

Merit Scholarship



ROTC

Su

bsid

y

Tran

spor

tatn

&

Boo

ks



Student Future

Resources



Parent Future

Resources


Subsidy

Pric

e of

Atte

ndan

ce


I

nstit

utio

nal C

osts

A F

inan

cial

Aid

Pac

kage

that

does

NO

T m

eet F

ull N

eed

Stu

dent

Bud

get

R

oom

and

Boa

rd

NE

W

TE

RM

: "T

FRB

"

C

urre

nt D

efin

ition

: "N

eed-

base

d A

id"

Exp

ecte

d

Fam

ily

C

ontri

btui

on

Par

ent R

esou

rces

Scho

lars

hips

NEW TERM:

Family Resources =


other Resources

Stu

dent

Res

ourc

es

Cos

t of O

ne Y

ear o

f Col

lege

T

uitio

n

Fees

Gap

A

Fin

anci

al A

id P

acka

ge th

at M

eets

Ful

l Nee

d


N

et P

rice


Scholarships



Pr

ice

Red

uctio

n

Federal Grants

Other Grants

Narrow Definition:


Gra

nts

Child Parent Other

Past Savings and AssetsAssets, Savings and 529

Other Investments Grandparent 529

PresentSummer wages and job earnings

Federal Work Study ProgramState Work Study Program


Taxed & Untaxed Parent IncomeEmployer Benefit Program Grandparent 401(k) minimum

distribution

Future



Credit Card DebtSubsidized Stafford Loan

Perkins LoanSubsidized State Loan

Institutional Loan Program

PLUS LoanHome Equity Loan

Other Private Loans

Family R

esou

rces




Other Private Loans




Other Federal Grant

Merit Scholarship



ROTC

Su

bsid

y

Tran

spor

tatn

&

Boo

ks



Student Future

Resources



Parent Future

Resources


Subsidy

Pric

e of

Atte

ndan

ce


I

nstit

utio

nal C

osts

A F

inan

cial

Aid

Pac

kage

that

does

NO

T m

eet F

ull N

eed

Stu

dent

Bud

get

R

oom

and

Boa

rd

NE

W

TE

RM

: "T

FRB

"

C

urre

nt D

efin

ition

: "N

eed-

base

d A

id"

Exp

ecte

d

Fam

ily

C

ontri

btui

on

Par

ent R

esou

rces

Scho

lars

hips

NEW TERM:

Family Resources =


other Resources

Stu

dent

Res

ourc

es

Cos

t of O

ne Y

ear o

f Col

lege

T

uitio

n

Fees

Gap

A

Fin

anci

al A

id P

acka

ge th

at M

eets

Ful

l Nee

d


N

et P

rice


Scholarships



Pr

ice

Red

uctio

n

Federal Grants

Other Grants

Narrow Definition:


Gra

nts









Credit Card Debt






Other Federal Grant

Merit Scholarship



ROTC

Su

bsid

y

Tran

spor

tatn

&

Boo

ks



Student Future

Resources



Parent Future

Resources


Subsidy

Pric

e of

Atte

ndan

ce


I

nstit

utio

nal C

osts

A F

inan

cial

Aid

Pac

kage

that

does

NO

T m

eet F

ull N

eed

Stu

dent

Bud

get

R

oom

and

Boa

rd

NE

W

TE

RM

: "T

FRB

"

C

urre

nt D

efin

ition

: "N

eed-

base

d A

id"

Exp

ecte

d

Fam

ily

C

ontri

btui

on

Par

ent R

esou

rces

Scho

lars

hips

NEW TERM:

Family Resources =


other Resources

Stu

dent

Res

ourc

es

Cos

t of O

ne Y

ear o

f Col

lege

T

uitio

n

Fees

Gap

A

Fin

anci

al A

id P

acka

ge th

at M

eets

Ful

l Nee

d


N

et P

rice


Scholarships



Pr

ice

Red

uctio

n

Federal Grants

Other Grants

Narrow Definition:


Gra

nts









Credit Card Debt






Other Federal Grant

Merit Scholarship



ROTC

Inst

itutio

nal

Subs

idy

Su

bsid

y

Tran

spor

tatn

&

Boo

ks



Student Future

Resources



Parent Future

Resources


Subsidy

Pric

e of

Atte

ndan

ce


I

nstit

utio

nal C

osts

A F

inan

cial

Aid

Pac

kage

that

does

NO

T m

eet F

ull N

eed

Stu

dent

Bud

get

R

oom

and

Boa

rd

NE

W

TE

RM

: "T

FRB

"

C

urre

nt D

efin

ition

: "N

eed-

base

d A

id"

Exp

ecte

d

Fam

ily

C

ontri

btui

on

Par

ent R

esou

rces

Scho

lars

hips

NEW TERM:

Family Resources =


other Resources

Stu

dent

Res

ourc

es

Cos

t of O

ne Y

ear o

f Col

lege

T

uitio

n

Fees

Gap

A

Fin

anci

al A

id P

acka

ge th

at M

eets

Ful

l Nee

d


N

et P

rice

Sch

olar

ship

s


Scholarships



Pr

ice

Red

uctio

n

Federal Grants

Other Grants

Narrow Definition:


Gra

nts









Credit Card Debt






Other Federal Grant

Merit Scholarship



ROTC

Inst

itutio

nal

Subs

idy

Su

bsid

y

Scholarships



Pr

ice

Red

uctio

n

Federal Grants

Other Grants

Narrow Definition:


Gra

nts

Cos

t of O

ne Y

ear o

f Col

lege

T

uitio

n

Fees

Gap

A

Fin

anci

al A

id P

acka

ge th

at M

eets

Ful

l Nee

d


N

et P

rice

Sch

olar

ship

s


Par

ent R

esou

rces

Scho

lars

hips

NEW TERM:

Family Resources =


other Resources

Stu

dent

Res

ourc

es

Subsidy

Pric

e of

Atte

ndan

ce


I

nstit

utio

nal C

osts

A F

inan

cial

Aid

Pac

kage

that

does

NO

T m

eet F

ull N

eed

Stu

dent

Bud

get

R

oom

and

Boa

rd

NE

W

TE

RM

: "T

FRB

"

C

urre

nt D

efin

ition

: "N

eed-

base

d A

id"

Exp

ecte

d

Fam

ily

C

ontri

btui

on

Tran

spor

tatn

&

Boo

ks


N

EW

TE

RM

: C

alcu

late

d A

bilit

y to

Pay


Student Future

Resources



Parent Future

Resources


BoardBooks

Calculated Ability to Pay (CAP)Cost of One Year of College

Family ResourcesFederal Grants

FeesGrants

Institutional CostsInstitutional Subsidy

Other GrantsParent Past Resources

Parent Current ResourcesParent Future Resources

Parent ResourcesRoom

ScholarshipsStudent Past Resources

Student Current ResourcesStudent Future Resources

Student ResourcesSubsidy

TFRBTransportation

Tuition

Other Resources:Broh Consulting Services

http://[email protected]

1. NERO PowerPoint Presentation2. Glossary and Definition of 27 Consumer

Friendly Words and Phrases.3. The “Language of Financial Aid” Grid4. Planning for College: A Consumer

Approach to the Higher Education Marketplace

Documents

The Language of Financial Aid