August 2012 E-Newsletter

posted Aug 1, 2012, 7:09 PM by Glenda Durano   [ updated Aug 9, 2012, 9:39 PM ]

GOT MERIT AID?

            Almost every student (and certainly every parent) that I speak to is interested in obtaining some sort of financial aid in order to help cut the out-of-pocket cost of college.  Most believe that they will not qualify for need-based aid (often mistakenly, I might add, when it comes to institutional need-based aid. Therefore, they look for merit-based aid.  Competition for merit-based aid is fierce in today’s economy. Some students think that the key to obtaining college scholarships is a great standardized test score; others believe that merit aid hinges on the perfect GPA.  (Nearly 60% of students who apply to college, by the way, have a 4.0 weighted GPA or above!)  The truth is, however, there’s more than meets the eye when it comes to institutional merit-based aid.  (By "institutional," I mean  "the aid comes from the university itself"—not an outside corporation or the government.)

Colleges base merit aid awards on any number of things—some merit awards are based on “academic merit,” but many awards are simply a result of wanting to attract a particular “kind of student” to that university through a practice called enrollment management.  Let’s say, for example, that a university wants to raise the GPA of its incoming freshman profile.  It might offer $50 or every “A” that a student has on his transcript in order to entice those straight A students.  Perhaps a particular college craves bragging rights that it has “a student from all 50 states.”  It might give $5000 to a student from a nationally under-represented area (such as New Mexico.)  Maybe the school has a marching band that desperately needs a tuba player.  Cha-ching! Add another $2,000 or $3,000.  The same is true if a school is looking for a great addition to its rugby team.  If a school were trying to “grow” its anthropology department, it might offer additional aid to freshmen who declare anthropology as a possible major, in an effort to attract those students.  Now, do you see why it can literally “pay off” to “target” your applications to schools that value you for who you are?!

Don’t misunderstand. Certainly, GPA’s and test scores are critical in merit aid.  In fact, some schools use a “chart” to determine how much merit aid a student will receive based on his GPA and test scores.  Many times, however, this is simply a starting point.  Depending on how “attractive” a student is to a university (meaning how good of a “match” the university believes the student is to its student body), a college can offer a student thousands of dollars in financial aid, but rather than calling it a “bribe,” it calls it “merit aid.”  The reality is, however, most families don’t really care “why” they are being offered money; they are just delighted to accept it.

These days, a full tuition merit scholarship is difficult to obtain.  A student must not only have stellar grades and test scores, he must also show several areas in which has been passionate in his high school activities—and not necessarily in sports. (Approximately 30% of high schoolers consider themselves “athletes,” so simply playing on an award-winning football team isn’t going to make you a standout student.  You have to be exceptional!) Ultimately, a student may end up better financially in terms of school aid, if, instead of spending 20 hours a week practicing soccer, he demonstrates his ability in a potential interest area because this shows that he is focused and committed, two traits that colleges find very attractive. This does however, depend on both the student and the school.  There are very few hard and fast rules when it comes to merit-based aid. Overall, most universities would much rather offer two half-scholarships, rather than one full-scholarship because this way, they fill two beds, and they still get some form of payment.  If a student really needs merit aid, he needs to look in the right place!

Large amounts of merit aid are most prevalent at private universities, who routinely discount their tuition by half through merit-based aid.  These schools are well-endowed financially, and they know they are competing with less expensive state schools.  Many times, through merit aid, a private university may actually cost less in the long run than a public school.   Unfortunately, however, families frequently don’t even consider these smaller private schools because of the price tag of the university.  Families aren’t aware of the enormous price slashing that goes on at these schools. 

Public universities also offer merit aid, but usually it is a much smaller amount because, of course, the price tag is also less at most public schools (unless we’re talking the California system)!  One of the most interesting trends in merit aid is the fact that much in-state merit aid is being offered to wealthy in-state students because schools know that wealthy students have a greater chance of developing into wealthy alumni who may ultimately have the ability to contribute to the school’s annual fundraising campaign.  This enrollment management technique often results, however, in out-of-state students garnering very little merit aid. 

Another point of confusion rests in the fact that top-tier schools (and I do mean TOP) offer less merit aid than excellent, second-tier schools.  Why?  Because EVERYONE who attends a school like Harvard, Brown, or Amherst is meritorious.  While Ivy League schools don’t offer merit aid, students need not despair.  They are extremely generous with need-based aid, and frequently families with incomes of over $100,000 receive financial aid.  

Merit aid is a fascinating subject, but it also differs across the board.  Last year, the University of Rochester disclosed their unique “formula” for merit aid.  Students were offered specific amounts of money if they fulfilled certain criteria:

$3,000-For contacting an admissions counselor (This shows “demonstrated interest.”)

$2,000-For living out of state

$62-For every “A” on a student’s transcript

$400-For every “rigorous” high school course that the student has taken

$1,800-For an excellent letter of recommendation

$115-For every 10 point increase in the SAT above the “average” student’s score

$425-For every 1 point increase in the ACT above the “average” student’s score

$400-For completing the application on time

$1700-The average amount that a student received in merit money if his parent filled out the FAFSA

$2500-The average amount that a student received if his parent submitted both the FAFSA and the CSS Profile (a form utilized by some private universities).

As you can see, it does add up!  As you can also see, I hope, the advice that I offer students regarding contacting colleges, preparing for tests, taking a rigorous curriculum, etc. really does pay off.  In a very real way, the potential that a student demonstrates throughout all four years of high school determines how much merit-based aid he will receive. 

If you have a student who is in high school and needs one-on-one guidance, please contact College Advising and Planning Services at 505-918-7669 or write to glendadurano@gmail.com.  Our comprehensive program includes career assessments, activity advising, financial aid information, creation of a college list, tips on school visits, application assistance, essay editing, and much more!

Remember our free “College Knowledge” workshop at Cherry Hills Library on Monday, August 27th at 6:30 pm:  “The M&M's of College Admissions: Methods, Mistakes, Myths, and Money."

As always, please forward this newsletter to other friends who might be interested in college planning information.  Do remember to check out the “upcoming deadlines” section of the website for a monthly calendar of what you should be doing this month to stay on track with the college planning process.

Additionally, you can “like” our FACEBOOK page (College Advising and Planning) where I post interesting articles and videos about college planning.

 

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