Presenter: Dorothy Martin Executive Director of Enrollment Services at Vaughn College

1. Comparing College Costs – Net Price Calculators, Financial Aid Award Letter Review and Shopping Sheet Presenter: Dorothy Martin Executive Director of Enrollment Services at Vaughn College

2. Agenda • Net Price Calculator • Financial Aid Award Letter Review • Financial Aid Shopping Sheet • Q and A

3. Background • Higher Education Opportunity Act (HEOA) • Signed into law on August 14, 2008 • Includes many new disclosure requirements = your institution must disclose information to the public in some manner (e.g., on its website, in its promotional materials) • Requires that institutions have a net price calculator on their websites for full-time, first-time degree/certificate-seeking undergraduate students

4. Requirement • All institutions must have a net price calculator posted on their websites

5. What Is Net Price? • Your net price is a college’s full cost of attendance minus the grants and scholarships you receive. The cost of attendance includes tuition, fees and housing as well as other important costs like books, supplies and transportation. The net price you pay for a particular college is specific to you because it's based on your personal circumstances and the college’s financial aid policies. • The net price, on average, is considerably lower than the published price. For example, the average published price for four-year public colleges is $8,240 per year. But the average net price — what the average family really pays — is just $2,490 per year. For four-year private colleges, the average published price is $28,500 per year, but the average family pays just $12,970 annually

6. What Is a Net Price Calculator? • A net price calculator is a free online tool that gives you a personalized estimate of net price. The federal government now requires most colleges and universities to have a net price calculator on their websites.

7. How Do Net Price Calculators Work? • A college’s net price calculator asks you questions about your family’s finances and may also ask you questions about your GPA, test scores, activities and other things that may qualify you for financial aid. It uses your answers to figure out how much money in grants and scholarships the college is likely to award you. It then subtracts that number from the full cost of attendance to estimate how much the college might really cost you. • Many net price calculators also provide information about other kinds of financial aid you might be offered. These include loans and work-study jobs.

8. Why Are Net Price Calculators Important? • By providing personalized estimates, net price calculators offer a more informed way of deciding which colleges you can afford. Knowing your net price: • Gives you the best idea of what you’ll pay for a particular college • Makes comparing colleges easier • Widens your choice of colleges • When you look at the net price instead of the published price, colleges you thought were out of your reach may turn out to be affordable. A college with a high published price might offer its students a lot of financial aid — so it might actually be cheaper than a college with a low published price. • Also, different students get different amounts of gift aid. That’s where a net price calculator comes in — it figures out what gift aid you might be eligible for.

9. Tips As you use net price calculators: • Answer each question as accurately as possible. The more accurate the numbers you provide are, the more accurate the result. • Remember that they provide estimates only. The actual price you pay to go to a particular college may be higher or lower than the estimate its net price calculator provides.

10. Cost Figures You Should Know • Your personalized estimated net price is the best indicator of what a particular college will cost you. But if you’re just beginning your college search, the types of figures listed below can help you decide if you want to get more information on a college or use its net price calculator. • Average Net Price • The average net price of a college is, in effect, what the average student really pays to go to that college. On this site, average net price is defined as • the cost of attending a college (for an in-state student who lives on campus) minus the average amount of need-based gift aid that the college offers students. • A college you’re interested in might have a published price of $6,000. But its average net price might be only $2,700 — which includes room and board and other costs. That’s a big difference. • You can search for colleges by average net price with College Search. • Average Percent of Need Met • Most colleges are not able to cover 100 percent of a student’s demonstrated financial need. You can get an idea of how much aid a college might award you and your family by checking to see what it has typically awarded other students in the past.

11. Cost Figures You Should Know Con’t • For example, if your family has demonstrated need of $10,000, and the college you are interested in has an average percent of need met of 75 percent, then your financial aid award (for one academic year) from this college might be about $7,500. • You can search for colleges by average percent of need met with College Search. Remember, when you look at the average percent of need met, a bigger number is better. • Average Percent of Gift Aid • Different colleges have different ways of awarding their financial aid packages. The final award is generally divided into a combination of scholarships and grants, work-study jobs and loans. Only scholarships and grants are considered gift aid. • If a college awards you a financial aid package of $7,500, and the average percent of gift aid is 50 percent, then you can expect your award to include approximately $3,750 in grants and scholarships. The rest of the award would likely be a combination of loans and work-study earnings. • Keep in mind that when you look at average percent of gift aid, a bigger number is better.

12. Using the Net Price Calculator

13. Screen 1: User answers basic questions

14. Screen 2: User answers questions

15. Screen 3: User answer questions

16. Screen 4: User reviews information entered

17. Output: Screen 5: Net Price Calculator Results

18. Tips and Reminders • As you consider these key figures, keep the following in mind: • Calculating your estimated net price will give you the best idea of how much a college will really cost you. • Averages give you only a general overview of how a college has awarded financial aid to other students in the past. Financial aid officers at each college will weigh your circumstances before deciding on your actual financial aid award. • You can search for colleges by average net price and by average percent of need met.

19. DISCLOSURE AND SOURCES College Navigator nces.ed.gov/collegenavigator/ Institutions also provide cost information to the U.S. Department of Education that is included in the Department’s College Navigator website. This information includes: • Estimated tuition and fees (including in-state and out-of-state costs when applicable) • Estimated books and supplies • Estimated room and board • Tuition payment plans • Average net price • Average net price by income level • Multiyear Tuition Calculator to estimate the total tuition and fee costs over the duration of a typical program

20. DISCLOSURE AND SOURCES College Affordability and Transparency Center collegecost.ed.gov • The U.S. Department of Education highlights institutions with high and low tuition and fees as well as high and low net prices (the price of attendance minus grant and scholarship aid). It also shows institutions where tuition and fees and net prices are increasing at the highest rates.

21. Financial Aid Award Letter Review After Applications are Filed… • Schools listed on the FAFSA and/or CSS Profile will receive an electronic record • Schools begin financial aid packaging process • Student may be required to send in additional documentation during this time • When processing is finished, an award letter is sent to the student

22. Next Steps: Award Letter The school’s award letter will contain: • Amount of federal aid for which students are eligible, including loan options • Amount of state aid for which students are eligible • Institutional aid

23. Federal Aid • Pell Grant • Supplemental Educational Opportunity Grant (FSEOG) • Work-Study • Perkins Loan • Direct Stafford Loans • Direct PLUS Loan

24. State Aid • Tuition Assistance Program (TAP) • Aid for Part-Time Study • NYS Scholarships for Academic Excellence • NYS Math & Science Teaching Incentive Program • Veterans Tuition Award

25. Institutional Aid • Depends on funding at each college • College determines eligibility criteria for need-based and non-need-based programs • Academic, athletic, and other talent-based scholarships and grants • May require an additional application

26. Financial Aid “Shopping Sheet” The Financial Aid shopping sheet is a new product from the Department of Education, is designed to help you better understand the amount of grants and scholarships they are being offered and the amount of loans an institution recommends a student take out to cover out-of-pocket costs. It is a good tool you can use to educate yourself to be a better “shopper” and consumer.

27. ANNOTATED: Financial Aid Shopping Sheet • Student Information • *Student name/identifier; date issued (right side)  • *Individual student’s cost of attendance  • *The sum of each grant sub-category appears here; campus-based FSEOG and TEACH Grants would appear under “Grants from Your School.”  • NET COST AFTER GRANTS  • *Aid awarded by school but earned through work  • *School recommended Federal loan amounts; state and institutional loans appear below in the customized information box.  • *Other funds that can be used to meet net costs; includes family contribution—FAFSA-calculated or institutional methodology  • *Space for institution to send custom message 

28. ANNOTATED: Financial Aid Shopping Sheet • Institutional Performance Metrics • (All data supplied by the Department) •  Student Right-to-Know graduation rate compared to the rates of similar institutions (Source: IPEDS) •  Most recent cohort default rate compared to the rates of similar institutions (Source: NSLDS) •  Median debt for undergraduate borrowers entering repayment (Source: NSLDS) •  Loan repayment calculator •  School contact details: for more information and next steps

29. Financial Aid Shopping Sheet Students, parents and institutions may email ShoppingSheet@ed.gov regarding any questions about the Financial Aid Shopping Sheet .

30. "Understanding the True Cost of College Act" Sen. Al Franken (D-MN) introduced the "Understanding the True Cost of College Act" to mandate higher education institutions use a standardized award letter, uniform financial aid terms, and provide information about student loan repayment and a host of other student aid-related disclosures.

31. Required Content • Specifically, Franken’s proposal would require schools to include the following information and disclosures in a “consumer-friendly” manner that is “simple and understandable” on the first page of the award letter (whether in printed or electronic format):

32. Required Content Con’t • Student’s Cost of Attendance (as defined under Title IV of the HEA). Including the most current costs for tuition and fees; room and board; books and supplies; transportation; and miscellaneous personal expenses. • Amount of Aid Student Does Not Have to Repay. Including scholarships; Title IV grant aid; institutional, state or private scholarships. Must also include a disclosure stating that this aid does not have to be repaid and noting whether the student can expect these funds for future academic periods. • Net Amount Student Will Have to Pay. Defined as the cost of attendance minus aid the student does not have to repay. • Work Study Assistance. Including a disclosure that this aid must be earned and the assistance is subject to the availability of jobs. • Recommended Direct and Perkins Loans. Including disclosures that loans have to be repaid; students can borrow a less than the school recommends; interest rates and fees; expected monthly repayment based on standard 10-year repayment; and expected total repayment over the life of the loan. • Where the Student Can Find Additional Information About Offered Aid. Including contact information for the student aid office on campus and the U.S. Department of Education. • Benefits of Federal v. Private Loans. Must include a disclosure indicating that Federal loans are generally more favorable than private loans and that students should examine all Federal loan options before considering private loans.  This section would also include a note from the Secretary of Education describing benefits unique to Federal loans, including repayment plans, deferment, loan forgiveness provisions, and the terms to examine carefully if considering a private education loan. • Key Deadlines. Deadline for accepting the financial aid offer and a summary of the process for doing so. • Covered Academic Period. Must specify the academic period covered by the award letter as well as assumed enrollment status. • Cohort Default Rate.  Provide most recent CDR along with a comparison to the national average CDR. (Note that this provision is only applicable to institutions where more than 30 percent of enrolled students borrow.) • Additional Information. The bill provides the Secretary of Education the authority to include any other relevant information related to student loan borrowing that would help students and families make informed decisions.

33. In addition, the bill would mandate that the following additional disclosures appear on the award letter: • The financial aid award is only for one academic period and that their package may change in the future. • How non-institutional scholarships affect the student’s financial aid package.  • A summary of the process for renewing Federal and institutional financial aid and a way to obtain additional information, for example by linking to supplementary information. • Include a subtotal for each category of aid offered. • Use standard definitions and terms, developed by the Secretary of Education.  • If the institution recommends less Federal loan aid than the Federal maximum available to the student additional information on Federal loans must be provided in an attached document or webpage. • Use standard formatting and design, as developed by the Secretary of Education, subject to consumer testing. The bill further directs the Secretary regarding fonts, order of information, and consistency between written and electronic formats.  • Include an attestation that the student has assessed and read the offer form if provided in electronic format. • Include language developed by ED notifying eligible students that they may be eligible for VA education benefits and resources for more information. • An institution may offer additional information that supplements the aid offer form but is not located directly on the form. 

34. Q & A Questions and Answers