The language of financial aid brings new—and sometimes confusing—vocabulary for many families. Gail Holt, Amherst’s dean of financial aid, and Dino Koff, director of financial aid at Dartmouth, join AB host Lee Coffin for a lesson in how to interpret and translate this new language. “Let’s demystify the financial process,” Koff offers.
The language of financial aid brings new—and sometimes confusing—vocabulary for many families. Gail Holt, Amherst’s dean of financial aid, and Dino Koff, director of financial aid at Dartmouth, join AB host Lee Coffin for a lesson in how to interpret and translate this new language. “Let’s demystify the financial process,” Koff offers.
Lee Coffin:
From Hanover, New Hampshire, I'm Lee Coffin, Dartmouth's vice president for admissions and financial aid, and this is Admissions Beat.
(music)
Here's our annual conversation about financial aid. And when I say our annual conversation about financial aid, I've really come to appreciate over my many years of doing admissions is that the ampersand in my title, admissions & financial aid, is not something I can separate. One informs the other. And for many families like mine almost 40 years ago, the idea of going to college was fundamentally predicated on need-based financial aid or, in my dad's more uninformed language, “you need to get a scholarship or I can't pay for this.” I think there's a lot of families out there wrestling with that same urgency of honoring the aspirations of a high achieving student, or even more broadly, a student who sees a future that leads to a bachelor's degree. And the cost of attendance for many families is a non-negotiable part of the search and sometimes a non-starter for student choice.
So today I'll be joined by two longtime financial aid experts to go over the ABCs or maybe since it's financial aid, the one, two, three’s of financial aid and to give you a playbook about how to complete FAFSA, how to look at a financial aid award, how to think about cost and what's doable and for students to think about how much of an investment you want to make in yourself. So we'll be right back.
(music)
Once again, Dino Koff, director of financial aid at Dartmouth, returns to Admission Beat. Hi, Dino.
Dino Koff:
Hello, Lee.
Lee Coffin:
For new listeners, Dino has been my colleague in financial aid for my entire time here. He is the dad of two daughters, so he is both a financial aid practitioner and a parent who felt this in real time a few years ago as his two daughters wandered through their college searches. And I asked Dino to pick a pal to join us today for this conversation and he chose Gail Holt, the dean of financial aid at Amherst College. So Gail, welcome to Admission Beat.
Gail Holt:
Thank you very much, Lee. It's great to be here.
Lee Coffin:
I love to ask my guests to share their admissions origin story. So Gail, go back to high school. Tell us about how you got from there to college.
Gail Holt:
Great. Well, I am the child of a college professor. And my father was at the early stages of starting computer science when that was a new department at an institution. But generally speaking, college was always expected and assumed in my household. So it was a matter of where are you going to go, not when or how. And so because of that I didn't have to worry or choose college based on cost. And I always believed that there was a freedom to that, that I absolutely did not appreciate when I was 18 years old. But now that I've been in financial aid for 30 years, what keeps me here is I feel like everybody should have that privilege that I had. That higher education is there to provide the pathway for what you want to do and it should be a choice and a pathway and create independence and security. And so I want to be part of making that possible for as many students as I possibly can.
Lee Coffin:
Love that. Well, and Dino, did you know that you have that same origin story as Gail?
Dino Koff:
I didn't.
Lee Coffin:
So our friend Dino is also the son of a college professor.
Dino Koff:
Double that. Two college professors. So that is so true in terms of “I was going to college.” That wasn't a choice. My choice, which was interesting was when financial aid was not as well-resourced at Ivy League schools. My sister went for a year to a very, very expensive school and my parents told my brother and I, the SUNY system is amazing and it was amazing and is amazing. But there was no question college was there. It was a matter of where and then affordability took over.
Lee Coffin:
No. I love that. I both love that the two of you have known each other for a long time and didn't realize that your parents were professors. So that's a fun serendipity out of our podversation. But it's an interesting point you both make too about appreciating where you are when you're in high school and the decisions families make about where to go to college, what's affordable are very individualized and do not always determine where you end up. So I love that. So thanks for sharing that with us.
Gail Holt:
Thank you.
Lee Coffin:
So I thought what we would do today is put a pin in the word “demystify.” Because I think a lot of families who are looking at college admissions get lost in this whole idea that wow, it's so expensive. And think if you are on the first-gen side of college then this conversation might even be more daunting. So by way of an opening, what might either one of you say to reassure listeners that this is a doable proposition? Let Gail go first as our new friend.
Gail Holt:
Thanks, Lee. Well, I think the reason it's daunting is because the process, the language, the people ... Everything is new for family. So it's akin to learning a new language. So I invite people and parents to step in with me. This is my very first appearance on a podcast so I'm with you in doing new things and sometimes we need to stretch ourselves.
But Dino and I have been doing this a long time. I've been a practicing financial aid professional for 30 years. And what is awesome is that in those 30 years you see over and over and over again families making it through the process together with us. And so you meet them as an admitted student and they say, "Oh my lord, how am I going to meet these obligations? How is this going to work?" And we get the privilege of seeing them as they're leaving four plus years later and there's that sigh of “I did it.” And so being able to repeatedly tell families it's not going to be easy, but nothing worth doing is easy. So the investment is there and there's so many people who want to support our talented students wherever they may go. And we're so privileged in this part of New England as well as the entire United States to have so many schools where students can be successful.
Lee Coffin:
That was reassuring. I listened to that as a financial aid student and I thought, yeah, that would've helped my parents take a breath. Dino, what do you add to Gail's?
Dino Koff:
I think Gail hit a home run quite honestly. When we talk about a different language, it's higher-ed speak to talk about what that language is. And it isn't everyday English language. We're throwing words and acronyms in that honestly, this is brand new. And to a first generation college student, it's even more apparent. But also the one thing I would add is we're talking about money. And when we talk about money immediately when you think of the terms like we're looking at things called an adjusted gross income or untaxed income. I have investments. That's in my retirement account. And when we talk about the word demystify, it's bringing everyday language into the process. That needs to happen.
Lee Coffin:
So I love that. So you both said the same thing. So one of my first questions was going to be vocabulary. So let's use the lead you both gave me to toss some words out that parents will encounter that might make them scratch their head. So let's start with, when we talk about financial aid, there is often a misperception around what a scholarship is. So let's start with that. So “scholarship” I think is a word that most people think they understand, but maybe they don't. So let's start with scholarship.
Gail Holt:
And that's probably a great word to start with because not only does it mean different things to parents, you also have institutions using it with a different meaning. So the primary thing for parents to hear is that scholarship means money that doesn't need to be repaid. It is gift money. It generally can be used to characterize merit-based aid, but unfortunately it's not always characterizing merit-based aid. Institutions sometimes like Amherst College, we use scholarship in many of our terms because Amherst has such a rich academic history and is so selective yet Amherst doesn't have any decision of funds based on merit alone. All of our funds are determined based on financial need. And so that can be confusing for families.
Lee Coffin:
And then scholarship has a synonym in some places, which is grant. So for listeners, some colleges will call aid that you don't need to pay back a scholarship, some places will call it a grant. Dino. Is there any difference?
Dino Koff:
Well, so Gail was talking about how scholarship traditionally has been used as a merit award based on talent or ability, whether it's academic, leadership, athletic, things like that. And a grant historically has been used for need-based. But these are one of the isms of higher ed I would say where it's interchangeable now. Where schools are using scholarship and grant interchangeably and you almost have to go and drill down, whether it's on a website or if you're on a webinar and you ask the question, what is this scholarship or grant based on? Because it's been blended and so interchangeably used, you do want to find out what it is and what schools are giving it out based on merit, which could be SATs, could be GPA, could be leadership, could be extracurricular activities. It could be your soccer playing, it could be your playing flute or your singing. But you want to find out what these scholarships or grants are based on.
Gail Holt:
And if it's not based on the type, it could be based on the source. So you will see a little bit more consistency in the term scholarship coming from an institution. And maybe the source of a grant is the federal government or a state government or sometimes a private agency. So sometimes it does indicate the source.
Lee Coffin:
Yeah. Okay. So topic one scholarship/grant. Free money I think is the most simple way to summarize that. But Gail you just mentioned grant. So the next word on the list is Pell. So a Pell Grant is another type of free money. What is it?
Gail Holt:
That is the largest source of free money coming directly from the federal government through us as taxpayers. And so it is primarily geared to the most needy population and is used to level the playing field as much as possible so that students can attend the institution of their choice. It's not given to an institution. That money is given to a student to take with them based on their eligibility to whatever institution they want to go to.
Lee Coffin:
And how much is it?
Gail Holt:
It can be anywhere from a couple of hundred dollars to seven or $8,000 per year depending on Congress and how much they allocate. So I guess I would like to think we're getting up to eight, but I think I might be getting ahead of my legislation a little bit.
Lee Coffin:
Is that in addition to the college scholarship or is it instead of? How do those two pieces of free money fit together?
Gail Holt:
Well, one of the benefits for families is that when they apply for financial aid through an institution or many institutions, the goal the institution is to put all of the sources of funding that a student is eligible for on the table at the same time. We want there to be a single stream for students. We don't want students to have to go to multiple sources to assemble their plate of resources. So we sometimes call it a package, it can also be called a financial aid offer that includes multiple sources. So the money that doesn't have to be repaid could be a combination of institution, money coming from the state, money coming from the federal government all together to equal a total.
Lee Coffin:
So that sounds great. I'm a dad hearing you say that. I want a Pell Grant. How do I get one?
Gail Holt:
You start by completing what everybody's favorite form is. The free application for federal student aid. That's a mouthful. So we call it FAFSA. We can do a little practice with our parents out there. FAFSA. The F comes before the S, so if you really want to impress your financial aid officer, maybe they'll give you a few more dollars you can talk about the FAFSA.
Lee Coffin:
So you fill out the FAFSA. So that's the form that was in the news a lot over the past year for having skidded off track a little bit. So the free application for federal student aid, it's required for anybody applying for federal aid. When's the deadline?
Gail Holt:
That's a great question. The deadline, you want to check with the institutions that students are applying to. So the deadline and the need to file it can vary by institution. But the easiest thing for families to remember is that they should always be looking to file it ... If they're applying to a school regular decision, file it in December or January. If they're looking to apply early decision in a typical year, look to file it in October or November. Families should be thinking about the timing concurrently with the admission application. So whenever your student is filling out an application for admission, maybe through the Common Application, then you should also be thinking about the financial aid components at the same time.
Dino Koff:
I think schools after last year with the FAFSA kerfuffle quite honestly have done a good job of being a little bit more flexible. It was stressful enough getting through the process last year of filling out this federal form. And so it's seeing if it opens December one and you've applied early decision, the goal is to try to fill that out. And work with the schools because the schools had deadlines, it was creating stress and I think processes changed and schools are much more nimble than we have been historically.
Lee Coffin:
And to Gail's good advice to file the financial aid forms concurrently with the admission forms is in most selective admission processes, we try and make the offer of admission at the same time a financial aid offer is extended so that a person can decide based on the full evidence, not you got in and now you have to wait to see if you're eligible or not. Dino, there's a sibling form to FAFSA called CSS profile. What's that?
Dino Koff:
So the CSS profile is a form that is used by many selective colleges that are giving out need-based aid and some other schools. And so not all schools are using this form like the FAFSA that Gail was speaking about. So with that being said, this is a form that goes in a little bit more in-depth compared to the federal form. And schools that are giving out need-based aid typically are asking for more information and this is being collected on this form which takes a little bit longer to fill out. A FAFSA that is done and hopefully everything is working and you're transferring data could technically possibly be done in five minutes where this CSS profile take 20 minutes, a half hour, because you're going question by question. It's really good to have your tax return with you when you're filling out this profile because as you fill it out, it will tell you, look at this line of your tax return and take the number that's there and type it in.
So one of the big differences is you're manually typing in the numbers into this form. But when I say it's going in ... It's giving colleges and universities more information to be able to accurately give out the need-based aid. And that's why schools are using this form. This form has been open, the database has been open for the CSS profile since right around October 1. So families can definitely begin to fill this out if they haven't started with that. And schools will have different requirements. And so you'll want to look at the checklists of each school for the profile. Sometimes they'll ask for if you have a business that you own, they may ask for a business supplement. Or if a family is not married or the parents aren't married, they're looking at a household A and household B, and they might request both parents fill out this form. So a little bit more in depth. Helps the schools give out the need-based money at a different level compared to the federal form.
Lee Coffin:
Okay. So to summarize where we've been: So scholarships and grants…free money. You get the free money by filling out the FAFSA and for some private places that are offering their own need-based aid profile. So two forms sometimes required for financial aid eligibility to be considered. So what's the opposite of free money? So there's parts of this financial aid award that aren't free. What are those?
Gail Holt:
So there's money that you can work for and sometimes people hear it called work-study. You're not necessarily studying while you work. But that is coming typically from a federal source of resources that help institutions employ students and pay them for employment. So some institutions will just call it student employment. And that's a great way for students to have a bucket on the side where they can apply for a job on campus, they can work a modest, typically reasonable number of hours. It could be four to six hours a week. They would earn a pay just like they might at home. And then the money that they receive directly to them, it doesn't go through the school goes to their pocket, they can use that money as part of their educational expenses.
The great part about working on campus is of course the proximity and ease of getting to work. And I think the better reason is that you are surrounded by more supporters. You're learning and getting to know more on campus who care about you being a student, a healthy student, an active student, and also you're gaining skills in the workplace. So all of those things are a good reason to take advantage of student employment. And I always get a chuckle out of parents that say, "Oh, we don't want the student employment because my student isn't going to have time for student employment." And I imagine that they must think in their head that all of the students' free time is going to be devoted to studying and going to class. I try to get them to think a little bit differently that having a few hours a week carved out for something other than class, other than studying and hopefully other than partying, is also a good thing because it's going to really give them well-rounded experience in their institution.
Dino Koff:
This is spending money. This is the midnight pizza. This is “I'm going to go to Boston for the weekend or New York or go up to Canada because I'm earning my four to six hours” or whatever that is. That paycheck comes straight to the student. It doesn't go on a student account. You hopefully set up direct deposit and goes right into the bank account. And when parents hear that, that maybe the bank of mom and dad doesn't have to fund that, they get more excited of the part-time position, campus employment.
Lee Coffin:
I've not heard you say “the bank of mom and dad” before. That's great. Okay. So work-study or student employment is a component of a financial aid award and that eligibility is determined by FAFSA. And the resource that comes to pay the salary is a federal grant. How about a loan? Neither Amherst nor Dartmouth includes loans as required elements of financial aid, but for many places, loans are part of a financial aid award. How does that get determined? Is that FAFSA again?
Dino Koff:
Loans are an insurance policy. They are there just like a health insurance, just like a car insurance. You don't want to use them but they are there for you to take if you need them. But going back to your question to start the process, if you're through filling out the federal form, the FAFSA, if you're federally eligible, that's the form that will start to see what am I eligible for on the federal side,
Gail Holt:
And I think many families understand the toolbox nature of loans in investing in any significant large investment. If people have purchased their own home, if they haven't, maybe they've purchased a car. Sometimes families come out and they say, "Okay. I'm going to save as much as I can so that I have a down payment or I can purchase something out of pocket." But due to the cost of a car or a house, that's often not possible to save the full amount before you need that consumer good. You need a car to get to your job, you need a home, a place to live. And so if you've saved some, then you save some and then you use the loan to fund the rest of it. And so any good financial financing picture should include all aspects of those tools in terms of past savings, family's current income. We could get into payment plans if people are unfamiliar with those. And then using borrowing and your future income to balance out the cost of that large multi-year investment.
Lee Coffin:
I've often said that a student loan is like a mortgage you take on your education. You borrow money when you buy a home, you borrow money for a car, sometimes you borrow money to pay for college. And I always looked at it as an investment on my future and why those monthly payments for the next 10 plus years, in my case, were important. So listeners, a financial aid award package offer has these components to it. So scholarship or grant. The more that you have, the more you're getting free money. They often have self-help. Could be work-study or self-student employment. Self-help could be a loan. You might have an outside scholarship. You get it from your local rotary or the state or your church, that comes into it too. So some colleges will require you to file both FAFSA and CSS. Some will just ask for FAFSA. Whichever system is used, those forms help the college determine your need and then financial aid meets the difference between what we cost and what you can pay when the college meets full demonstrated need.
Gail Holt:
I want your listeners to also hear the answer to a question that I often get, which is how could loans possibly be financial aid? But the loans, the educational loans, and especially educational loans for students that we are talking about are offered guaranteed to the students. So these are young people, 17, 18, 19 years old who are eligible to receive basically taxpayer dollars without any credit worthiness. So I often say to parents, how many of you will just hand over $5,000 to your 18-year-old without specific ability to pay it back? They have no job, they have no credit history, they haven't proven themselves to be able to manage that kind of money. So the loans are guaranteed. They also come with a relatively lower interest on them. They're not credit card rates in the double digits. They're single digits interest. They have a longer repayment. So we're talking, as you mentioned, 10 years. Sometimes a little extended. And there are other programs that are repayment programs in which students can under certain circumstances defer payment if they're going to be in school for a longer period. If they're in a low job earning situation, they can maybe pay less. There are a few different repayment programs. So these loans come with what we consider favorable terms that make them a viable tool in that financing box.
Lee Coffin:
And can parents borrow money as well?
Gail Holt:
They can. And parents should always look at the full breadth of options available to them. The federal loan is currently called the plus loan. The full extended name used to be parent loan for undergraduate students. It got shortened to plus when they started to allow graduate students to borrow as well. There are also many state programs that will lend to families and parents in their state, or even more broadly than that sometimes states have loan programs for students that are attending institutions in their state, but there are a lot of educational loan programs for parents as well that have some favorable terms but not as favorable as the federal student loans. So families should always, if they need to borrow loans, they should always look to the federal student loans first.
Lee Coffin:
So financial aid helps meet need and need is determined by the cost of attendance. I've heard friends thinking about paying for college and they talk about tuition. I'm like, "Whoa. It's tuition, it's room and board, it's travel, it's books, it's insurance." So Dino, explain cost of attendance to our listeners.
Dino Koff:
How I always describe it is what are the expenses that you have essentially to have your full educational experience? So what are we talking about? You mentioned tuition. One part of which could be the biggest depending on what type of school you're at, but tuition and fees. You talked about housing, you talked about food, books, transportation could be health insurance, possibly. You may need a computer. And then there's miscellaneous items. Someone is buying hopefully shampoo and toothpaste and different items like that at home. Well, we want you to have that at college. And so schools will have miscellaneous items in their cost of education. These are all things that allow you the books to study, the computer to be able to continue to study. Transportation, to maybe get to and from the campus or an educational experience. Not in there is a spring break trip, for example. What is it that is leading to you down the path to get a degree? That's what we can put in the cost of attendance. So that's why it's so important. Like you just said, you have friends that say, "Wow. Here's tuition." Well, you have to look at the entire cost of attendance. So that you know tuition may be 60,000, but the entire cost is 82,000. And so you have to look at the big picture.
Gail Holt:
What Dino is highlighting is all of these costs are for one year at a time. I think the other thing that's helpful for new families to realize is that when we talk about a defined cost of attendance or education, those are all costs that every student is going to have. Either they're billed to every student or there's an allowance or an amount that can be expected for every student. So those are the things you should see very clearly on a college's website. Also, I've heard families talk and news publications talk about hidden costs. There should be no costs that are hidden. What there are, I call them situational costs. Because they're not billed to every student, but they absolutely could be incurred by a family. And when families are thinking about, well, what do I budget for? They do need to be thinking about those kinds of costs too. And those kinds of costs can include tuition insurance, it can include health insurance, it could be club sport fees, it could be medical co-pays, it could be emergency expenses, it could be some level of technology. So there are situational costs that can't be included in the defined cost of attendance because they're not billed to every student but could be incurred by different subsets of students.
Lee Coffin:
And would those situational expenses sometimes be covered by need-based financial aid?
Gail Holt:
That's where you start to transition into that demonstrated need and institutions of varying financial strengths. So families come with varying financial strength and institutions certainly come to the table with varying financial strength. So I'll start with your question, which is it depends on the institution. Institutions that are well-endowed, well-resourced probably have programs for some of those situational costs. Amherst and Dartmouth can be included in helping students to cover their health insurance, to help students when they do have emergencies that they need support for. And maybe also in helping to support students with club fees or some trips for students that are of lower socioeconomic status.
Lee Coffin:
Okay. So the cost of attendance, the wise guidance is look beyond tuition and look for all of the different components that add up to this more macro figure for one year of enrollment. So we're talking about cost of attendance. Gail, what are the factors that go into FAFSA and CSS? Like what big piece of information is a family expected to produce to determine eligibility? Everyone knows income will be a primary driver of this, but what else?
Gail Holt:
Household size. So families come in different sizes and it costs more to support a family of six or seven than it does for three as well as assets. And that encompasses a lot of different things. It encompasses cash and checking accounts. It encompasses investments. Depending on whether you're talking about federal or institutional it could include a home or a primary residence. It will include other real estate, businesses, farms, those kinds of investments.
Lee Coffin:
The federal form produced last year introduced a term called the student aid index. So Gail, what is that?
Gail Holt:
The student aid index is an assessment of a family's financial health and it will be used to specifically determine eligibility for the federal Pell Grant that you initially mentioned. And institutions can also use that student aid index as basically the family's first contribution toward those costs. From there, subtracting that student aid index amount from that whole big cost of education, is how a school is going to start looking at what is the demonstrated need for this family. And this is where institutional variability gets really complicated because every family wants an institution to say, "We will take care of the rest. Period." Because the reality is that when families see that student aid index number most are already having heart palpitations because it can be a very intimidating number. It is not an assessment of what a family has leftover or what they can easily pay for education. It is an estimate of long-term financial health. And so it's not designed to be a comfortable number.
Who is it most comfortable for? In reality, it's most comfortable for people who have actually saved a lot and can combine their current income with their current savings. But schools with the demonstrated need will try to put together a financial aid offer to get as close to meeting that need as they can. And institutions that have very little financial resources are going to be looking to the federal resources first and maybe have some merit money and then there might be a gap or money that is not covered. And unfortunately then that's where that falls to the family again. So they have both the calculated number plus the gap in what a school can cover. And that's where it gets really complicated for families to try to make an assessment about is this affordable and manageable for our family? And then there are awesome institutions like ours that I am very proud to be a part of that through years and decades and centuries have been able to accumulate the resource and prioritize students to put it into financial aid and be able to make an offer that includes that money that does not need to be repaid along with a modest student employment and let families focus just on that calculated amount, which still could be very challenging. But it gives them a more limited focus in creating affordability in their higher education choices.
Lee Coffin:
Yeah. Well the student aid index, and that sobering dimension hit me this week and I was visiting a school in New Orleans and financial aid was one of the topics of the program. And we were talking about sticker shock. And one of the points I tried to make was, if you look at what an individual institution costs, the all in cost ... And I said, "For Dartmouth, it's about $90,000 a year." And for many people they see that number and it's lights out. “This is impossible.” Without appreciating the resources that Gail just described, create financial aid policies that meet full need. And at Dartmouth this year, our average scholarship was $72,000 for the entering class. And a dad came up to me and he said, "That really struck me." He said, "Because you cost the most of anybody on this panel, but your scholarship was also the highest of anybody on this panel." I said, "Correct." And he said, "Would it be wrong to say you might even be the most affordable?" I said, "Yeah, that's possible." And the advice I'm giving parents is the sticker cost is one very front-facing piece of data that may not be as true for you as you worry it is. And the student aid index, same thing. It's giving you a projection that begins the conversation with financial aid. Is that, Dino a fair way of saying this as the non-financial aid person?
Dino Koff:
The sticker price. When you hear a school is 85,000, it is 85,000. But for whom? And we've talked about this in the past and we need to make sure that families know that it might be 85,000 for a family or many families, but you really have to look and go through the process to see what is the price to me? And so we talk about sticker price, we also talk about net price. What am I going to pay? The cost of attendance minus free money. After that that's the net cost to me.
And so at our schools at Amherst and Dartmouth, we're looking at over 50% of the student body that is receiving some sort of free money. Money that doesn't need to be repaid. So for over 50% we can comfortably say that over 50% of the school is not paying $85,000 at our institution. That's why it's so important. You can't just look at the sticker price and say, "Wow." You have to look at it and maybe hop on a website that has a net price calculator or another calculator estimate to be able to plug in some numbers to say, "This is the cost to me. It's not 85,000. It's going to be 38,000." And that may allow you to breathe or it might be 15,000. But you have to figure that out. And that's part of the investigation. And as we started this, I think Gail and I would both agree, that's demystifying, that's going back to the beginning conversation.
Gail Holt:
And Lee, I want to make sure that we're able to emphasize exactly what Dino just said. We cannot understate the importance of net price calculators on institutional websites. Because we all live in our own microcosm. We all live and operate typically in an environment where we are surrounded by similarly positioned people. We're a very financially segregated country, I believe. And so when people at an institution that costs $90,000, that's a huge breadth. So it is important to know exactly what percent of students at that institution are paying or not paying that amount, whether it's more than 50%, whether it's nearly 60%, and then what percent maybe are not paying anything toward the bill. And the question there is, well, what does that mean? That could be, it could be 15 or 16% of all students. It could be more than 20% of students who are receiving financial aid. But there are absolutely students that are not paying anything toward the bill. And that's why these net price calculators are so important.
I have heard families at the lower end of incomes that are below the national median say, "Well, my family does okay." Because they're in an environment where they may be on the upper end of the families that they see around them. And then they think, oh wow, am I going to have to pay such a high amount for college? They don't understand themselves in the national context of understanding that a school like Amherst might be giving financial aid to families that have a total income upwards of 250 or 300,000 if they have a couple kids in college. And that may be completely unfathomable to some families. So the net price calculators help to customize and conceptualize for families their ability for our institutions that cost a lot to be affordable.
Lee Coffin:
Yeah. And if you're listening to this conversation as the parent of a junior in high school, it's not too soon to go find a net price calculator and start to think about how in range or not are you? And if you're the parent of a senior and the deadlines are approaching, do it now because you still have time to adjust college lists to include an option or two or five that might be more financially inbound than not. So we've covered a lot of ground around the vocabulary of financial aid, the language of financial aid. I want to ask you a couple of questions before we close, just to step away from vocab for a sec. What do you think is the biggest misconception parents and students have around affordability?
Gail Holt:
I think some of the challenge is that people want to believe whatever they can't afford is going to just be taken care of. And that calculation of what families can pay and their financial health is also put up against an equity lens of treating families similarly and standardizing some of that calculation when we all know that families are not standard.
Dino Koff:
I would actually add there's a school for everybody out there. And it's just making sure you're able to match the school. When I say there's the right fit, the fit may not just be academically, it's also financially. People starting in the process, you may have to do this a little bit quicker, but the juniors, it's a perfect time to go find that school. And it might be, wow, this has my major and I'm doing a calculator and it may be the right fit.
Lee Coffin:
So when parents call, so decisions are released, financial aid is released, your phones light up. What are some of the issues parents are bringing forward at that late step, A, and B, what might they be doing now so that those calls don't happen?
Gail Holt:
The first reaction can be panic because they see a number and the quick response is, but I don't have that money sitting in my checking account, so how could I possibly do this? And that is happening at the same time that they're seeing their child on the precipice of starting the next phase of their life and their education and their future. And they want to provide what their child is thinking they may want that they've potentially fallen in love with an institution and all the student sees is I have to go there. And they can't necessarily conceptualize the sacrifice that the parents are going to have to make. So what can they do now? I think that families should start a conversation about setting expectations. That is so important. And the expectations can go from, “I'm going to do whatever I can to make any institution work for you” to “I can't. Here are limitations I have and obligations that I need to meet for older generations, for younger generations,” for all kinds of reasons. And so let's talk about not falling in love with an institution before we know the financial piece. Let's take all the information together and process it together as a family.
Dino Koff:
Start that conversation now as a family. When we do a calculator, this is what it looks like. Just coming together and being able to say this number, this is what we're going to have to do. Having that conversation, if you're a junior, having the family conversation ahead of time. Knowing that, hey, this is a reach school financially, this is a reach for us. So if we're going to do this, we have to add a couple others that may be a less reach on the affordability tag.
Lee Coffin:
Let me ask you both one last question that's a bit more personal. So you've both been a financial aid officer director for a long time. Why do you do it?
Gail Holt:
That's easy. I love seeing family success. I got into this because I love to work with people to build things and build success. I am trained as a teacher and thought I was going to be teaching my whole life, but fell into financial aid and fell into appreciating the process and demystifying this whole experience for family. So I didn't start as a director of financial aid. I started on the phones. I started getting those calls from panicked families in all stages of the process. Whether they were panicked about the application, whether they were panicked about the results, whether they were panicked about how they would put together a financial plan. And I loved talking with them about the process, educating them on the process and the terminology, and seeing them learn and seeing them succeed. So I feel like I'm a mentor. I've grown up being a mentor to families. That grew into being a mentor to staff.
And that's what I love about my job is I get to work with great people who serve families. I love having the hard conversations because they're centered around education. We don't willy-nilly just decide how much people are going to get. So when people are upset, I'm happy to stop and walk them through exactly how we got to the answer. And I often say, "You may not like the answer I give you, but I want you to understand how we got here so that you can then take that information, you can be empowered to make the best decision for you, for your family, for your future families, and realize success."
Lee Coffin:
Dino.
Dino Koff:
Every day is different. It is putting a puzzle together. That's what the financial aid teams are doing at these institutions. Trying to make it work. Admissions is working really hard on admitting an incredible student body and they're opening the door and we just need to make sure financially and the financial aid side can keep that door open. And there are tough conversations. What I always say is I love puzzles. That's what we're doing. And then when we get to see the outcomes of a student that we were just so excited to be able to admit, and four years later they're walking across the stage and they're entering in, whether it's a grad program, a job, whatever it is, and you're just blown away and so excited. And that's what every day.
Lee Coffin:
Yeah. Well, I often use this phrase on a slide deck when I'm presenting about admissions and financial aid. Financial aid is an investment in people. It's an investment in talent. And it's a resource of course. But I think what you both just said and why I am happy that I have the ampersand on my job to think about admissions and financial aid, the policy side of this as opposed to the ... I'm not making the award, but I'm thinking about how does financial aid make admission possible?
So listeners, I hope what you just heard from Gail and Dino is this human piece. That they are counselors, just like admission officers are. There are people who will work to help you. Doesn't mean we always give you a hundred percent of what you want. Wanting and needing or different verbs. But the goal is to help you make this opportunity happen. So Gail, Dino, thanks for joining me on the Admission Beat.
Gail Holt:
Thank you, Lee.
Dino Koff:
Thanks Lee.
Lee Coffin:
Next week I'll be back with an episode featuring a round table of guidance counselors from Connecticut. So we're going to take a peek into suburbia. And what are some of the things that have suburban parents in a lather as the college admission process moves forward each year. So that'll be interesting. But for now, I'm Lee Coffin from Dartmouth College. Thanks for listening.