4. Knowing your Student Aid Index (SAI) before the government or college does will save you tens of thousands of dollars.
Old Way
We are guided by an imperfect understanding of how financial aid really works. We overpay by tens of thousands of dollars.
Old Result
We drastically alter the kinds of colleges we think our students can attend and many dream schools are needlessly crossed off the list.
New Way
We calculate our SAI and how the colleges will apply that calculation beforehand and take necessary steps to maximize our financial aid. We recognize that colleges award merit aid based on financial aid leveraging. We drastically alter the kinds of colleges we think our students can attend with less limitations on cost. We increase our college options.
New Result
By knowing and leveraging your SAI in advance, we save tens of thousands of dollars while attending colleges we never thought were affordable.
SAI or college cost calculators on the internet and on college websites all fail to show one thing: How to position your SAI to get your student the maximum amount of financial aid.
Arranging family finances is one area where private consultants can help, says Pamela Fowler, executive director of financial aid at the University of Michigan—who otherwise isn't a big fan of consultants. In some instances, she says, consultants can help a family "better position" themselves for financial aid. "It can give families an advantage," she says. "Do I think that's equitable or right? No. But I can certainly understand why some families do it."
Bloomberg Business Week . Do Consultants Ease Financial Aid Angst? By Alison Damast February 03, 2008
The formula everyone should know. This is the basic formula all colleges use when calculating financial aid eligibility:
COA - SAI = Need - Resources = Mod. Need
In Andrew’s case, we were able to shift the initial EFC from $16,540 to a lower baseline of $11,709.
By combining this shift with a strategic college selection strategy, we recovered an additional $4,831 per year in gift aid from Vanderbilt.
*Names changed due to disclosure of confidential financial information.
Andrew - Studying Computer Science & Economics
SAT 1350
Applied to 7 colleges.
$86,200 Adjusted Gross Income
Initial EFC 16,540 | Final EFC $11,709
Accepted to all 7 colleges. Vanderbilt among accepted colleges. COA $66,871
Received $55,056 in Grants and Scholarships
New COA of $11,711
Total of $220,224 saved over four years
The EFC is not always an indication of what a family will pay. In some instances the EFC is an indicator of the kind of aid you are eligible for.
In Melinda’a case, our FAFSA strategy helped us recover $27,000 per year in merit aid at Augustana College.
*Names changed due to disclosure of confidential financial information.
Melinda - Studying Economics & Law
ACT 32
Applied to 9 colleges.
$405,000 Adjusted Gross Income
Initial EFC $167,249 | Final EFC $112,862
Accepted to all 9 colleges. Augustana among accepted colleges. COA $52,707
Augustana College offered $27,000 per year in gift aid
New COA of $52,707 down to $25,707
Total $102,808 saved over 4 years.
The Deal with Student Aid Index (SAI)
1. SAI is not necessarily an indication of what you will pay. It simply tells you the category of money that you may be eligible.
2. SAI is driven off a combination of income and reportable assets.
3. SAI is a guideline only. Colleges can choose to calculate financial and merit aid eligibility based on their own internal formulas and guidelines.
Given the number of families we work with each year we come across interesting “twin studies” that give us tremendous insights into how colleges award merit aid. Below is the case of Patrick and Aaron, two students applying to the same college in the same year. Both students have similar family incomes and academics.
*Names changed due to disclosure of confidential financial information.
Patrick - Studying Computer Science - 3.9 GPA / ACT 32
$112,337 Adjusted Gross Income
Greater than $100,000 in countable assets
Final EFC $160,008
Result:
Santa Clara University - $63,648 Cost of Attendance
$700 Merit Award
$62,948 True Cost
Aaron - Studying Computer Science . 3.8 GPA / 31 ACT
$103,911 Adjusted Gross Income
Greater than $30,000 in countable assets
Final EFC $18,358
Result:
Santa Clara University - $63,648 Cost of Attendance
$47,112 in Merit Awards and Grants
$11,059 True Cost
Patrick’s family ultimately subscribed to the notion that merit aid was based purely on academics and was only awarded $700 per year at Santa Clara. On paper they could have easily afforded the $62,948 per year required to send him to Santa Clara. The savings, bonds and investments, however, constituted a large portion of their non-qualified retirement funds and his parents could not risk losing a quarter of a million dollars of retirement savings to the college. Patrick ended-up going in-state and had to give up his dream of going to college in the West Coast. They were simply not an attractive target for “financial aid leveraging” to the college.
Down the rabbit hole with Enrollment Management.
To truly understand Enrollment Management and the true depth of how your finances affect college admissions and financial aid, these are articles worth reading:
The Invisible Force Behind College Admissions
Galen Graber has to be impressed by his audience: a swath of the 1,500 top admissions and financial aid officials from 635 different schools who have gathered to set policies that determine which kids get into which college and how much money they'll receive.
Cutting to the chase, Graber, a consultant, launches by taking a poll: How many of you would say that the primary motivation for offering students merit scholarships is to reward academic achievement?
Not a single person raises his or her hand...the tuition pricing at America's universities has evolved into something akin to a discount mattress retailer…”
The Dark Art of Enrollment Management
Funds that once went to students in need are now spent on climbing the rankings.
FAQ
I have seen the merit aid charts published by the colleges. Certain grades and test scores get certain merit scholarships. How could all of this be true.
A few colleges award based on a simple “grid” system but not all colleges do. Some colleges are more flexible with pricing.
But the FAFSA says that certain assets only raise the SAI by certain percentages. What gives?
The FAFSA outlines federal rules for how federal aid is calculated. When colleges award aid from their own pockets, they can create their own rules.
My financial advisor/CPA/admissions counselor/college planner says I can’t get any aid and that I should not file a FAFSA.
They are wrong. Not filing a FAFSA is a dead giveaway that you have too much money.
Can our Student Aid Index (SAI) be changed to get more financial aid.
It depends on your specific situation. The department of education sets clear guidelines on which financial components of your household must be reported, by law, on the FAFSA form. It also outlines which financial components are exempt from reporting. To get more details, we would need to review your situation during one of our Enrollment Pathway Sessions.
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