IvyAchievement’s Financial Guide"> Podcast | Segment-9-Merit-based-Financial-Aid--A-Guide-to-Build-a-Standout-US-College-Application-e18a7sv

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Episode Notes

Episode Title: Segment #9: Merit-based Financial Aid. A Guide to Build a Standout US College Application.

Episode summary introduction: Segment #9 of the 10-Segment Podcast Series to help students in 11th Grade build standout US College Applications. This segment covers the Cost of College, Financial Aid avenues, the Criteria for Financial Aid and Applying for Merit-based Aid. Subscribe for Assignments.

In this segment, Ben Stern leads us through the discussion.

In particular, we discuss the following:

  • The College Cost
  • What is Financial Aid?
  • Criteria for Merit-based Financial Aid
  • The Process, and Available Resources.

Topics discussed in this episode:

  • Introduction to Segment #9 [0:51]
  • Cost of College [2:46]
  • What is Financial Aid? [6:06]
  • Types of Applications [8:17]
  • Aid - “All Coupons” [12:32]
  • Criteria for Financial Aid [15:52]
  • Merit-based Aid Stats [17:55]
  • Financial Aid Process [20:18]
  • Financial Aid Resources [25:45]
  • Call 2 Action - Subscribe for Assignments [30:28]

Our Guests: 

Memorable Quote: “And he [Jeffrey Selingo] explains that financial aid is really another way to say both both merit based and need based aid, … they're both more polite ways of saying tuition discounts or tuition coupons.” Ben Stern.

Episode Transcript: Please visit Episode’s Transcript.

Recommended Podcasts: Segments in this Series.

Calls-to-action:

Episode Transcript

Transcript of the episode’s audio.

Ben Stern  0:14  

There are some places where less than 2% of international students are going to get to finding out how to get any kind of merit based financial aid. And then there are places where 90% or more, get get financial aid. This is in the top, this is the top 100. Well, Rutgers, Rutgers gives a few $10,000 scholarships. That's 0.1% of students are getting financial aid, at SUNY Buffalo 4%, But at Marquette University 94% get financial aid.

Venkat  0:51  [Introduction to  Segment #9]

That is Ben Stern, on Financial Aid prospects at US Universities!

Hello, I am your host, Venkat Raman.

This is the 9th Segment of our 10-Segment Podcast series - A Guide to Build a Standout US College Application.

In this Segment, we dive into the Cost of College in the US and the Financial Aid avenues available to students, especially International Students.

To that end, we will cover the following:

  • Cost of College
  • What is Financial Aid?
  • Criteria for Financial Aid
  • How many get Merit-based Aid?
  • The Process, and
  • Available Resources

To guide us today, we join Ben Stern of IvyAchievement.

Let’s get started.

-----------------------

Venkat Raman  1:50  

So Ben, first of all, let me welcome you to our podcast. Today, we are going to talk a little bit about quite a bit about financial aid, actually college costs and financial aid and I wanted to do it in sort of a primer form so that it's helpful for all the students out there. So you know, basically I thought we could walk down some set of things that a student might be thinking about, and you know how we might be able to provide some guidance through your expertise. So, So I thought, you know, the best place to start is at the top of the whole thing, which is all about college costs and how one ought to sort of factor those in, just to get started. So maybe that's a good place for us to start talking about.

Ben Stern  2:46  [Cost of College]

So, the bill for college in the United States tends to be very high. And it is divided basically into four main four main components.

Ben Stern  3:04  

One is going to be tuition, which is the cost of attendance, the cost of classes.

Ben Stern  3:14  

 you have room housing, which most most colleges, at least most of the top 100 150 colleges require students to be to live on campus. So this is not an optional cost for most colleges.

Ben Stern  3:36  

And then there's meal plans and most colleges also that that require students to live on campus also require a purchase of a meal plan. So that's also not usually an optional

Ben Stern  3:48  

And then there are additional fees, Student Activity fees, things that are tacked on to to the to the bill that are paid directly to the college.

Ben Stern  4:02  

In addition to that, there are additional costs such as books, and indirect costs books and other health care, health insurance and other things that can be several $1,000 per year. The books especially are very expensive. Some students have other alternatives with getting books online, but in general, a books can be several $1,000 a year. So the total cost of attendance even even taking into account. The estimated cost of attendance books are usually underestimated and can be cost can be several $1,000 over what a what a college says it's going to cost to attend.

Venkat Raman  4:46  

A student is applying to 10 colleges and each of those colleges they have to have some idea of what each one is going to cost. So is there is there a simple way for us to just help them sort of figure that out or is that as Simple as just going and researching each website and putting that together?

Ben Stern  5:03  

Sure. So there are, there are databases online US News and World Report, there's some other we have we maintain a database of costs, we try to normalize that colleges can be compared directly directly to each other. So we only report tuition fees, room and board, because the other kinds of fees can vary from school to school, what they report what they what they say, you know, they might, they might say, Oh, $1,000, we budget $1,000 for travel. But, but international students are going to be spending a lot more than $1,000 for travel per year. So we try to we try to have, you know, costs compared directly in a one one school to the other. Generally, we say add five to $10,000 in tuition, fees, room and board plus five to $10,000 should be the the estimation.

Venkat Raman  5:59  

What is financial aid? And what are the types of financial aid available?

Ben Stern  6:06  [What is Financial Aid?]

Sure. So, um, author Jeffrey Selingo, who, I'm not sure if you've, you've talked to him or not, you've heard of him, he has a book called who gets in and why he's been he's been a journalist covering admissions for many years. And he explains that financial aid is really another way to say both both merit based and need based aid, we'll we'll get to that. They're both more polite ways of saying tuition discounts or tuition coupons.

Ben Stern  6:40  

So colleges are very expensive. And they, if they, if they could charge full price for everybody, they would, but they really can't. So what they do is they subsidize the most colleges subsidize the cost of education for the for some students with the with with revenues from other students, and wealthy from wealthier families. And then they offer discounts for, for either for for two kinds of for two classes, students, basically students that are lower income that they want to have as part of their college population, or that are higher high performing academically, that will do well in college and raise the raise the profile of the college.

Ben Stern  7:27  

So there are there are two main kinds of financial aid, merit based which is on the ostensibly given on the basis of academic merit, or sometimes, sometimes athletic merit, but merit based scholarships. And then there is what's called need based, which is gives given on the basis of a family's financial need. Now, both of these are essentially discounts on the on the cost of education.

Venkat Raman  7:58  

Now, now, does one apply to each one of these things adjust at a high level, and then we can get into it later in detail, but it's a merit based, something that the college figures out that you're eligible for, and they do it on their own? Or is it something that a student would apply?

Ben Stern  8:17  [Types of Applications]

Sure, so merit based aid, there are different different kinds of merit based aid. Some are automatically, some are automatically awarded by a university, when a student applies as accepted. They they take a look at a university, they take it they take a look at an applicant. They say, what do you what do we think we'll have to offer this applicant? What other kinds of schools do you think really think this applicant is going to be weighing weighing us against? What do we have to offer this student to make it worth their while to choose us? That's merit based schools.

Ben Stern  8:54  

Schools that don't need to do that, that know that, that students are likely to choose them over their competitors don't need to offer merit based aid, which is why which is one of the main reasons that the Ivy League colleges for example, do not offer any merit based scholarships. And most top public schools don't offer merit based scholarships. In state or at least certainly not out of state they're not offering merit based scholarships, tuition discounts to to students who are not in within those states.

Ben Stern  9:30  

So merit based scholarships. So some, some are automatically awarded because they they will they basically give a discount to make it more attractive, versus an Ivy League for example, which which doesn't offer financial aid, which doesn't offer any kind of merit based aid. So the Penn State University might or records University might offer $10,000 and so that the cost difference between between the University of Pennsylvania and Pennsylvania State University which is a which is a public school, They might have, the costumes might be $30,000 a year. And that might be worth it to a family who's considering paying for University of Pennsylvania. So they may we're going to try to offer a discount, but they'll still make money on that, they'll still they'll still make money from that student, they just won't, won't have as big a profit margin. That's how that's how it works.

Ben Stern  10:26  

There are other kinds of merit based scholarships that one applies for some are general Some are general to that require additional essays, and require additional address additional transcripts, recommendations. That will be they'll be weighed and and then students will be sort of shortlisted and selected for those kinds of merit based scholarships. Some schools have those. So usually in Southern California, Boston University, Vanderbilt University, University, Wisconsin Madison, several other schools have those kinds of merit based scholarships that are specifically specifically applied to they generally have deadlines that are earlier than the regular deadlines of the universities to give the schools extra time to consider them and shortlist students.

And those are competitive merit based scholarships. And those are they're they're designed to give the to give the admissions office and financially committees more, you know more information about what students that are going to be giving their their financial aid budget to. So that's another that's another category of of scholarships that students can apply for.

Ben Stern  11:48  

Need based awards always require an application, and that the standard for American citizens is called the FAFSA, the Free Application for Federal Student Aid. But that is not used by non US citizens. Instead, most schools that give financial aid, accept what's called the CSS Profile, which is the the College Board, the College Board administers that. There are some other forms, some colleges have their own forums. So those require a separate application. Generally, those applications for financial aid are due a week or two after the the application of the college itself.

Venkat Raman  12:32  [Aid - “All Coupons”]

You know, also hear the term grants or, you know, something of that nature, what are those things in addition to financial aid and scholarships?

Ben Stern  12:42  

Sure, so sometimes, there it's essentially the same thing as a, as a scholarship, are you talking about grants from university itself, or grants from external, external organization?

Venkat Raman  12:54  

I want to talk about both because I, you know, it's just, you know, thrown around by people, and it's not clear. So maybe if we could just walk down what those are.

Ben Stern  13:04  

So there are different, they're different ways, for different accounting purposes, for marketing purposes. ways that financial aid, especially as so called merit based aid is, is couched different terms. So it might be called, it might be called a scholarship, it might be called a grant, it might be called a bursary. It might be called the student fund, it might be called the trustees scholarship, it might be there are a lot of different kinds of different names, they're basically just coupons. Okay, if you go to a store, you have, you know, $10 off $10 off a tea kettle, or, you know, or five $5 off a toaster. or, or, or 20% off a tennis racket, that it's a coupon. It's a coupon that they might have a fancy name for it, you know, the Dean's Dean's fellows scholarship, you know, but it's a coupon.

Venkat Raman  14:02  

Yeah, that's what matters at the end of the day, what, what they have to pay,

Ben Stern  14:06  

it's not how much it's not how much you're going to get. It's not how much money you get, it's how much money you're paying at the end of the day. It's it's important. So when when families asked me, you know, parent, parents last meal, we want something with a, you know, we're looking for 50% discount, if 50% scholarship. But what does that mean? Is it 50% of $80,000? Is it 50% of $50,000. So that's a you know, that's because 50% of a 50% discount on an $80,000 it's still gonna leave you with $40,000. Whereas you don't need a 50% discount to to bring down the cost of attendance for a school that's 50 $55,000 to that budget. So thinking of in terms of percentage is not the is not the best way to compare schools or to think about the cost of attendance you want to you want to think about Okay, how much is it going to cost me In August, before, you know what I have to write that check or have to make that wire transfer.

Venkat Raman  15:05  

Right, right. So So yeah, I think I think I think that's the key point to make is that it's what you have to pay that matters. So all the other things are just means to get it down to a affordable number.

Ben Stern  15:19  

Right? It's it's, it can be confusing with merit based need based, you know, financially, all these all these terms, scholarships. But at the end of the day, it's what what's the sticker price? What's the, you know, what's the cost of attendance? What's the bill going to say?

Venkat Raman  15:35  

Yeah, what's the size of that check?

Venkat Raman  15:41  

Let's talk a little bit about what, what kind of criteria colleges use for financial aid, the ones that they give out.

Ben Stern  15:52  [Criteria for Financial Aid]

Colleges who are looking for, looking for good students, students are going to do well in their college, there's there's no exceptions. Now they're looking for top students, and the better students who are applying, the more likely they are to get those kind of scholarship offers, because those are the kinds of students that colleges want to want to accept.

So a good way to know if you're going to get, you're likely to get offers for financial aid for these kinds of merit based scholarships is to compare to compare to the academics and test scores, especially to two other students in the past in almost all colleges report their the percentiles of their, of their enrolled classes for their SAT and a ACT scores. Now this year becomes a little more, it's become more complicated last year became more complicated, because a lot of schools were test optional. And indeed, students who got merit based financial aid are generally the ones who applied with score. So students straight out students who are applying without test scores or are at a disadvantage this year. For those merit based scholarships. It's not impossible to get, but it is much easier to secure a merit based scholarship. If you have test scores SAT, or ACT.

Venkat Raman  17:15  

Got it.

Ben Stern  17:16  

Even if admission is not necessarily that much different, getting, getting any kind of scholarship is going to be easier with those with this kind of test score. So primarily, primarily for the schools that give merit based aid. They're looking at the academics and test scores.

Ben Stern  17:36  

For the competitive ones, they're looking at more than that they're looking at the essays, they're looking at how, how much a student will bring to the university. What sort of advantages that students will, will confer to the university as a student there.

Venkat Raman  17:55  [Merit-based Aid Stats]

Obviously, they're governed by budgets. So typically, what you know, let's take the top colleges, what fraction of their students end up getting this kind of aid? Or what you might call merit based?

Ben Stern  18:14  

So I can tell you for international students.

Venkat Raman  18:16  

Sure.

Ben Stern  18:17  

I'll give you the figures are international since, I believe most of your listeners are international. Okay. So looking at the aid, colleges that provide only only merit based financial aid not not need based financial aid. So taking a look at that

Ben Stern  18:41  

There are some places where less than 2% of international students are going to get finding out or getting into any kind of merit based financial aid. And then there are places where 90% or more, get, get financial aid. This is in the top isn't the top 100 Well, I will Rutgers, so Rutgers gives a few $10,000 scholarships. That's the 0.1% of students are getting financial aid at SUNY Buffalo 4% but at Marquette University 94% get financial aid. at UMass Amherst, most students 60% of international students get some sort of some sort of scholarship. North Carolina see 15% so it's a it's a pretty big range. Usually it's below 50%. But there are some places Illinois Institute of Technology almost 100% of international students get some sort of some sort, some sort of tuition discount. Okay, so what we what we do is we help students, we help students understand what the actual costs are going to be.

Venkat Raman  19:51  

I thought, if you could just sketch out sort of broadly the financial aid application process, I mean, we can point to the details. But, you know, what are the set of steps broadly that families need to go through? And what do they in general need to provide? What types of stuff do they need to provide?

Ben Stern  20:18  [Financial Aid Process]

There's three general categories. There are documents related to income documents related to assets, and documents related to two loans, The debt.

Ben Stern  20:36  

Income, generally income is different income is listed on some sort of National Tax Return state or national tax return, it can be difficult if you don't file a national tax return. And some countries, there's more complaints than others. And there are different different regulations, and we work through this with with each family that we work with, right. But generally, you all colleges are going to require some sort of national tax return a statement of income and, and what taxes if any, the National taxes that the family owes, maybe it's, if it's one, it's per family, if it's per parent, it really depends on on that country's regulations. But at least one income statement that covers that covers the family's income, that's they'll need that. Also, if the parent has an employer, generally there's some sort of pay stub or a summary of the salary and benefits of the of that have that employee. So generally, that's, that's requested, a lot of a lot of families are self employed, have their own businesses don't have that kind of thing, necessarily. But if they do have that kind of thing that can be that can be very helpful. So those are, those are the two main income related are going to be the government forms, the tax returns, and then employer statements, then that'll really didn't come.

Ben Stern  22:15  

Also, if a if there is investment income, those kinds of statements are going to be are going to be required statements of investment income. So it'll for that will overlap with assets. So any sort of bank statements, portfolio statements, bonds, stocks, real estate, things that are related to assets, those are those are required to be disclosed, basically any assets the family has, now what assets count toward the expected family contribution. Again, that's a that's a podcast, not sure if you will have that with me with somebody else. But that's another discussion, too, to four that varies from school to school, which, in which assets are going to be expected to be contributed to college, but it is required by law by a legally binding contract, when you apply to colleges to disclose all the assets that a family has that that can be, that can be physical, it can be tangible assets, intangible assets, stocks, bonds, real estate, gold, valuables are there, the families are asked to disclose all that Now, not all of that necessarily, has to be is going to be requested to be documented, but it doesn't have to be disclosed. And failure to disclose assets can lead to issues down the line, it can actually be can actually be considered a crime if failure failing to disclose assets on college application can be considered a crime.

Ben Stern  23:56  

Okay. So that so those are those are the forms so along with a lot of the forms, generally some sort of documentation is, is required. And then the application itself doesn't take usually that long to fill out an hour to maybe I work with dozens families every year going through both of the forms and making sure that they're the things are adequately represented. If a financial aid office might ask for more information later on. You know, you don't want to overwhelm them with everything you really want to give them what they asked for. If they asked for more than you can respond to give them more but it's good to have good to have all the financial documentation prepared for that.

Venkat Raman  24:41  

I know you said this before, but international students don't obviously do FAFSA. They do. You know, they just fill out the forms that is school requests or school ones right?

Ben Stern  24:52  

That's right. There's there's different there's different forms that schools have some schools have their own some is called IFSA That they somehow have the use the CSS Profile which costs money to to send some other there's different there are different options different schools have different different options. It can be a little confusing and that's we help students work through we will families work through that they they differ a little bit in you know in the content of the the forms.

Venkat Raman  25:26  

So I was thinking that maybe, as we wind down any specific resources you want to point students to for financial help, of course, your own site, which would like to sort of tell them about but everything else in terms of general resources?

Ben Stern  25:45  [Financial Aid Resources]

Sure. Um, so Well, I would say that a lot of schools have a financial aid, the cost of attendance calculator that it's not, that's not as limited as it is of limited value, it's not have a lot of value to international students. So a lot of families will be wasting their time with these cost of attendance, financial aid calculators that don't really apply to international students. And also don't really bother with that.

Basically, assume you're going to be paying, assume you're going to be paying sticker price. But look at it, look at the data that we have on on financial aid, the it's called the IB achievement, international financial aid guide, admissions advisor, international admissions and financial aid guide, Id chief mint calm. And it's, it's a limited access database, we don't share that database with the we don't make everything public.

So we have a PDF version that's public. And then we have a, a more, a more detailed, sortable, sort of a Google Sheet that's available you can sign up for, that's free. But you have to do have to sign up for but you can get a PDF free of charge that that shows different, you know, financial aid statistics that are available. The school's websites usually have, it will usually have the information about it.

There's no there's no other good really central central database of scholarships available to international students. There's there are scholarships available the list of scholarships for domestic students, for us citizens, but I believe we have the best resource available for scholarships available for for international students.

Venkat Raman  27:36  

Fantastic. Now, so you said that there's a public facing thing that's the PDF and then you have a more detailed, I believe that if a student or family signs up for they can get right?

Ben Stern  27:49  

That's correct.

Venkat Raman  27:50  

OK. Fabulous.

Venkat Raman  27:58

Hi again!

In this Segment we talked about Financial Aid, particularly Merit-based Aid available to students.

We covered:

  • Cost of College
  • What is Financial Aid?
  • Criteria for Financial Aid
  • How many get Merit-based Aid?
  • The Process, and
  • Available Resources

Additional podcasts on Financial Aid including a Step-by-Step Guide are on College Matters. Alma Matters.

Based on this Segment we have an assignment for students in the 11th standard/grade.

Venkat  30:28   [Call to Action - Subscribe for Assignments]

Now, You have to Subscribe to get the assignments.

It’s easy To Subscribe.

Just email to podcast at almamatters.io [podcast@almamatters.io] with the Subject: Assignments.

We will send you an email with instructions on the assignments.

Venkat  44:36

This series is for high school students in their 11th Grade/Standard and who plan to apply to US Colleges at the end of this year.

I want to thank Ben Stern of IvyAchievement for doing the Financial Aid Segment of this series. Do check out IvyAchievement’s Financial Guide.

Transcripts for this podcast and previous podcasts are on almamatters.io forward slash podcasts [almamatters.io/podcasts].

To stay connected with us, Subscribe to Apple Podcasts, Google Podcasts or Spotify or visit anchor.fm forward slash almamatters [anchor.fm/almamatters] to check us out.

Thank you again for listening to this podcast.

Till we meet again, take care and be safe.

Thank you!

Summary Keywords

College Podcast, US Colleges, International Students, College Admissions, College Applications, Financial Aid, FAFSA, Merit-based Aid, Need-based Aid, Financial Aid Process, Financial Aid Resources, IvyAchievement’s Financial Guide


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