Understanding your Financial Aid Award: FAFSA, EFC, COA, SAR, and Other Acronyms

Elmira, NY (03/29/2019) — It's no secret. Financial Aid can be one of the most confusing and complicated aspects of a college search. Between the many acronyms and the differences in college financial aid letters, you may think the entire financial aid process is quite confusing……but it doesn't have to be.

Understanding your financial aid and payment options is an important part of your college search…and I'm here to help you decipher some of the terms that may be listed on a financial aid award letter.

Before you begin to review your financial aid offers, however, take a look at the total cost (tuition, fees, housing, and meals), of each institution. In most cases, there will be a difference in costs so it is important to keep that in mind before looking over your financial aid awards.

So what do these terms mean?

Tuition: in a nutshell, tuition is the instructional cost of attending college. Tuition DOES NOT include non-instructional charges, including room, meals, activities, auxiliary services (like the health center or technology), etc. When comparing different colleges, it is very important to review each institution's tuition before any financial aid is awarded.

Room and Board: these are your housing and meal charges. If you plan to live on campus, you'll be charged for room and board. If you're a commuter but still want to enjoy some meals on campus, you may be able to purchase a commuter meal plan - check with each college you're considering to see if this is an option.

FAFSA: FAFSA stands for Free Application for Federal Student Aid and is the main online form used by colleges and universities to determine your eligibility for federal financial aid. All students should file the FAFSA at fafsa.gov as some colleges require it for non-academic scholarships and grants. You never know what you may qualify for.

EFC: Estimated Family Contribution is calculated after filing your FAFSA. It is NOT, however, the amount of money you and your family will have to pay for college. It is a guide used by colleges to determine the amount of aid you may receive.

SAR: The EFC will be reported to you on your Student Aid Report, known as SAR.

Now that you have a basic understanding, I encourage you to take a deeper dive into financial aid. Pull out your financial aid award(s). Let's walk through one together.

Are there scholarships, awards, and grants listed? These are student aid funds that do not have to be repaid. Scholarships and awards are usually academic- or merit-based or given because you have completed something that's required - for example, visited campus for a "visit award." Grants are often need-based and awarded after receipt of your EFC from the FAFSA. Be careful to check with each college as in most cases there are renewal requirements for each as well.

Loans will be part of a financial aid award letter and are considered financial aid. Loans are borrowed money that must be repaid. While you may be hesitant to have student loans, it is very important to take some responsibility of your college experience…and student loans are an important part of this investment for you. Loans from the federal government typically have lower interest rates than private lenders. There's more information about loans at StudentAid.gov.

You may also qualify for another self-help program called Federal Work Study. This is a program that provides you an opportunity to work on-campus part-time to help you pay for your educational expenses. However, one key thing to keep in mind…you must earn this money and it should not be considered "free money" on your financial aid award. Many students use work study earnings to pay tuition or for extra cash for pizza night or other expenses.

At the end of your financial aid award, you can determine your net cost - an estimate of what you and your family will pay each year to attend college. It's easy to determine your net cost as you take the institution's cost and subtract the amount of financial aid awarded (not including work study, if applicable).

As I mentioned in my first blog post, don't choose the college that is the "cheapest" or "gave you the most scholarship money." Attending the least expensive college can be the worst decision you'll make. Look at the opportunities available at each college. Check out the cost of each college before financial aid and then review the net cost after. Perhaps your best choice is the college that is slightly more expensive!

Hopefully you now have a better understanding of your financial aid award. If not, I highly encourage you to contact an Office of Financial Aid to have an in-person or telephone conversation with a school's financial aid staff. As the old adage states, "there's no such thing as a dumb question." This is particularly true about financial aid. Ask away. You'll be better off in the long run.

Chris Coons
Vice President of Enrollment Management

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