College-bound students: start checking your mailboxes for financial aid award packages

Sallie Mae helps families understand financial aid offers and how to pay for college.

RESTON, Va.—Students who have been accepted to college and have applied for financial assistance will start getting their financial aid award letters in the upcoming weeks. For many families, the arrival of a school’s financial aid award package means it is time to pull out the calculator.

According to the U.S. Department of Education, nearly eight out of 10 full-time undergraduates receive some sort of money for college, with an average of $9,900 per student. With increases in federal student loan limits and hundreds of thousands in grant money, the decision to accept a financial aid award package should be easier than ever. The availability of more free—and cheap—money is great news for students as they look to cover the cost of college next year.

Colleges and universities send financial aid award letters to let students and families know what types of financial assistance they are eligible to receive—and in what amounts—as well as conditions of the award.

The package may include a combination of grants, scholarships, work study and student loans. Financial aid is awarded based on a number of factors, including college costs, availability of funds and family financial information provided on the Free Application for Federal Student Aid (FAFSA).

“All financial aid award packages are not created equal,” said Martha Holler, spokesperson, Sallie Mae. “It’s important to understand how your offers compare and what each means to your pocket book before you make your decision.”

Sallie Mae’s CollegeAnswer.com, the most comprehensive online “going-to-college” resource, offers an Online Award Analyzer to help families evaluate financial award packages side-by-side. To use the Online Award Analyzer and to estimate monthly student loan payments after graduation, go to www.CollegeAnswer.com/Award. Students and their parents can read up on understanding financial aid award letters at www.SallieMae.com/AwardLetters.

Students and families should respond promptly to the award letter and in advance of their school’s deadline, and be sure to read the letter carefully and follow instructions. They may need to complete additional paperwork, such as loan applications.

When reviewing financial aid awards, Sallie Mae advises students and parents to use the following 1-2-3 approach to paying for college:

1.
Find free money first. When tax-advantaged 529 savings plans (such as www.Upromise.com) and interest-free tuition payment plans (such as www.TuitionPay.com) are not enough to cover the full cost of a college, apply for financial aid that does not have to be repaid, such as grants, scholarships and work-study, by completing the FAFSA.
2.
Consider federal student loans. Consider borrowing under the federally subsidized student loan programs, which provide consumer-friendly loan rates, benefits, and repayment options for students and parents. Parents and graduate/professional students can borrow up to the cost of attendance under the Parent PLUS and Graduate PLUS programs, respectively.
3.
Use private student loans to fill any remaining funding gap.

For more information contact:
Erica Eriksdotter (703) 984-5628