It’s no secret that during these uncertain economic times, colleges are having a more challenging time than ever maintaining balanced operating budgets.  And while the question of whether or not families should apply for need-based financial aid comes up every year, the idea that there may be an “admissions edge” when not applying for financial aid seems to be more relevant than ever.  So, who should check the “Do you intend to pursue need-based financial aid?” box?

Tip #1: Know if the College is “Need-Aware” or “Need-Blind”

Most colleges are “need-aware,” meaning that they consider the student’s ability to pay in their admissions decision.  However, there are roughly 104 colleges in the country that are “need-blind.”  These colleges make their admission decisions independent of a student’s financial need, basing their decision entirely on the quality of the application.  Once a decision is made, they send the accepted student file to the financial aid office, where they are tasked with preparing the best award possible for that student.  The two offices do not talk to each other in making admissions decisions.  The FAFSA is used solely for calculating the aid package and not for making an admission determination.

If the colleges that your child plans to apply to are need-blind, whether or not you seek need-based aid will not help or hurt your child’s admission chances.  But what if a college is need-aware?  Admissions offices primarily make their decisions based on the fit of the student with their institution, as demonstrated by their application.  But when two students are otherwise equally qualified, preference may be given to the student who can pay full price.  Some colleges are very transparent on their website about being need-aware, such as The George Washington University, while a call to the financial aid office will be necessary to determine this for other colleges.

Tip #2: Determine When You Should Apply

If you are unsure as to whether or not it makes sense to apply for need-based aid, consider the following questions:

• Is there any chance that my child will qualify for need-based aid? It’s so important to determine your Expected Family Contribution (EFC) and know how it relates to the cost of attendance at the colleges where your child plans to apply.  If there is any chance that your family may qualify for need-based aid, apply.

• Do any of the colleges on my child’s list require the FAFSA or CSS Profile for merit scholarships? It is unusual for a college to require financial aid filings for merit scholarship consideration, but there are a handful that do. There is no central source for this information, so it is best to check the financial aid websites for each college where your child plans to apply.

• Do we want to take advantage of federal student loans?  A student must file the FAFSA to take advantage of the federal student loan program.  So as not to confuse admissions, a family can leave the “applying for need-based aid” box unchecked and then file the FAFSA at a later date (once the student has decided where they will matriculate) to gain access to loans.  Every college sets a different deadline for this (usually coinciding with the end of the academic year), so check with the financial aid office and make them aware of your plans.
  
  
• Are we comfortable with fully funding four years of college, regardless of a change in income?  If a family does not have sufficient means to pay the full price of college for four years -- particularly when confronted with adverse circumstances such as illness, death, or the loss of a parent’s job -- the FAFSA should be filed to create a baseline financial picture with the financial aid office.  Again, this can be done later in the year, after the student has selected which college they will attend.  If a family experiences a significant financial crisis at a later date, it will be much simpler to go back to the college and document the changed circumstances if the original paperwork is there from the beginning.  

If your child is applying to need-aware schools and you can safely answer “no” to these questions, it may be advantageous not to apply for aid (or at least file the FAFSA at a later date).

Tip #3: Be Truthful

If you intend to file the FAFSA when submitting your college applications, check the box.  Not checking the box, but then filing for aid, will only create confusion for the admissions office.  They may reach out to you to clarify your intent, or they may simply consider you a full-pay family and not award aid.  

When making this decision, please use the financial aid offices as a resource.  They are highly knowledgeable about their school’s specific policies and, in my experience, are more than happy to share their expertise to help you make an informed decision.