Throughout my years of working with families, one question comes up often:

Will financial aid change if my student moves off campus?

While many colleges require students to live on campus during their first year, it’s very common for students to consider off-campus housing after that. Naturally, this raises concerns about how the change might impact financial aid.

The Short Answer

In most cases:

Need-based financial aid does not significantly change when a student moves off campus

Why? Because colleges include off-campus housing as part of the cost of attendance (COA).

When Financial Aid Can Change

There are a few important exceptions to be aware of:

1. Living at Home

If a student decides to live with family:

• The school will reduce the cost of attendance

• This can lead to lower financial aid eligibility

2. Housing-Specific Grants

Some colleges offer grants tied specifically to:

• On-campus housing

• Residential programs

If a student moves off campus, those funds may be reduced or removed.

Why Location Matters

Where your student goes to school plays a big role.

In high-cost cities (like Boston or New York):

• Off-campus housing may be more expensive than campus housing

• Financial aid is still capped at the school’s cost of attendance

This means:

Even if rent is higher, you cannot borrow beyond the school’s determined cost of attendance.

In lower-cost areas:

• Off-campus living can be a more affordable option

• Families may actually save money

How Financial Aid Is Applied

Once tuition, fees, and housing (if applicable) are covered:

• Any remaining financial aid is issued as a refund to the student

• These funds can be used for:

  • Rent

  • Groceries

  • Utilities

  • Transportation

Important Update (FAFSA Change)

Recent FAFSA updates have removed the question about a student’s housing plans.

This means:

• Schools may not automatically know your student has moved off campus

• Students should proactively notify the school of their change of residence

Final Thoughts

Moving off campus is often a natural next step—and in many cases, it doesn’t negatively impact financial aid the way families fear.

However, the details matter.

Before making a decision, it’s important to:

• Understand how your school calculates the cost of attendance

• Review whether any grants are tied to housing

• Consider the cost of living in your student’s location

Because at the end of the day, this decision isn’t just about where your student lives—
it’s about how it affects what your family ultimately pays.

Julie Gross Lenthe is a college financial aid consultant with over 15 years of experience helping families navigate the college financial aid process, including the intricacies of the FAFSA and the CSS Profile.

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Applying for outside or private scholarships has become a standard part of the college process, right alongside completing the Common Application, FAFSA, and standardized testing.

Families invest significant time and energy into finding these opportunities, hoping to reduce the cost of college. And understandably so, college costs have reached record highs.

But there’s an important (and often overlooked) reality:

Winning a scholarship doesn’t always reduce what you pay.

What Is Scholarship Displacement?

Scholarship displacement, sometimes referred to as the “hidden practice” or the “August surprise”, occurs when a college reduces a student’s financial aid after they receive an outside scholarship.

In most cases, the reduction comes from need-based grants (free money that does not need to be repaid)

Instead of lowering your out-of-pocket cost, the scholarship simply replaces aid you were already receiving. Over the years, I have seen this happen to countless families.

Why Does This Happen?

Colleges often justify this practice using a concept called “overawarding.”

Their reasoning:

• Financial aid cannot exceed the cost of attendance

• Funds should be redistributed to other students with financial need

However, from a family’s perspective, it can feel frustrating—especially when a student has worked hard to earn additional scholarships, only to see their original aid reduced.

The Long-Term Impact (Important)

In some cases, the impact goes beyond just one year.

Colleges may:

• Assume the outside scholarship will be renewed annually

• Adjust future financial aid packages accordingly

This can result in a significant net loss of aid over four years.

Where Is Scholarship Displacement Restricted?

Some states have taken steps to limit or eliminate this practice, particularly at public institutions:

• Maryland (2017): Banned public universities from reducing institutional grant aid

• New Jersey (2021): Passed legislation prohibiting the practice

• California (2022): Passed the Ban on Scholarship Displacement

• Pennsylvania (2022): Passed HB1642 to prevent schools from reducing aid

• Washington (2022): Added protections, especially for state aid recipients

• Minnesota: Has policies in place to protect students

Even in these states, schools may still adjust aid if:

• Total aid exceeds the cost of attendance, or

• Gift aid exceeds the family’s demonstrated financial need

How Can You Avoid Scholarship Displacement?

If your family may qualify for need-based aid, it’s important to be proactive. Scholarship displacement is widely practiced by more than 50% of colleges and universities. Do your research.

1. Research Each School’s Policy

Before applying for outside scholarships, I encourage you to visit the college’s website for information regarding outside scholarships or call the financial aid office directly.

Ask:

“How do outside scholarships impact my financial aid package?”

2. Focus on Schools That Meet 100% of Need

Some colleges commit to meeting 100% of demonstrated financial need—often with generous grant aid and, in some cases, without loans. At these schools, the need for outside scholarships is often reduced or eliminated.

Examples include:

• Kenyon College

• Princeton University

• University of Notre Dame

• University of Richmond

• Vanderbilt University

There are over 60 colleges that follow this model.

3. Consider Timing of Scholarship Funds

If you’ve already earned outside scholarships, contact the scholarship provider to ask if funds can be deferred to future years.

This can help preserve your institutional aid in earlier years.

4. Advocate for a Better Adjustment

If you experience scholarship displacement:

• Contact the financial aid office

• Request that adjustments be made to loans or work-study, rather than reducing your grants

Final Thoughts

Scholarships are meant to reward hard work and help make college more affordable.

But in some cases, the system doesn’t work the way families expect.

Understanding how scholarship displacement works allows you to:

• Ask the right questions

• Choose schools more strategically

• Protect the financial aid you’ve been awarded

Because in this process, it’s not just about how much aid you receive, it’s about how much you actually pay.

Julie Gross Lenthe is a college financial aid consultant with over 15 years of experience helping families navigate the financial aid process, including the complexities of the FAFSA and CSS Profile.

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As high school seniors finalize their college decisions, many parents are left asking the same question:

How are we going to pay for this?

After grants, scholarships, and Federal Direct Student Loans are applied, there is almost always a gap. For most families, loans become part of the equation.

As a college financial aid advisor with over 15 years of experience, I’ve helped families from all financial backgrounds navigate this decision. The good news is that there are options—and understanding the differences can help you choose what’s best for your family.

Parent PLUS Loans vs. Private Student Loans

The two most common ways families cover the remaining cost of college are:

• Federal Parent PLUS Loans

• Private Student Loans

Each has advantages and drawbacks depending on your financial situation.

Federal Parent PLUS Loan

The Federal Parent PLUS Loan (PPL) is often the first option families consider. It is a federal loan designed specifically for parents of undergraduate students and is used to supplement the student’s Federal Direct Loans.

Key Features of Parent PLUS Loans

• Loan is in the parent’s name
  Parents apply through studentaid.gov using their FSA ID

• Credit-based approval
  Designed for families with less-than-perfect credit (approval is not based on income or debt-to-income ratio)

• Fixed interest rate
  Set each May annually
  → Example: 8.94% for the 2025–2026 academic year

• Unsubsidized loan
  Interest begins accruing immediately

• Flexible repayment options

  • Payments can be deferred while the student is in school

  • Interest continues to accrue during deferment

• Federal protections and benefits

  • Eligible for forbearance

  • May qualify for Public Service Loan Forgiveness (PSLF), if requirements are met

• Discharge protections
  Loan is discharged if:

  • The parent borrower passes away

  • The student passes away

• Annual borrowing limits (starting 2026–2027)

  • $20,000 per academic year

  • $65,000 total per student

  • (Families already using Parent PLUS Loans prior to this change will be grandfathered under previous rules.)

• Must reapply each year

• Parent PLUS Loans can not be used for graduate students

Private Student Loans

Private student loans are offered by:

• Banks

• Credit unions

• State-based programs

• Private lenders (e.g., Sallie Mae, College Ave)

These loans can be a strong option for families with excellent credit.

Key Features of Private Loans

• Loan is in the student’s name
  Requires a creditworthy cosigner (typically a parent)

• Application process varies by lender
  May require income and credit documentation

• Variable or fixed interest rates
  Rates depend on:

  • Credit score

  • Cosigner strength

  • Repayment terms

• Rates can range widely (approximately 3% to 15%+)

• Repayment flexibility varies

  • Some offer in-school deferment

  • Lower rates often require payments to start immediately

• Limited borrower protections

  • Forbearance may be available (depends on the lender)

  • Not eligible for federal forgiveness programs

• Discharge policies vary
  Not all lenders discharge loans upon death

• Higher borrowing limits
  Students can borrow up to the full cost of attendance

• Private loans can be applied to graduate students

Parent PLUS vs. Private Loans: How to Decide

Here’s a simple way to think about it:

Parent PLUS Loans may be a better fit if:

• Your credit is average or less-than-perfect

• You want federal protections and flexibility

• You may qualify for loan forgiveness programs

• You prefer predictable fixed rates

Private Loans may be a better fit if:

• You have excellent credit (or a strong cosigner)

• You want to secure a lower interest rate

• You are comfortable with less federal protection

• You can begin repayment immediately to reduce interest costs

Final Thoughts on Student Loans

For most families, loans are a reality—especially as the cost of college continues to rise, often exceeding $100,000 per year. College is a large investment. Do your due diligence.

A few important reminders:

• Borrow only what you need

• You will need to apply for loans each year

• Interest rates may change annually

• After four years, you will have multiple loans with different rates

While consolidation is an option, large loan balances can still result in monthly payments similar to a mortgage.

Choosing the right loan strategy—and the right college—can significantly impact your financial future.

Julie Gross Lenthe is a college financial aid consultant with over 15 years of experience helping families navigate the financial aid process, including the FAFSA and CSS Profile.

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If you’ve received your student’s financial aid award letter, you likely saw Federal Direct Loans listed as part of the package.

These loans are commonly included in financial aid offers and are designed to help families bridge the gap between scholarships, grants, and the remaining cost of college. You should accept Federal Direct Loans only after you have committed to the school.

As a college financial aid advisor for many years, I’ve helped many families navigate this process. The good news is that accepting Federal Direct Loans is straightforward and simple once you know the steps.

What Are Federal Direct Loans?

Federal Direct Loans are:

• Offered to students who complete the FAFSA

• Issued in the student’s name

• Not based on credit (no cosigner required)

• Offered in limited amounts each academic year

There are two types:

Subsidized Federal Direct Loans

• Available to students who demonstrate financial need

• The government pays the interest while the student is enrolled at least half-time

Unsubsidized Federal Direct Loans

• Available to all eligible students

• Interest begins accruing immediately

Important: Loans Must Be Accepted to Be Applied To Your Bill

Unlike grants and scholarships, Federal Direct Loans are not automatically applied to your bill.

Students must actively choose to:

• Accept the full loan

• Accept a partial amount

• Decline the loan entirely

If loans are not accepted, they will not be applied to the student’s account.

Step-by-Step: How to Accept Federal Direct Loans

Step 1: Accept Loans in the Student Portal

Log in to the student’s college portal and navigate to the financial aid section.

• Locate the financial aid award for the correct academic year

• Schools automatically apply grants and scholarships

• You must manually select “accept” or “decline” for:

  • Federal Direct Loans

  • Work-study (if offered)

This step must be completed each academic year

Step 2: Complete Requirements on StudentAid.gov

Next, go to studentaid.gov and log in using the student’s FSA ID.

Students must complete two required steps:

1. Master Promissory Note (MPN)

• This is the loan agreement

• Students will:

  • Provide two references

  • Sign the agreement

This only needs to be completed once

2. Loan Entrance Counseling

• A short online tutorial explaining:

  • Loan terms

  • Repayment expectations

• Takes about 20 minutes to complete

• Students will enter the school they are attending

This also only needs to be completed once

You can find both requirements under the “Grants and Loans” tab in the student’s federal aid dashboard. Once requirements have been met, loan funds will be sent directly to the school on the student’s behalf.

Important Notes About Accepting Federal Loans

• Both undergraduate and graduate students must complete Entrance Counseling and the MPN

• The process is similar, but there are separate options for undergraduate vs. graduate students

• Be sure to select the correct option when completing requirements on studentaid.gov

Final Thoughts on Accepting Federal Direct Loans

Federal Direct Loans are a common and often necessary part of paying for college.

Understanding how to accept them—and what each step requires—can help families avoid delays and ensure funds are applied correctly to the student’s bill in a timely manner.

Take your time, review your options carefully, and only accept what is necessary for your family’s financial situation.

Julie Gross Lenthe is a college financial aid consultant with over 15 years of experience helping families navigate the financial aid process, including the FAFSA and CSS Profile.

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For many families, student loans are part of the college funding equation. With the rising cost of tuition, even students receiving substantial financial aid often need to borrow to cover the gap.

Loans help cover the gap between what a college offers in grants and scholarships and the full cost of attendance. With the astronomical cost of higher education, many students rely on loans to make college possible.

As a college financial aid advisor for over 15 years, I have helped countless families navigate the loan process. Understanding how student loans work can make the financial aid process much less intimidating.

Below is a simple guide to the most common types of student loans available to families.

Federal Student Loans

Most students will see Federal Direct Loans listed on their financial aid award letter. These loans are part of what colleges call “self-help aid”, meaning they must be repaid after graduation, including interest.

Students must submit the FAFSA (Free Application for Federal Student Aid) each year in order to qualify for federal loans.

Federal Direct Loans

Federal Direct Loans are typically the first loans offered to undergraduate students.

Here are the key things families should know.

Fixed Interest Rates

Federal Direct Loans have fixed interest rates set each year in May by the federal government.

Subsidized vs. Unsubsidized Loans

Federal Direct Loans may include two types of loans:

Subsidized Loans

• The government pays the interest while the student is enrolled at least half-time in college.

• Eligibility is based on financial need.

Unsubsidized Loans

• Interest begins accruing as soon as the loan is disbursed.

• These loans are available to all students regardless of financial need.

Many students receive a combination of both.

Federal Direct Loans Are in the Student’s Name

Another important feature is that Federal Direct Loans do not require a co-signer. The loan belongs solely to the student and can be a good way for students to build credit.

Loans Are Disbursed Per Semester

Loan amounts listed on the financial aid award letter are annual, but they are typically disbursed in two installments.

For example:

A $5,500 loan would be disbursed as:

• $2,750 for the fall semester

• $2,750 for the spring semester

These funds are applied directly to the student’s college bill.

Federal Direct Loan Limits for Undergraduate Students

Federal student loans are offered in limited amounts each year.

Dependent Undergraduate Students

Freshman Year

• $5,500 total

• Up to $3,500 may be subsidized

• $2,000 is unsubsidized

Sophomore Year

• $6,500 total

• Up to $4,500 may be subsidized

• $2,000 is unsubsidized

Junior and Senior Years

• $7,500 per year

• Up to $5,500 may be subsidized

• $2,000 is unsubsidized

Independent Undergraduate Students

Independent students receive the same base loan amounts plus an additional $4,000 in unsubsidized loans annually.

Graduate Students

Graduate students can borrow:

• $20,500 per year for graduate programs, with a lifetime limit of up to $100,000.

• $50,000 for professional students, with a lifetime limit of up to $200,000.

Graduate Direct Loans are all unsubsidized.

Accepting or Declining Federal Student Loans

Students are not required to accept federal loans.

They can:

• Accept the full loan

• Accept only the subsidized portion

• Decline the loan entirely

Students can also choose to borrow for one year and decline loans in another year.

How to Accept Federal Direct Loans

Students should not accept loans until they decide which college they will attend.

Typically, loans are first accepted through the student’s financial aid portal on the college website. Each school is different, so you should check with the college for the instructions.

Before funds can be disbursed, students must complete two steps:

Loan Entrance Counseling

A short online tutorial explaining loan responsibilities.

Master Promissory Note (MPN)

The legal agreement for the loan.

Both can be completed at studentaid.gov using the student’s FSA ID.

These steps only need to be completed once.

When Do Federal Student Loans Have to Be Repaid?

Federal Direct Loans must be repaid starting six months after graduation.

This is called the grace period for students to find employment.

Repayment may also begin if the student:

• Drops below half-time enrollment

• Leaves school without graduating

If a student enrolls in graduate school, repayment is typically deferred until after the graduate program ends.

How Federal Student Loans Are Repaid

Once loans are disbursed, the federal government assigns a loan servicer to manage the account.

This responsibility is gradually being transferred to the Treasury Department, but for now, most families will continue paying their assigned loan servicer.

Students can find their servicer by logging into their studentaid.gov portal.

The servicer will handle:

• monthly payments

• repayment plans

• deferment options

Importantly, loan payments are never made to the college itself.

Federal Parent PLUS Loans

For families who need additional funding beyond Federal Direct Loans, the Parent PLUS Loan may be an option.

These loans are designed for parents of undergraduate students.

Key Features of Parent PLUS Loans

• Loans are in the parents’ name, not the student’s.

• Approval is based on creditworthiness, not financial need.

• Loans are not subsidized, meaning interest begins immediately.

Parents apply for these loans at studentaid.gov using their own FSA ID.

Applications are typically available in the late spring or early summer before the school year begins.

Borrowing Limits

Parents may borrow up to $20,000 per academic year or $65,000 over four years per student.

Loans can be borrowed on a per-semester or per-academic-year basis.

Parent PLUS Loan Benefits

Because Parent PLUS Loans are federal loans, they include protections such as:

• deferment options

• forbearance during financial hardship

• potential loan forgiveness programs (when available)

• death discharge protection

Private Student Loans

Private student loans are another way families sometimes cover the remaining cost of college.

These loans are offered by:

• banks

• credit unions

• state programs

Examples include:

• Sallie Mae

• College Ave

• NJ CLASS Loan (for New Jersey residents)

Important Things to Know About Private Loans

Private loans differ from federal loans in several ways.

They require a co-signer.

• Private loans are in the student’s name and require a creditworthy co-signer.

Interest rates vary widely.

• Rates can range anywhere from 3% to 15%, depending on credit and payback terms.

Federal protections are limited.

• Private loans generally do not offer the same borrower protections as federal loans.

Loans are issued annually.

• Like federal loans, private loans must be borrowed each academic year.

Families can borrow the total cost of attendance minus other aid.

• Unlike the Federal Parent PLUS loan, parents can borrow up to the total cost of attendance minus grants, scholarships, and federal loans.

Final Thoughts on Student Loans

For many families, student loans are part of the plan to pay for college.

Understanding the different types of loans can help families make informed financial decisions.

A general rule of thumb:

1. Use Federal Direct Loans first

2. Consider Parent PLUS Loans if additional funding is needed

3. Explore private loans cautiously

Always take time to review your options and understand the long-term impact of borrowing.

Julie Gross Lenthe is a college financial aid consultant with over 15 years of experience helping families navigate the college financial aid process, including the intricacies of the FAFSA and the CSS Profile.

Most colleges release financial aid awards by early April.

Students will receive a financial aid award from every school that has accepted them—as long as all required financial aid documents, including the FAFSA (and the CSS Profile, if required), have been submitted and processed.

One thing families quickly notice is that financial aid packages vary widely from school to school. Because of this, it’s essential to understand how to compare those awards so you can determine the true net cost of each college.

(If you need help interpreting the details of an award letter, I’ve also written a separate guide on how to read financial aid award letters.)

After more than 15 years helping families through the financial aid process, I’ve found that the simplest and most effective way to compare financial aid offers is to create a basic spreadsheet.

The Best Way to Compare Financial Aid Offers

A spreadsheet allows you to clearly see the financial differences between schools.

Keep the spreadsheet simple and focused only on cost information. Including unrelated data, such as campus size or average test scores, can make it harder to evaluate the financial side of the decision.

Your spreadsheet only needs four columns:

1. School Name
   

2. Cost of Attendance (COA)
   

3. Total Grants and Scholarships
   

4. Net Cost

What to Include in the Cost of Attendance

The Cost of Attendance (COA) should include the total annual billable cost of the school, including:

• Tuition
  

• Mandatory fees
  

• Room and board

This information is usually listed on the financial aid award letter or on the college’s website. We do not include indirect costs on the spreadsheet as indirect costs vary greatly depending on the student and the college. Indirect costs are not included on your bill.

Calculating Your Net Cost

Your net cost is the amount your family is responsible for paying after grants and scholarships are applied.

The basic formula looks like this:

Cost of Attendance – Grants and Scholarships = Net Cost

This number allows you to compare schools side-by-side and determine which option is most financially realistic.

Why Loans and Work-Study Should Not Be Included

When calculating your net cost, it’s important not to include loans or work-study.

While helpful to meet college expenses, both are considered self-help aid, meaning they do not actually reduce the cost of college.

Student Loans

Most financial aid packages include federal student loans, but these funds must be repaid with interest. Because of this, they should not be counted as financial aid that lowers the cost.

Federal Work-Study

Some schools include Federal Work-Study as part of the financial aid package. However, students must earn this money through part-time employment, and the funds are paid directly to the student, not applied to tuition bills.

Including loans and work-study in the net cost calculation will yield an inaccurate picture of the true net cost.

Comparing Costs Over Four Years

The spreadsheet you create will reflect costs for the upcoming academic year only.

While families sometimes try to estimate the full four-year cost, it’s important to understand that this is only an estimate as college costs typically increase 2–4% per year.

There are also differences in how financial aid changes over time:

• Merit scholarships usually remain fixed and do not increase with rising tuition.
  

• Need-based grants often increase to meet the rise in tuition if the family’s financial circumstances remain the same.

Families must also submit the FAFSA each year in order to maintain eligibility for federal and need-based financial aid.

Why It’s Important to Complete Financial Aid Applications for Every School

By the time financial aid offers arrive, most students have narrowed their college list to two or three top choices.

However, it is still important to complete the financial aid process with every school on the student’s application list.

There is a strategic reason for this.

Having multiple financial aid offers allows you to compare packages and potentially negotiate with your preferred school.

For example, if three colleges offer significantly more need-based grant aid, leaving your family with a much lower net cost, you may be able to present those offers when requesting a financial aid appeal from your first-choice school.

While colleges are not required to match another school’s offer, they may sometimes increase grant aid to help make the decision easier.

This strategy applies mainly to need-based candidates.

Final Thoughts on Comparing Financial Aid Awards

Comparing financial aid offers can feel overwhelming, but using a simple spreadsheet helps families focus on the most important factor: the true net cost of each school.

By separating grants and scholarships from loans and work-study, you’ll get a clearer picture of what each college will actually cost your family.

And if you receive multiple strong financial aid offers, those awards may also provide valuable leverage when appealing financial aid at your student’s top-choice school.

Julie Gross Lenthe is a college financial aid consultant with over 15 years of experience helping families navigate the financial aid process, including the FAFSA, CSS Profile, financial aid award letters, and appeals.

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Sometimes a family’s financial situation changes after they submit the FAFSA or CSS Profile, and the income reported on those forms no longer reflects their current reality.

When this happens, colleges may be able to adjust the financial aid calculation through a process called Professional Judgment.

This process allows financial aid offices to review special circumstances and potentially recalculate a student’s eligibility for need-based financial aid.

As a college financial aid advisor for more than 15 years, I’ve helped many families navigate this process when their financial situation changes unexpectedly.

Why Professional Judgment Exists

Both the FAFSA and the CSS Profile rely on prior-prior year income.

For example:

• A student graduating from high school in 2026 will have financial aid eligibility determined using 2024 tax returns.

That two-year gap can create challenges for families whose financial circumstances have changed.

Common situations that may justify a Professional Judgment review include:

• Loss of employment
  

• High medical or dental expenses
  

• Death of a parent
  

• Divorce or separation
  

• Change in dependency status
  

• One-time financial events (such as large capital gains)
  

• Loss of benefits or income sources

Unfortunately, families cannot simply change the information on the FAFSA or CSS Profile to reflect a different year.

Instead, they must request Professional Judgment through the college’s financial aid office.

What Is Professional Judgment?

Professional Judgment is a federal regulation that allows financial aid administrators to adjust the financial information used to determine a student’s eligibility for financial aid.

Through this authority, a financial aid officer can:

• Modify FAFSA or CSS Profile data
  

• Recalculate the Student Aid Index (SAI)
  

• Reevaluate eligibility for federal, state, and institutional aid

Each request is reviewed on a case-by-case basis and requires documentation to support the change in financial circumstances.

It’s important to understand that:

• Colleges are not required to approve these requests
  

• The decision is made entirely by the financial aid office
  

• The federal government cannot override the school’s decision

Professional Judgment vs. Financial Aid Appeals

These two terms are often used interchangeably, but they are not the same thing.

Financial Aid Appeal

A financial aid appeal is a request by a family to the college to reconsider the student’s financial aid package due to a change in circumstances.

Professional Judgment

Professional Judgement is the legal authority that allows financial aid administrators to modify the data in the FAFSA and CSS Profile to reflect the change.

In simple terms:

• Families request an appeal
  

• Colleges use Professional Judgment to reevaluate financial aid awards based on current financial information

How to Request Professional Judgment

To begin the process, families must contact the college’s financial aid office and request a financial aid appeal.

The best way to start is usually by email or phone, asking about the school’s appeal procedures.

Most colleges will require:

• A written statement explaining the change
  

• Documentation supporting the request
  

Examples of documentation may include:

• A termination letter from an employer
  

• Medical bills or insurance statements
  

• Divorce or separation documentation
  

• Proof of lost benefits
  

• Updated tax returns

After the appeal is submitted, the request is typically reviewed by a financial aid appeals committee.

If approved, the financial aid office may use Professional Judgment to adjust the FAFSA or CSS Profile information and recalculate the Student Aid Index (SAI).

This updated information is then used to determine eligibility for additional financial aid.

The decision applies only to the academic year in question and is considered final.

When Should You Request Professional Judgment?

Financial circumstances can change quickly, and families can request a Professional Judgment review at any time during the academic year.

However, timing can matter.

For example, if the request involves job loss, many schools will not consider the appeal until the unemployment period has lasted at least 10 weeks.

In general, it’s best to contact the financial aid office as soon as the change occurs so you can understand the school’s specific appeal process.

Keep in mind that documentation will always be required, so saving records such as employer communications, medical bills, or financial statements is essential.

Final Thoughts on Professional Judgment

Professional Judgment can be a valuable tool for families whose financial circumstances change after submitting the FAFSA or CSS Profile.

While approval is never guaranteed, the process gives financial aid offices the flexibility to consider real-life situations that may not be reflected on tax returns from two years ago.

If your family experiences a significant financial change, contacting the financial aid office and asking about the appeal and Professional Judgment process can be an important step toward receiving additional financial aid.

Julie Gross Lenthe is a college financial aid consultant with over 15 years of experience helping families navigate the financial aid process, including the complexities of the FAFSA and the CSS Profile.

As financial aid award letters begin arriving, you may notice an item called Federal Work-Study (FWS) listed on your student’s financial aid package.

This need-based federal program can offer great opportunities for students. I’m a big supporter of the work-study program, but I’m not a fan of how it’s often presented on financial aid award letters.

Many colleges lump Federal Work-Study in with scholarships, grants, and loans, making the total financial aid package appear larger than it actually is.

Here’s the important distinction:

• Scholarships, grants, and loans are applied directly to your tuition bill.
  

• Work-study funds are not.

Instead, students earn the money through part-time employment. Because of this, the award amount listed on the letter can make the financial aid package seem larger than the amount that will actually reduce your college bill.

Let’s break down how the Federal Work-Study program really works.

What Is the Federal Work-Study Program?

Federal Work-Study (FWS) is a need-based financial aid program. The student’s eligibility for this program is determined by the information submitted on the FAFSA.

If a student qualifies, the college may include work-study as part of the financial aid package.

The program is jointly funded by the federal government and participating colleges, which means funding is limited.

Federal Work-Study provides part-time job opportunities for students, typically on campus or with nearby community organizations.

Instead of receiving the funds upfront:

• Students work part-time
  

• They earn wages for hours worked
  

• Paychecks are paid directly to the student

These earnings can then be used for personal expenses, books, or other college costs.

Benefits of the Federal Work-Study Program

Federal Work-Study offers several advantages beyond the paycheck.

Flexible Part-Time Employment

Work-study jobs are designed with students in mind.

Most positions are located on campus or nearby, and supervisors understand that class schedules come first.

This flexibility makes it easier for students to balance academics and employment.

Students Are Paid Directly

Unlike other forms of financial aid, work-study earnings are paid directly to the student rather than applied to the student’s tuition bill.

Students are paid at least the federal minimum wage, though many campuses offer $15 per hour or more, depending on the role.

Valuable Work Experience

Federal Work-Study jobs vary widely and can include positions such as:

• Library assistants
  

• Administrative office staff
  

• Research assistants
  

• Campus dining staff

• Positions related to the student’s major
  

Some roles even provide career-relevant experience and networking opportunities.

While the income may not be large, students can:

• Cover personal expenses
  

• Reduce the financial burden on parents
  

• Build responsibility and accountability

Important Things to Know About Your Federal Work-Study Award

If Federal Work-Study appears on your financial aid award letter, there are several key things families should understand.

You Can Accept or Decline the Offer

Students are not required to accept work-study.

College is already a big adjustment, and some students, especially athletes or those with demanding academic schedules, may not want the additional responsibility of a job.

And that’s perfectly okay.

Students Must Still Apply for Jobs

Being offered work-study does not guarantee employment.

Students must apply for available jobs, interview for positions, and get hired.

Work-study students often receive priority for on-campus jobs, but positions are still competitive.

Contact the Financial Aid Office

If your student plans to accept a work-study position, I strongly recommend that they contact the financial aid office right away.

Each college has its own process for posting jobs and hiring students.

Since the best positions fill quickly, understanding the timeline can make a big difference.

Students usually accept or decline work-study (and loans) through their financial aid portal, but a quick call to the financial aid office can clarify the next steps.

Funding Is Limited

Each college receives a specific allocation of federal funds. Once those funds are exhausted, no additional work-study jobs can be offered for that academic year.

Because of this, if a student declines work-study in their first year, it may not be offered in the future.

Schools typically reserve those funds for students who are interested in the program.

What the Work-Study Award Amount Really Means

When you see Federal Work-Study on a financial aid award letter, you’ll notice a specific dollar amount — typically between $1,000 and $4,000.

This number can be misleading.

That amount does not mean the student receives that money automatically.

Instead, it represents the maximum amount the student can earn through work-study during that academic year.

Many schools list the maximum amount (often $4,000) to make the financial aid package appear larger.

In reality, most students earn between $800 and $1,800 per year through work-study jobs.

Final Thoughts on the Federal Work-Study Program

After many years working as a college financial aid advisor, I’ve seen firsthand how beneficial the Federal Work-Study program can be for students, including for my own daughter.

Beyond the paycheck, work-study helps students develop valuable life skills such as:

• Accountability
  

• Confidence
  

• Time management
  

• Professional networking

It can also be a great way for new students to meet people and feel connected on campus.

That said, work-study isn’t the right choice for everyone. College schedules can already be demanding, and some students simply don’t have the time.

If your student is interested, I strongly advise submitting your FAFSA as soon as possible due to limited funding, and reach out to the school’s financial aid office with any questions. They’re there to help guide you through the process

Navigating financial aid can be confusing for families. If you’d like more clear, insider advice about FAFSA, scholarships, and college costs, subscribe to the newsletter so you don’t miss future guides.

Julie Gross Lenthe is a college financial aid consultant with over 15 years of experience helping families navigate the financial aid process, including the complexities of the FAFSA and CSS Profile.

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Financial aid award letters are arriving, and many families quickly realize that some schools simply don’t offer enough aid to make attendance financially realistic.

This can be frustrating—especially when the school offering the least amount of aid is the one your student most wants to attend.

The good news is that financial aid awards are not always final. Colleges understand that family circumstances can change, and many schools allow families to appeal their financial aid award.

Common situations that justify an appeal include:

• A recent loss of income or employment
  

• Illness or medical expenses
  

• A change in marital status
  

• Significant differences in financial aid offers between colleges

After more than 15 years working in college financial aid, I’ve helped many families successfully navigate this process. Below is a practical guide based on the strategies that work best.

First, it’s important to understand that there are two types of appeals:

1. Need-based financial aid appeals (handled by the financial aid office)
   

2. Merit scholarship appeals (handled by the admissions office)

Each requires a different approach.

Need-Based Financial Aid Appeals

Need-based financial aid appeals are handled through the college’s financial aid office.

If you believe your financial aid award does not reflect your current financial situation, contact the financial aid office by phone or email and request information about their appeal process.

Financial aid calculations typically rely on prior-prior-year income reported on the FAFSA and the CSS Profile, if applicable. As a result, many families experience financial changes that are not reflected in the application(s).

When this happens, families can request what is called Professional Judgment.

Professional Judgment allows the financial aid office to reassess your eligibility using updated financial information.

Some schools assign a specific financial aid officer to your student’s account, while others simply have staff members respond to inquiries. Either way, you will usually be asked to complete a financial aid appeal form specific to that college.

Common Reasons for a Financial Aid Appeal

Every school has its own policies, but many colleges consider appeals based on the following circumstances:

Changes in Income or Employment

• Job loss
  

• Reduction in hours
  

• Career change

Changes in Family Circumstances

• Divorce or separation
  

• Death of a spouse

Significant Medical Expenses

• Major illness
  

• High out-of-pocket healthcare costs

Family Financial Obligations

• Elder care expenses
  

• Multiple children enrolled in college simultaneously

Extraordinary Events

• Natural disasters
  

• Unexpected financial hardship

Tax Return Irregularities

Some tax returns include one-time financial events that distort a family’s true income level, such as:

• Retirement account withdrawals
  

• Capital gains
  

• Severance packages

Better Financial Aid Offers from Other Colleges

If multiple schools offer a significantly lower net cost, some colleges may reconsider your award.

Not every college considers all of these reasons valid, which is why it’s important to review each school’s appeal policy carefully.

Documents You May Need for a Financial Aid Appeal

Colleges require documentation to support your request.

Common examples include:

• Most recent tax return
  

• Letter confirming job loss or employment change
  

• Documentation of separation or divorce
  

• Medical bills
  

• Proof of enrollment for multiple children in college
  

• Financial aid award letters from other colleges
  

Colleges cannot adjust aid without documentation, so gathering these materials early can help speed up the process.

How to Write a Financial Aid Appeal Letter

Your appeal statement should be clear, respectful, and concise.

One of the most important elements is gratitude. Start by thanking the school for the financial aid they have already offered.

Then explain your situation using specific financial details rather than emotional language.

For example:

Instead of saying:

Our income has gone down significantly.

Say:

Our household income decreased by 40% in the past year due to a job loss.

Other examples:

• Out-of-pocket medical expenses exceeded $15,000 last year
  

• Another college’s financial aid offer leaves our family with a net cost of $20,000 lower
  

Numbers help financial aid offices determine whether additional grant aid is possible.

Finally, include a clear request.

Example:

We respectfully ask that the financial aid office reconsider our award and determine whether additional grant aid may be available.

Some families also include a specific amount, though this is optional.

Always remember: colleges are not obligated to increase financial aid, so maintaining a respectful and appreciative tone is essential.

When Is the Best Time to Appeal Your Financial Aid Award?

Timing matters when appealing financial aid.

The best time to begin the appeal process is after you receive all financial aid award letters from the colleges your student applied to.

There are several reasons for this:

You Need a Baseline

You cannot determine whether a school improved your offer if you appeal before receiving your original award.

Comparison Offers Can Strengthen Your Case

If several colleges provide significantly better financial aid packages, that information can support your appeal.

Documentation Will Be Required

If your income has changed, you will need to provide your most recent tax return or other financial records to substantiate the change.

I also recommend saving documentation such as:

• Medical bills
  

• Employer communications
  

• Financial records related to income changes

Finally, if possible, avoid committing to a school before the appeal process is complete. Once a student commits, the family loses some negotiating leverage.

Merit Scholarship Appeals

Merit scholarships are handled by the college’s admissions office, not the financial aid office.

These scholarships are often used by colleges to attract high-achieving students, and they may be awarded:

• Independent of need-based aid
  

• In addition to need-based grants
  

However, it’s important to know that not all colleges offer merit scholarships.

Many highly selective schools, including Ivy League institutions, only provide need-based financial aid.

When to Appeal a Merit Scholarship

If a student has achieved new accomplishments since submitting their application, they should contact the admissions office.

These updates may include:

• National Merit recognition or other awards
  

• Improved SAT or ACT scores
  

• Higher GPA after additional coursework
  

• Leadership roles such as team captain or club president

These updates demonstrate continued achievement and help schools see the value the student will bring to campus.

What Not to Do in a Merit Appeal

Unlike need-based financial aid appeals, it is generally not advisable to compare scholarship offers from other colleges.

Admissions offices often view these comparisons negatively and may simply suggest that the student attend the other institution.

Students who do not qualify for need-based aid should also avoid framing the appeal around financial hardship, as they will likely be redirected to the financial aid office.

When Merit Scholarships Sometimes Increase

Colleges often reassess scholarship offers in the late spring, once they begin to understand their enrollment numbers.

This can be a strategic time for students to send an update to admissions highlighting new accomplishments.

Final Thoughts on Appealing Financial Aid

Whether you are appealing for need-based aid or merit scholarships, remember that professionalism and gratitude go a long way.

Be respectful, provide documentation, and clearly explain your situation.

Most importantly, emphasize why your student is excited to attend the school and contribute to the campus community.

Julie Gross Lenthe is a college financial aid consultant with over 15 years of experience helping families navigate the financial aid process, including the complexities of the FAFSA and CSS Profile.

Receiving a college acceptance letter is exciting! We love acceptance letters! Soon after, the financial aid award letter arrives, which can be equally as important. While this letter outlines the financial aid a college is offering, it can also be confusing and difficult to interpret.

Many families struggle with how to read a financial aid award letter, especially because colleges present their aid packages in different formats. Grants, scholarships, loans, and work-study are often listed together, which can be deceiving, making it difficult to determine the true cost of attending a school.

Understanding how to read and compare financial aid award letters can help students make informed decisions, avoid unnecessary debt, and choose the college that is the best financial fit. This guide explains how to evaluate a financial aid package and calculate the real cost of college.

What Is a Financial Aid Award Letter?

A financial aid award letter is an official document from a college, found on the student’s applicant portal, that explains the financial assistance a student is eligible to receive for the upcoming academic year.

Students receive these letters after they are admitted and after their financial aid application(s), the Free Application for Federal Student Aid (FAFSA), and if required, the CSS Profile, have been processed.

Although each school may use its own format, most contain the same key information:

• The cost of attendance

• Types of financial aid offered

• The remaining amount that students and families may need to pay

I want to help you interpret these sections so you can understand what you are being offered and easily compare college costs across multiple schools.

Step 1: Understand the Cost of Attendance

The first section details the Cost of Attendance (COA). This represents the college’s estimate of the total cost for one academic year.

The cost of attendance is divided into two categories: direct and indirect costs. Direct costs include billable items such as:

• Tuition and mandatory fees

• Housing and meals (room and board)

Indirect costs are items that will not be on your bill, but they are real costs. They will vary by school and by student, but they are important to consider. The school will offer estimates to help families budget. Indirect costs include:

• Books and supplies

• Transportation

• Personal expenses

When learning how to calculate the cost of college, the cost of attendance provides the starting point before financial aid is applied.

Step 2: Identify Grants and Scholarships First

The next step is to identify grants and scholarships. These are often referred to as gift aid because they do not need to be repaid. We love gift aid!

Common examples include:

• Federal Pell Grants

• State grants

• Institutional need-based grants from the college

• Merit scholarships

Gift aid directly reduces the cost of attending a college. Grants and scholarships are deducted directly from your bill per semester. When reviewing a financial aid award letter, start by adding together all grants and scholarships.

This total represents the amount of financial aid that actually lowers the price of college without creating debt.

Most scholarships are renewable for four years and include a GPA contingency to maintain eligibility. Need-based grants do not include a GPA contingency; however, students must maintain at least half-time status to continue receiving the grant. Need-based grants must be applied for each year by submitting the FAFSA and, if applicable, the CSS Profile.

Step 3: Understand Student Loans in the Financial Aid Package

Most financial aid packages include federal student loans. Loans are considered self-help aid. These loans are offered in limited amounts, and they must be repaid after graduation. Federal loans offer a fixed rate that resets every year in May.

The two most common federal loans included in financial aid award letters are:

Direct Subsidized Loans

These loans are available to students with financial need. The federal government pays the interest while the student is enrolled at least half-time.

Direct Unsubsidized Loans

These loans are available to most students regardless of financial need. Interest begins accruing as soon as the loan is disbursed.

Students are not required to accept all loans offered in a financial aid award letter. They can choose to accept a smaller amount or decline the loans entirely. If accepted, loan funds are applied directly to the student’s bill each semester.

I have written another article that explains the loan amounts and how to accept them. Please subscribe to stay informed.

Step 4: Review Federal Work-Study Carefully

Some financial aid award letters include Federal Work-Study, a program that allows students to earn money through part-time jobs on or near campus. This is also considered self-help aid.

Unlike gift aid and loans, work-study funds are not applied directly to the student’s bill. Instead, students earn wages as they work during the semester.

Because work-study depends on finding and maintaining a job, it should not be considered guaranteed money for paying tuition. However, it can help cover personal expenses and reduce the need for additional loans.

Federal work-study is a wonderful program, and I am a huge fan, but it can be deceiving on financial aid award letters.

Step 5: Calculate the Net Cost of College

One of the most important steps in understanding financial aid award letters is calculating the net cost of college.

A simple formula can help:

Cost of Attendance – Grants and Scholarships = Net Cost

Some colleges include self-help aid in their “total aid” figure. This can make the financial aid offer appear larger than it actually is.

To understand the true price of a college, families should focus only on gift aid when calculating net cost.

Step 6: Compare Financial Aid Offers From Multiple Colleges

Before committing to a college, it is important to compare financial aid awards carefully.

When evaluating offers, focus on the net cost rather than the amount of aid offered. A college may offer a large scholarship, but the school’s cost of attendance may be very high. Create a spreadsheet and calculate the net cost for each school. This is a great tool that will make it easier to compare schools side by side.

Questions to Ask the Financial Aid Office

If any part of a financial aid package is unclear, students should contact the college’s financial aid office.

Helpful questions may include:

• Are the scholarships renewable each year?

• What GPA is required to maintain merit scholarships?

• Can the financial aid package change in future years?

• What is the best way to secure employment for the Federal Work-Study?

Financial aid professionals can help families better understand the award letter and plan for college costs.

Final Thoughts

Learning how to read a financial aid award letter is an essential step in the college decision process. While award letters may look complicated, breaking them down into key sections—cost of attendance, gift aid, loans, and work-study—makes them easier to understand.

By focusing on grants and scholarships, calculating the net cost of college, and carefully comparing financial aid offers, students and families can make thoughtful decisions about how to pay for college.

Julie Gross Lenthe is a college financial aid consultant with over 15 years of experience helping families navigate the college financial aid process, including the intricacies of the FAFSA and the CSS Profile.

For most families, the college financial aid process feels overwhelming.

Between the FAFSA, the CSS Profile, financial aid award letters, scholarships, loans, and appeals, it can be difficult to know where to start—or how to make the best financial decisions for your student’s future.

Over the past 15 years working in college financial aid, I’ve had the privilege of helping many families navigate the financial aid process. I’ve seen firsthand how confusing it can be and how small pieces of information can make a significant difference in the final cost of college.

That’s why I created this newsletter.

My goal is simple: to help families better understand how financial aid works and how to make informed decisions about paying for college.

Through this newsletter, I’ll be sharing practical guidance on topics such as:

• Strategies families can use to reduce the true cost of college

• Navigating the FAFSA and CSS Profile

• What families should know about student loans

• How to understand different types of financial aid

• When and how to appeal a financial aid award

• How to handle a significant change in circumstances

• How to read and understand financial aid award letters

These articles are designed to explain complex financial aid topics in simple, practical terms so families can approach the process with greater confidence.

Paying for college is one of the largest financial decisions many families will make. Having clear, accurate information can make that decision much easier.

If this topic matters to you, I invite you to subscribe and follow along as I share insights from my experience in college financial aid.

I’m looking forward to helping more families navigate this journey.

Julie Gross Lenthe

College Financial Consultants