How to Negotiate a Financial Aid Package

Given the climbing college price tag, a financial aid package or scholarship offer can be the deal-maker (or deal-breaker) for a student when deciding on a school.

But if your child’s top pick didn’t award enough financial aid, consider doing this: Ask for more money.

The U.S. Department of Education awards more than $120 billion in grants, work-study funds and loans each year to help some 13 million students pay for undergraduate expenses. A school’s financial aid office uses the information on your child’s application and FAFSA (Free Application for Federal Student Aid) to estimate eligibility for aid. But if you believe the financial aid package offered won’t be sufficient to cover costs, you can appeal.

Now that the FAFSA can be filed as early as October 1, allowing colleges to send out financial aid award letters sooner, you have more time to make your case before the May 1st national deadline for tuition deposits.

Act fast — and maximize your chances of success with these four tips.

"Provide a specific — and reasonable — number for the school to re-consider."

1. ASK FOR A SPECIFIC NUMBER

   Provide a specific — and reasonable — number for the school to re-consider. If you tell a school that an extra $2,000 or $5,000 in gift aid would make the difference in your child enrolling at their school over another, it gives the financial aid committee a better understanding of your need.

   So do the math. Sit down and determine the net cost for each school on your list — that’s the total price of attendance (including tuition, room and board, books, food, transportation) minus scholarships and grants. Then calculate what your family can contribute and compare it with each financial aid award letter. The gap between those two will be the magic number to aim for.

2. PUT YOUR APPEAL IN WRITING

   Showing up to the financial aid office to make an in-person appeal won’t help your child’s case. For one thing, the person you make initial contact with in the office probably doesn’t have the power to change your offer. And even if they do, they’re not going to do it on the spot.

   Instead, brush up on the school’s appeals protocol, usually called a professional judgment, so you know what the financial aid office requires to initiate a review. Some schools list guidance about appeals procedures on their websites. If you can’t find it online, call the school for instructions. Most will require families to fill out a form and attach a cover letter with documentation.

   Ready to take the next step? A financial advisor can show you how all the pieces of your financial plan fit together.

   An appeal usually falls under one of two categories: need-based or merit-based. The former looks at special financial circumstances that your child’s FAFSA may not already reflect. This can include unforeseen medical bills, the loss of a parent’s job or a reduction in income, extra expenses for elderly parent care and divorce or separation. If your family incurred costs from a natural disaster, that could also qualify you for further need-based financial aid.

   On the other hand, you may wish to make a merit-based appeal if your child’s academic record (i.e., their grades and/or test scores) has dramatically improved since application season. You might also make this type of appeal if a similarly ranked school offered more in merit scholarships or grants. In that case, go back to your top choice and use the better award as leverage to ask for additional money. In your appeal, tell the school you’ll enroll if they can match the offer from their competitor.

3. PROVIDE EVIDENCE — FOR EVERYTHING

   Be as detailed and thorough as possible. For need-based aid appeals, offer up every fact, date and figure that pertains to your current financial situation, and provide supporting documentation to justify any claims of hardship. That includes things like receipts, medical bills, official termination letters, bank statements and so on.

   When negotiating for additional merit-based aid, attach copies of award letters from competing schools to show the college the cost they are up against, and how much is needed to close the gap. You should also include proof of improved test scores and grades, and any letters of recommendation. All of this can move your student further up in the peer competition rank, making him or her a more attractive candidate.

   One thing to note is that many Ivy League institutions do not offer merit scholarships. However, some, like Cornell, may try to match more favorable need-based financial aid packages from other Ivies.

4. DRIVE HOME YOUR COMMITMENT

   Communicate to the school that it is your student’s top choice. Make it known that just a little bit of extra aid can turn the tide in the decision to enroll. Also, thank the school for the package they’ve put together. Explain to them you’re willing to take on your responsibility, based on what you can realistically budget and what you can take on in loans.

   Most of the time when an appeal is approved, it’s a relatively small offer — maybe $2,000 or $3,000 for that year. Colleges don’t have the means to fund every student they’ve accepted. So in other words, don’t ask for the moon.

   Then, mail or email your letters to the appropriate office. Need-based aid appeals are typically directed to the financial aid office. Merit scholarship negotiations usually go to the enrollment or admissions office. If you’re appealing both, send copies of your letter to both offices. If you’re unsure, call the school to verify.

   After a week, follow up with a phone call or make an appointment for an in-person visit. The school will generally try to respond to your appeal before the May 1st enrollment deposit deadline.

Whether or not you get to your magic number the first time around, remember to apply for (and possibly negotiate for more) financial aid every year — what doesn’t work one year might work the next.