Have you ever had a job or been in a business where acronyms seemed to exist in every email subject line, every report, and every team meeting?  Of course, we all have!  Do you think college planning is any different? Nope!

This article is going to help you get to know the important acronyms.  Here we will do the following:

  • Define key acronyms that you want to know
  • Provide a quick explanation for why they are important
  • Show you where you should look online for these important acronyms (for example: where to complete the FAFSA!)

FAFSA – Free Application for Federal Student Aid

Definition: This four-part form serves as a baseline document across the country to help determine if you are eligible for need-based aid and how much you will be eligible for. The FAFSA uses a four-part formula to determine your EFC (another important acronym, defined later in this article) and it concentrates on these things:

  • Personal information
  • Financial info:
    • Income information
    • Asset information
  • Student information
  • Parent information

Why is the FAFSA so important? To apply for federal student aid, such as federal grants, work-study, and loans, you need to complete the FAFSA. In addition, many states and colleges use your FAFSA information to determine your eligibility for state and school aid. And finally, some private financial aid providers may use your FAFSA information to determine whether you qualify for their aid.

Where to find online:  https://fafsa.ed.gov

CSS Profile – College Scholarship Service Profile

Definition: The CSS profile is a questionnaire that is of a similar type to the FAFSA.  It is a bit more detailed in nature.  It is administered by the College Board and used by 245 schools as part of their financial aid review process.

Why is the CSS Profile so important? Since the CSS is so detailed, and because so many schools participate in the review of your CSS, it has become increasingly important in addition to the FAFSA.  The main difference between the FAFSA and the CSS is the level of detail—the CSS digs deeper.

Where to find online: https://cssprofile.collegeboard.org

EFC – Expected Family Contribution

Definition: This is the amount that colleges think your family should be able to pay each year.  The Cost of Attendance (defined below) minus the Expected Family Contribution is your family’s financial need.

Why is the EFC so important?  Knowing your EFC is a very valuable piece of information.  It allows you to draw a line in the sand to see how much colleges and universities will expect you to come out of pocket each year.

If there is a delta between your EFC and the Cost of Attendance, you could qualify for aid.  This is a valuable data point as you research schools because you can find out (through publicly available information) which schools are better than others at meeting that need for aid.

Where to find online: Your EFC will be calculated from your FAFSA information, but here is a thorough guide on EFC and it’s formula: https://studentaid.ed.gov/sa/sites/default/files/2017-18-efc-formula.pdf

COA – Cost of Attendance

Definition: The cost of attendance (COA) is not the bill that you may get from your college; it is the total amount it will cost you to go to college each year.

From the FAFSA website: “The COA includes tuition and fees; on-campus room and board (or a housing and food allowance for off-campus students); and allowances for books, supplies, transportation, loan fees, and, if applicable, dependent care. It can also include other expenses like an allowance for the rental or purchase of a personal computer, costs related to a disability, or costs for eligible study-abroad programs.”

Why is Cost of Attendance so important? COA is important for two main reasons. First, it is helpful for budgeting and planning to have a pretty accurate marker for all-in costs, because as you might imagine, simply budgeting for tuition doesn’t tell the whole story.  Second, the COA is a key data point for calculating need-based aid eligibility along with the EFC and your FAFSA info.

Where to find online: The best place to find COA information is on the College Board website where you can search and find the COA figures for any individual college.  Part Two of this article series, Utilizing the College Board Website for Research, dives deeper into this topic.

Please enjoy the rest of this article series on How to Utilize Online Resources for College Planning, and if you have questions, please ask!

Author:

Erik Fischer, CFP

This post is Part Three of a seven-part article series entitled How to Utilize Online Resources for College Planning. Part Four will be published next Wednesday, November 6th, 2019. It will explore how to research student loans.

Part 1: How to Research Scholarships

Part 2: Utilizing the College Board Website for Research

 

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