How to Find the Money to Pay for College

A mechanism has also emerged to overcome one of the major obstacles to studying abroad: its cost. In countries with a private educational system, the fee costs, directly charged to the student, can be considerable, which is one obstacle to exchanges.

Students always experience difficulties when faced with actually making tuition payments has been exacerbated in recent years by a struggling economy. Even as stock portfolios took a big hit, colleges and universities confronted with depressed endowments, rising energy and health insurance costs, and shrinking state support have been sharply jacking up tuition.

In recent years, four out of five U.S. undergrads have attended public universities, and only 8.4 percent have paid $24,000 or more a year in tuition and fees. The upshot is that almost 70 percent of undergrads have paid less than $8,000 in tuition annually.

How colleges figure out what you Need

The often-great differences between financial aid awards are one of the aspects of this process that puzzle and frustrate families the most. Colleges argue that it isn’t such an easy matter to gauge a family’s true need. What’s more, aid officers argue, it’s reasonable to expect families to have saved something for college, and to borrow if necessary, because education is an investment that pays off with much higher future earnings. So colleges make their own, and often quite different, judgments about what families have in the way of resources. Finally, aid officials look at their own school’s “need” (that is, how badly they want you to attend based on your academic accomplishments or other talents) before deciding how much they’ll actually award. Here’s a detailed look at how the process works.

You start with the FAFSA

The first exercise any supplicant must go through is filling out the Department of Education’s Free Application for Federal Student Aid, or the FAFSA. (The electronic form, which flags errors and missing data for you before you submit it, can be found at The government applies a formula called the “federal methodology” to the numbers you supply on the FAFSA to determine your eligibility for a slice of the billions of dollars in federal grants and loans awarded each year. States use the results to award their own state aid, too. Most public universities use the FAFSA to construct your entire aid package, To determine which schools offer the best value, we use a formula that relates a school’s academic quality, as indicated by its U.S. News ranking, to the net cost of attendance for a student who receives the average level of financial aid. The higher the quality of the program and the lower the cost, the better the deal.

But colleges may stray from the standard method and fine-tune the formula even further. Each college has its own customized version of the institutional methodology. Many colleges and universities, for example, don’t let parents deduct the cost of tuition for private elementary or secondary school from their resources, reasoning that private schooling is a matter of personal choice. Other schools may allow a generous deduction. One institution may expect contributions from both parents whether they’re still married or not, while another won’t.