How to Translate Financial Aid Letters

Don’t be alarmed if the financial aid letter you received in your admissions packet is about as understandable as a Chinese roadmap. Financial aid administrators (FAA’s) speak in their own jargon and think little of throwing around acronyms or blurring costs and expenses, which potentially get lost in translation for the novice FA recipient trying to decipher the bottom line.
To show families what they should watch out for in the letters they receive, both US News & World Report (USNWR) and FinancialAidLetter.com posted financial aid “decoders” on their websites. Using real letters from colleges in different regions of the country, experts parsed out meaning and graded each for clarity and content.

Responding to a financial aid letter from Northeastern University, USNWR graders noted that total costs were underestimated and no indication was given as to whether or not awards were “renewable.” Similarly, the letter from Allegheny College underestimated total costs and provided confusing information relative to the need to repay loans while in school.

Closer to home, American University was also called on the carpet for underestimating total Cost of Attendance by about $1600. On the plus side, readers praised American for informing students that they have the option of declining an offered loan.

But even the experts are confused. In a recent interview with USNWR’s Zach Miners, noted financial aid guru Mark Kantrowitz suggests that many financial aid award letters are not entirely upfront about costs and “apples-to-apples” comparisons among institutions may be complicated by omissions in information provided.

“Schools might not be listing the same set of costs,” Kantrowitz suggested. “Some might just be listing tuition and fees; others might be listing the total cost of attendance, which includes room and board, books, transportation costs, and miscellaneous expenses.”

You’d think there would be some uniformity here or at least the myriad oversight organizations involved in the allocation and administration of financial aid might demand it.

It would be nice to believe that FAA’s operate in their own little worlds of dollars and cents, and they don’t intentionally obfuscate the value of awards. Luckily, most are willing to answer questions and if you have some, don’t hesitate to call or email a college’s financial aid office. It’s better to get the explanations now and not be surprised later.