Students: close your eyes and take a moment to imagine the college experience of your dreams. What do you see?

    • Elegant ivy-covered buildings surrounding an immaculate quad?
    • Spacious dorm rooms and common spaces that are comfortable and maybe a tad luxurious?
    • Gourmet meals served in a dining hall that feels more like a restaurant than a cafeteria?
    • Small, intimate classes with plenty of access to your professors?
    • Cutting-edge technology and equipment for labs and research?
    • A thriving community in a quirky college town or even in the middle of a major city?

It’s a beautiful picture.

What you probably don’t see when you close your eyes, however, is the staggering price tag that comes with the “boutique” college experience. Tuition, dorm fees, meal plans, and general living expenses add up quickly. At selective colleges, the costs are often so high that for many families, affording them simply isn’t viable.

Parents: we’ve seen so many families struggle to have difficult conversations about college affordability. We know that you want to protect your kids and give them the best of everything. But we’ve also seen families suffer unnecessarily to send their 18-year olds to high-priced colleges when, to be honest, a more affordable school on their list might have been an equally good option.

What about financial aid? The term “financial aid” is an all-purpose word when it comes to colleges, but all financial aid is not created equal. It’s important for both students and parents to understand how financial considerations, including financial aid fit into the equation.

There are two main types of financial aid: money that doesn’t need to be repaid (scholarships) and money that does need to be repaid (loans).

Scholarships may be merit-based, which means they’re awarded for specific accomplishments or achievements (achieving a high GPA, playing on a college sports team, excellence in musicianship, etc.).

Scholarships may also be need-based, which means they’re awarded based on the student’s or family’s financial or social circumstances. Some scholarships also specifically support groups who are underrepresented in college attendance.

Loans from the government (federal and state) are primarily need-based, and factors such as credit score do not impact their distribution. However, private loans may be affected by information such as family assess, credit score and other financial factors.

The starting point for financial aid is the FAFSA, or the Free Application for Federal Student Aid (note the application is free, but that doesn’t mean the money awarded is!). Loans have to be repaid eventually, and they accrue interest over time. While many federal loans have fairly low interest rates, the terms vary from loan to loan.

In recent years, graduates have left college with four years of classes, a bachelor’s degree, and a mountain of student debt. For certain professional tracks, repaying this debt is manageable and is a good investment in the student’s education and future. For others, however, the debt is an ongoing financial burden that impacts their quality of life for decades.

It’s important, then, for families to think carefully about what kind of debt they should take on to pay for their college education and experience. School counselors may be able to offer some guidance, but they aren’t trained to provide the financial insights that help families make sound decisions about college affordability.

In a time of economic upheaval, when the unemployment rate is high and the structure of college (online vs. in person? socially distant or business as usual?) is unknown, financial considerations play a more significant role than ever.

We know these are hard conversations to have, but they can be easier if students and parents are committed to discussing their concerns and finding solutions together. As a family, you’re all on the same team, and the decisions you make about college affordability should make sense both now and in the future.

If you need support facilitating a conversation about financial aid, please email us at info@signeteducation.com or call us at 617-714-5262. We can talk through your situation and connect you to additional, trusted resources if needed.