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Does Financial Aid Cover Room and Board in Addition to Tuition and Fees?

Mark Kantrowitz

December 06, 2010

I am currently a senior at a high school. If I want to dorm at a private university, which adds $10,000 more to the $40,000 tuition, do the universities take into account the financial aid as a whole thing with tuition and room and board, or do they just give financial aid for the tuition? To simplify this, my total costs of one year in college would be $50,000, so would they give me financial aid for that money, or would they give me aid just for the tuition? — S.S.

Financial aid is based on the full cost of college, including room and board, not just tuition and fees. But the amount of financial aid is reduced by a measure of your ability to pay, so you are unlikely to get a completely free ride at any college, even if you are very poor. Also, financial aid packages usually include loans, which have to be repaid (with interest).

The amount of financial aid depends on financial need, which is defined as the difference between the cost of attendance and the expected family contribution (EFC). The EFC is a measure of ability to pay based on the family income and assets. It is determined after the student submits the Free Application for Federal Student Aid (FAFSA) and other financial aid application forms. The cost of attendance — sometimes called the student budget — includes tuition and fees, room and board, books and supplies, transportation and personal expenses. The cost of attendance may be adjusted on a case-by-case basis at the discretion of the college’s financial aid administrator to include dependent care costs, disability-related expenses and/or the cost of a computer.

Most colleges have three student budget figures, depending on whether the student lives on campus in a dormitory, at home with his or her parents or off campus in an apartment. If you live on campus in a dormitory, the room and board figure will be based on the actual charges for the dorm room and the required meal plans. If you live off campus in an apartment or with your parents, the student budget will include an allowance determined by the college.

Most colleges base the off-campus room and board figures on a local rent survey, the College Board’s Living Expense Budget or inflationary adjustments to the previous year’s allowance. If your costs are higher, most colleges will not adjust the cost of attendance figures to compensate because student financial aid is not intended to subsidize lifestyle choices. The main exception is when the higher costs are due to accommodations for a disability.

Not every college awards enough financial aid to cover the full demonstrated need of the students. Some colleges practice gapping, where the student is left with some unmet need. This may increase the amount that must be borrowed to pay for college. Among Bachelor’s degree recipients in 2007-08, those who had unmet need in their senior year graduated with about $4,300 more debt than those without any unmet need.

Even when the college meets a student’s full demonstrated financial need, the financial aid package will usually include some student loans. (The main exception is the six dozen elite colleges that have adopted no loans financial aid policies. Students at these “no loans” colleges still borrow to pay for the family’s contribution to college costs, but do graduate with less debt.) While the amount of gift aid increases with increasing college costs, total grants typically represent only about 30 percent of the cost of attendance, even at the more expensive colleges. Debt at graduation correlates very strongly with the cost of attendance and tuition, so you are more likely to graduate with excessive debt at a college with a sticker price of $50,000 or more than at a college that charges half as much.

The colleges you are considering are among the most expensive colleges in the US. You should consider some less expensive colleges, such as an in-state public college or a college located in a less expensive area of the country. It is also a good idea to apply to a “financial aid safety school”, which is a college that will not only accept you, but where you could afford to enroll even if you got no financial aid.


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