How to Navigate Need-Based Financial Aid

In this introduction to need-based financial aid, you will learn about the necessary terms, forms, and tools that you need to know about to pay for college.
Need-based financial aid includes financial support, including grants, scholarships, federal work-study, and student loans.

A father raised his hand in the back of the room–”what’s a FAFSA?”
I was giving one of my first admissions information sessions as a brand new admissions officer at Kenyon College. I had spent the previous weeks memorizing countless facts about Kenyon and its admissions process. Luckily, I also went through a “financial aid bootcamp” with the Kenyon financial aid office and carefully walked the parent through the FAFSA or Free Application for Federal Student Aid in the financial aid process.
Over the next few weeks of talking to prospective students and parents it became clear that need-based financial aid was a big topic of interest.
On one level this is not surprising, the cost of college and student loan debt are hot button issues in the media. It is not uncommon for students who are looking at private colleges in particular to have serious sticker shock after seeing the overall cost of attendance. No doubt financial aid can be confusing and paying for college is stressful. Let’s go through everything you need to know to make navigating financial aid as seamless as possible.


Grants can include institutional awards given by the actual colleges and also Pell Grants that are provided by the federal government to low income undergraduate students. Need-based grants are desirable because students do not need to pay them back.
Some colleges and private organizations may also award scholarships that aim to support students with demonstrated financial need.
[ RELATED READING: Top 6 Tips to Win College Scholarships ]

Federal Work-Study is a program that provides students with part-time jobs to pay for educational expenses. This program is specifically designed to support students with demonstrated financial need. Students should know that they are still required to secure your job through work-study (your college or university should be able to help you find potential options). Students who do not qualify for work-study are also able to find part time jobs on campus (or off campus). This can be a great way to earn some additional money to pay for your college education!

Once a student exhausts grants, scholarships, and work study, the next best option for paying for college is student loans. Student loans get a bad reputation, but can be an effective way to pay for college if used properly.
First and foremost, students should be taking advantage of student loans offered by the federal government before turning to other student loans. The reason for this is simple: federal student loans generally have more favorable terms, interest rates, and repayment options than private student loans.
Additionally, some students with demonstrated financial need may qualify for subsidized loans, which means that the federal government will pay your interest while you are in school. This is great, because many loans require students to pay back all of their interest so while you are in school, your interest will accumulate.

This is an important question. Demonstrated financial need is determined by the Expected Family Contribution or EFC, which is a measure of how much your family can afford to pay and specific to each college. Each family’s EFC is calculated by different data points including income and savings. 

If you think about all of this like an equation, it would look like this:

EFC + Demonstrated Financial Need = Cost of Attendance 

It should be noted that all of these numbers are going to vary from college to college. Which brings us to our next topic…

Each college or university has its own Net Price Calculator (NPC) that will estimate financial aid according to personal financial information. This is great because it will show you the real cost of attendance as opposed to the sticker price. 
The best place to find the Net Price Calculator is on the individual website of each college or university. The NPC on each  individual college website is going to be the most accurate.
Three other things to keep in mind when thinking about the Net Price Calculator:

1. The NPC is only as good as data that is put into the NPC, so if mistakes are made when inputting data, the results could be inaccurate.
2. The financial aid determined by the Net Price Calculator is only an estimate and your actual financial aid package could be different. Generally, the NPC (with accurate data) should be correct within a few thousand dollars, but students will have to wait for their official financial aid package. 
3. The Net Price Calculator only will calculate an estimated need-based financial aid package. This means that you may qualify for even more financial aid if you win a merit scholarship! 

While the Net Price Calculator will provide you with an estimate of need-based financial aid, you will still need to apply for need-based financial aid. This process really depends on the college as every college has its own process, deadlines, and requirements.
Generally though, most students will complete the Free Application for Federal Student Aid or FAFSA as part of their need-based financial aid application process. The FAFSA is required by most colleges and universities and is necessary for qualifying for financial aid from the federal government. Another common form that you may come across is the CSS Profile, which is offered through the College Board. The CSS Profile is required at many private colleges and universities and captures a broader set of data than the FAFSA.
Read more here in our Ultimate Guide to FAFSA.
Of course, if you have any specific questions about financial aid at a particular college, your best bet is going to be contacting the office of financial aid. Financial aid officers can be fantastic resources for you during this process as they know the ins and outs of paying for college at their respective college.
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