So, you got accepted into some colleges—woo-hoo! Now it’s time to figure out which college is the right one (and the right price) for you. This is where financial aid award letters come in.
What are financial aid award letters?
If you filed the Free Application for Federal Student Aid (FAFSA) and qualified for financial aid, you’ll receive a financial aid award letter from every school that accepts you and that you listed on your FAFSA.
Like the name suggests, financial aid award letters tell you how much financial aid you can receive and how much one year of college will cost.
Oh, and speaking of names, each college may call their financial aid award letter something different. But whether they’re called financial aid packages, merit letters, or award letters, rest assured that they all serve the same purpose.
When do I get my financial aid award letters?
There’s no hard deadline for sending out financial aid award letters. Because the FAFSA is now available in October, instead of January, some schools have been sending out their award letters sooner—sometimes even right after you receive your acceptance letter. But, some still wait. The number of FAFSA applications a college receives and when you submitted your FAFSA can both affect when a college sends out their letters.
In the off-chance that you haven’t received a financial aid award letter from a college that accepted you and was listed on your FAFSA, reach out to the college’s financial aid office to find out when to expect it.
Will my award letters all include the same information?
Yes! Although your financial aid award letters may all look different, every letter will include information on whether you qualified for gift aid like college scholarships and grants, financial aid like federal student loans, and/or a work-study position.
According to a 2018 report from uAspire and New America, 70% of award letters group all aid together, which means your scholarships, loans, work-study, and grants may not be clearly separated.1 Be sure to read your award letter carefully to identify what type of aid you qualified for.
Scholarships? Grants? Loans? What’s the difference?
The biggest difference is whether you need to pay back the money.
You may hear scholarships and grants called “gift aid” or “free money” because both are financial aid you won’t need to pay back.
You will need to pay back any loans you take out—with interest.
Work-study—which you also may see in your award letters—is a little funky. You won’t need to pay back this money, but you will need to earn it by working at a designated work-study job either on- or off-campus. The money you can earn is also capped at what’s listed in your award letter, so you can’t pick up extra hours for more cash. Oh, and if you don’t work, you won’t get any money—just like at a real job.
Is there an easy way to compare my award letters?
You’ll need to do a little math here, so dust off your calculator or open a spreadsheet.
For each award letter, add up all the financial aid you qualified for, including all scholarships, grants, and loans, then subtract that amount from the college’s cost of attendance. (Hint: If the cost of attendance isn’t listed on your award letter, it’s easy to find with a quick search of the college’s website.)
If you have money left over that you still need to cover, you’ll have to consider another financing option, like taking out a private student loan.
Do I pick the college that gives me the most money?
The answer to this is probably the #1 thing you should take away about financial aid award letters. A school’s cost is important, but it shouldn’t be the only reason you choose a college. You still want to pick a school that matches what you’re looking for. So, as you’re reviewing your award letters, be sure to factor in each school’s location, campus culture, quality of academic programs, and the other qualities that mean a lot to you.
College is a once-in-a-lifetime experience. Let your financial aid award letters be one of a few guides that help you make that exciting final decision and pick your future alma mater.