Paying for College

Tuition and fees, plus room and board are costs of attending college that students pay directly to the university. Merit and need-based scholarships from a college can help pay for direct costs. Direct costs are one part of the total cost of attending college.

Indirect costs include any college expenses that students do not pay to the university. Some universities estimate indirect costs when calculating students’ financial aid, but indirect costs can  include books and supplies, room and board if living off-campus/in Greek housing, transportation, insurance, entertainment, and other personal expenses.

Money awarded to a student by a college for academics, athletics, or other special talents to lower the cost of attendance. Merit scholarships are not need-based and do not need to be repaid.

Money awarded to students based solely on their and their family’s assets and income, not on talents, achievements, or interests. Need-based financial aid programs limit their awards to students who have demonstrated that they have the need for financial assistance based on submission of the FAFSA, CSS Profile, or institutional specific forms, or a combination of these forms. Some need-based awards are grants or scholarships and do not need to be repaid, other forms of need-based aid are loans and must be repaid by the student over time.

Need-aware, or need-sensitive colleges may take a student's ability to pay for college tuition into consideration during the admissions process.

Colleges and universities that do not consider a student’s financial situation when deciding whether to admit them. Some need-blind institutions also pledge to meet full financial need, meaning that regardless of a student’s SAI (Student Aid Index), they will provide financial assistance to cover the direct costs of attending that college.

A number calculated after FAFSA submission that determines a student’s eligibility for certain need-based financial aid programs. Generally, the lower the number, the greater the student’s eligibility for these programs. This number is not the net price, the amount that the student’s family is expected to pay out of pocket for college.

The difference between a college's financial aid award and the student's ability to pay for college, as defined by the college. This unmet need is referred to as the gap. A gap can also occur if a student’s ‘ability to pay,’ as assessed by the university, is inconsistent with the student’s actual ability, or willingness to pay.

A federally-mandated software tool provided on every college’s website that allows a family to calculate its estimated net price at that school. Note that all colleges do not use the same, universal net price calculator, which can complicate making comparisons. Calculators that require students to provide exact financial information and ask questions about the student’s academic performance are the most reliable.

Federal student loan offered to students who file the FAFSA and demonstrate financial need. No interest is accrued on subsidized loans until six months after the student graduates from college, and interest rates are lower than those for unsubsidized Direct Loans. 

Loan interest rates are set by the government each July. 

Federal student loan that all FASFA filers are eligible for regardless of need. Interest on unsubsidized loans begins to accrue immediately, and interest rates are higher than those for subsidized Direct Loans.

Loan interest rates are set by the government each July.