How to “Negotiate” with Colleges

That said, as the great (yet fake) attorney Vincent Gambini said, you can make a “counter-offer”. In more appropriate terms, you can request a reconsideration, or professional judgment, for an improved financial aid package (i.e. more money). And here’s the best part. Quite often, when done so correctly – you’ll get more. Sometimes quite a lot more. You can see real examples here.

So, should you be appealing your financial aid offer?
Well, that depends (which I know is annoying, but it’s also true). Actually there are many good reasons to appeal a financial aid offer, but first and foremost, you have to determine if the offer you have received is fair (as in, is it consistent with both the school’s stated financial aid policy and it’s historical practice).

The first thing I do when presented with an award letter is calculate how much the student deserves to receive. This way I have a benchmark to compare the award with, instead of merely crying “it’s not fair!” 

How do you calculate a “fair” award?  By applying the financial aid formulas and researching what percentage of financial need the college meets.

The complex financial aid process can be summarized by a simple formula:

Cost of Attendance – Student Aid Index = Financial Need

Cost Of Attendance (COA) refers to the “sticker price”, or how much it costs, in total, to send your child to school for one year. This includes ALL components such as tuition, fees, room and board, books and supplies, and even personal expenses such as travel, health insurance, and so forth. While these personal expenses vary, colleges each come up with a number that they include in their COA.

Student Aid Index (formerly known as Expected Family Contribution) is based on cryptic formulas that loosely determine how much you can afford to pay each year.  It’s derived from filling out the FAFSA and in some cases, the CSS Profile. 

(Most families are unhappy with their SAI because government formulas often have little relevance to a specific family’s financial circumstances.  For example, I recently came across a family with an adjusted gross income of $157,000 and one student in college whose SAI was $53,000, or approximately 1/3 of their income.  There are ways to reduce your SAI, but that takes advanced planning of a year or two.  So the best time to start is when your student is in 10th grade or earlier).

So let’s do some simple math: if the Cost of Attendance is $90,000, and the SAI is $30,000, you will show financial need of $60,000. (COA-SAI = Financial Need).

The next step is to research how much need the college says they’ll meet and how much they have historically met.  All schools discount to some extent. Perhaps your child’s dream school is a relatively generous one and historically meets 90% – in this case $54,000, leaving only $6,000 unmet.

I realize your eyes could be glazing over right now, so I’ll stop with the calculations.

But if you’re still following, we just figured out that a fair award is $54,000. If you receive that amount or more, I would not bother appealing, but it depends on the allocation (grants vs. loans and work study), and it also depends on new information that may have occurred since the time you filed your financial aid application.

We live in uncertain times. A lot has happened in the last 5 months, or when you clicked Submit on your FAFSA and CSS Profile. Perhaps your family has faced some unfortunate upheaval. Raging fires in Los Angeles have destroyed homes and livelihoods; economic conditions have resulted in job losses for some; recent medical issues may have impacted both income and family expenses.

I recently spoke with a father who lost his entire neighborhood to the Pacific Palisades fire in LA. His healthy, six-figure income would otherwise be a disqualifier for financial aid, so he never bothered to apply. But now he’s facing a $99,000 tuition bill from a costly private university. His family is displaced from their home (probably for years). He has a good case.

In another example closer to my home, a father recently left his job  where he worked for several years. He’s making a career change and starting from scratch, with a significant reduction of income expected in the coming year. This could be worth a few (thousand) extra financial aid dollars.

Any unanticipated hardship event can precipitate a favorable financial aid appeal.

Before you call the financial aid office to request an appeal on the phone, be sure to check out the school’s website for instructions on how to appeal. Many colleges have institutionalized the appeal process with websites explaining the steps, and Reconsideration Forms on their site allowing you to highlight specific circumstances. Be sure to follow the school-specific rules, or you’re simply waiting your time. For all colleges, the only way to appeal is to put your case in writing, either by completing said form or by writing a letter to the financial aid office explaining your circumstances. I often suggest copying the admissions person who signed your child’s acceptance letter. Admissions has a vested interest in having your child say ‘yes,’ so keep them in the loop. 

If you are writing a letter, make sure that you are both thankful and positive – tell them how much you appreciate their original offer (even as you are about to ask for more!).  Describe how eager your child is to attend this prestigious school.  Then mention that, as it stands, you are seeking additional aid so that the decision to choose Faber College can be an easier one for your family. If you can demonstrate that you were under-awarded, do so here.

If you have background about your finances or other relevant information that did not show up on the initial financial aid forms, this is the time to explain it.  And don’t be afraid to use emotion to paint a vivid picture for the financial aid officer, who, for the most part, tends to be an actual human being with feelings! 

If you were laid off, describe not only the financial impact but also the pain and suffering that you experienced. If you’re self-employed and your business suffered a downturn, this letter is the place to demonstrate it and make the reader feel that they’re right there with you.

Before you ‘appeal’, you should probably wait until you have received all of your ‘offers’. That way, if you received a more compelling award from a competing university, you can mention it!  Sometimes (not always), you can use it to play one school off the other, particularly if you can honestly say something along the lines of “Your fine college is Charlie’s first choice, but he received $12,000 more in grants from Faber College. If you can come close to matching Faber, he’s coming to your school!”

One cautionary note – don’t bluff!  You’d better be able to prove that you were offered a better award package elsewhere, because you may be requested to produce it.  And finally, make sure you call it an “appeal.”  Never use the word “negotiate” – the theory (still unproven) is that financial aid officers think that word is too transactional so to be safe, stick to the more academic ‘appeal’.

For younger families, or those in 9-11th grade, it’s important to take early action so that you are out in front of the process, leaving less to chance and surprise. That means understanding the financial aid rules, how those rules square with your family’s financial situation, and then make sure your child applies to the right set of colleges where s/he can enjoy the maximum award possible. This last part, or applying to the right schools, should not be overlooked. Getting an early start, or when your child is in 10th grade, can make all the difference down the road both from a financial and college guidance standpoint.

As always, thank you for following our content and allowing us to help support students and their success! If you have questions about financial aid including appeals, or about finding the right college admissions strategy for your child, then let’s schedule some time to chat.