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Financial Aid Office: Friend or Foe?

Many parents think that their friendly college financial aid officer will help them qualify for grants, scholarships and other financial aid.

I don’t blame them.  A quick survey of a few websites of popular, competitive colleges turns up language like this:

“We are committed to meeting the diverse needs of the student population.”

“We have a long-standing commitment to need-based financial aid and continually seek new ways to provide access to a [fill in the name of college] education.”

Whew – that’s a lot of “commitment!”

But what are colleges really committed to?

They have things on their mind other than showing you how to pay them less.

Things like “getting behinds in seats.” The world of college college admissions is “wicked” competitive, but not only for applicants.

It’s growing increasingly competitive for COLLEGES too.

That’s why colleges hire personnel like Chief Marketing Officers, who earn between $200,000-$400,000 per year.

That’s why colleges like Northeastern University sent out 200,000 pieces of direct mail last year.  They paid a tidy $15,000 to access the data, then $.70 per name.  Plus printing and postage.

What did that cost, five bucks a head out the door?  Do the math – that’s a cool Millyun.

One more thing:  where did Northeastern get this data?

From the “non-profit” College Board.  How many customers like Northeastern do they have?  200?   500?

How many random colleges have you received mailers from?

This is one of the College Board’s multi-million dollar, “hidden” businesses.

And you thought they were only in the SAT business!

What other expenses take up a modern college’s budget?

Payroll.  Especially for “full-time” professors who teach a whopping two classes per semester – that’s something like eight hours of classroom instruction and a handful of office hours per week.

And paying university presidents hefty salaries – deep six-figure ones, sometimes seven figures (not only the colleges you’ve heard of. The guy from Mountain State (?) made 1.8 Mill two or three years ago.)

Nice work if you can get it.

Ever tour a faculty lounge?  Probably not – most college tours will not venture there because parents might put two and two together (or twenty-five and twenty five…thousand) and think, “So that’s where my tuition checks go.”

Of course the college defends their well-appointed, luxurious faculty lounges on the grounds that they help recruit highly qualified professors.

I’m sure they’re right, but COME ON!!!!

All of these facts help explain why college costs go up in down economies, and go up in good economies.

You can see that they’re certainly not spending it all on student education – the amount of student spending per capita has dropped over the last 15 years.

So if you call up your friendly financial aid officer, who works for an institution that wants your money to pay for these expenses, don’t expect to get too far.

I always compare it to calling the IRS and asking them about any hot new tax loopholes that you can use to avoid paying taxes.

Here’s another fun exercise:  go to the websites of your favorite colleges.  Now, try to figure out the deadlines to file your financial aid forms.  (Hint:  no, it’s not January 1.  Hint Number Two:  if you’re applying Early Decision or Early Action, your financial aid deadline could be weeks, even months earlier!)

How do you beat these colleges at their own game? The best defense is a good offense.  Learn:

  • The rules of the game – how some assets count against you more than others, and some not at all.
  • Where all the legal “loopholes” and deadly “landmines” lurk on the FAFSA (Free Application for Federal Student Aid) and other financial aid forms.
  • How to play competing colleges off against each other.
  • Special advantages for self-employed people.
  • Unique considerations for separated or divorced families.

You could read the financial aid regulations, but they take up more than 1,100 pages, last count.

Or you could check out this new resource, offered (still) at a discount.

Your Correspondent,

Andy Lockwood

P.S.  You’ll see a bunch of valuable bonuses – and discounted pricing – still available, if you’re quick like a bunny!

Andrew Lockwood, J.D.
Lockwood College Consulting
497 South Oyster Bay Road
Plainview, New York 11803

516.882.5464

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Disclaimer (to prove that I went to law school): None of the ideas or strategies in this or any communication should be construed as specific, personal advice. The ideas expressed herein are general in nature, not specific to the reader’s situation. Some of the strategies or tactics may not work as well as the examples referenced herein.  Others may work better than what was described.  Please seek an independent tax or other adviser’s opinion.

About Andy – Andy is an attorney-turned-“late stage” college finance and admissions consultant.  Because of his own horrible experiences with student debt ($100,000 plus between Wesleyan University and St. John’s University Law School, where he was trained to write disclaimers like these!), he dedicated his career to helping other children – and parents, avoid needlessly relying on loans and otherwise overpaying for college.  See his websites for more information.