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College Financial Aid is Great, But Consider This Before You Accept It

A college student stands in front of a Financial Aid Services Office.
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College application season can be incredibly confusing.

It’s way too easy to get lost in the endless application forms and mile-high stacks of paperwork — especially in what’s usually brand new territory for high school seniors.

But of all the things to be blindly feeling your way through (and sort of making up as you go along), money is not one of them.

So when those financial aid offers start rolling in, you’re going to want to know exactly what you’re dealing with.

What You Need to Know About College Financial-Aid Letters

If the thought of interpreting and then actually having to deal with a financial-aid letter from your college of choice makes you feel a little nauseated and more than a little anxious, it’s probably a good idea to brush up on your understanding of the financial-aid process.

According to the folks over at Huffington Post, there are eight things you need to know about those college financial-aid letters — and what the options mean for you.

First, “financial aid” is a term that includes both grants and loans. Grants and scholarships are money that is given to you — money you don’t have to repay — while student loans must be paid back.

If you’re offered “merit aid,” make sure you review the terms of the package, such as whether it renews every year, and weigh the amount of the aid against your total annual costs.

Also, if a school offers you need-based aid, be sure to check the fine print. There’s often more to this type of offer than meets the eye.

Aside from the different types of aid, it’s also important to understand exactly how financial-aid offers work.

Will the amount awarded stay constant all four years? What does the school really mean when it says you’ll be given a “full” award? Will your private scholarships affect the amount of aid the college is willing to give you?

These are all necessary considerations when reviewing your financial-aid packages from the schools you applied to, and it’s important to understand exactly what you’re being offered before you accept or commit to anything.

To learn more about the different types of financial aid and what to know about those college financial-aid letters, check out the rest of the tips at the Huffington Post.

And if all this talk of financial aid has got you stressing out about your FAFSA, here’s a guide to filling it out — along with why it’s super important. (Seriously — don’t skip out on FAFSA!)

Grace Schweizer is a junior writer at The Penny Hoarder.

The Penny Hoarder Promise: We provide accurate, reliable information. Here’s why you can trust us and how we make money.

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