Understanding Financial Aid: Not Easy

I have always wanted to know what it means when UC says that students would not have to pay tuition if their parents made less than $80,000 a year. So I went to the UCLA financial aid estimator, and I punched in a few variables, and here is what I found.

In the case of a family of four with an income of $75,000, here is what we get: Parent Contribution:
$10,860.00;
Estimated Award Letter
Grant Award:
$11,586.00
Self Help Award:
$9,200.00
Family Help Award:
$10,860.00

Estimated Total Price of Attendance
University Fees
+$12,685.00
Room and Board
+$13,980.00
Books and Supplies
+$1,509.00
Transportation
+$789.00
Personal
+$1,368.00
Health Insurance
+$1,225.00
Loan Fees
+$90.00
Total Cost of Attendance:
$31,646.00

So, the first thing you might want to know is what are “Self Help” and “Family Help” awards. I looked all over the web site and several other sites, and I could not find any definition of these categories. I then called the UCLA financial aid office, and after waiting several minutes on hold, I finally got a live voice, but this voice could not answer my questions, and so I was transferred to a supervisor. When I asked him what these terms meant, he said he thinks “self help award” refers to student loans and work-study aid, but he had never heard of a “family help award.” I told him that it is on his web site, but he responded that the federal government is requiring the university to put this information online, but they are not responsible for its content.

I am guessing that the family help award is a loan, but I really don’t know; however, what I do know is that while everyone talks about the high cost of tuition, the biggest driver of costs and student debt is housing and related expenses. It turns out that this issue tracks national data. In 1990-91, total tuition, fees, room and board at public universities averaged $5,585, and in 2009-10, this cost rose to $16,712, which represents an increase of $11,127. Meanwhile for community colleges, the total cost in 1990-91 was $3,467, and in 2009-10, it went to $7,703 for an increase of $3,403. During the same period, average tuition and fees for public universities rose from $2,159 to $8,123 for an increase of $5,964, while for community colleges tuition and fees went from $824 to $2,285 for a total increase of $1,461. This means that the biggest cost increases for public higher education concern room and board, but few people ever discuss this fact.

Next Week I plan to return to my last blog on how to make all public higher education free. I had to take it down because there was an error in my analysis.