Fact: Scenes from The Exorcist were filmed in a basement on Fordham University’s Rose Hill campus.
This is almost as scary as my Fordham tuition bill.
My parents and I knew what we would be getting into; we had weighed the schools I had been accepted to against one another, considering everything from location to advising, emotional pull to the number of zeros on the inevitable bill. It was a dark and stormy night (just kidding, it was a warm April evening) when I buckled down and sent in my Statement of Intent to Register (SIR) to Fordham University, with the hefty $700, non-refundable deposit – thus initiating the college payments.
What I Had
Let’s start with the cost of attendance: $63,438
Fordham is on a semester schedule, and so is their billing schedule: $63,438 ÷ 2 = $31,719
Deposits: If you school requires one, the tuition deposit is the financial part of signing your contract to the one school you will be attending. It is a down payment on your tuition bill ranging anywhere from $100 to $1,000 depending on the school (Fordham’s tuition deposit was $500). Schools will either fully credit this payment towards your first payment (say, for the first semester or quarter of the upcoming year), or divide up the money between the number of billing periods they have that year (either two bills: one before each semester; or three: one before each quarter).
Rooming deposit: If housing is not required, but you have chosen be in on-campus housing, your school may add an additional deposit (aptly named the “housing deposit”). For me, it was $200 down at Fordham, which was also accounted towards the upcoming housing payment. Other schools may ask for a security deposit, which will be returned to you at the end of the year(1).
Semester bill – tuition deposit – rooming deposit: $31,247 – $500 – $200 = $31,019
Scholarships: University-granted scholarships and grants (henceforth: awards) are awesome. No messy rules, financial borders, exchanging of hands; money from your school will automatically show in your bill as “paid” or otherwise deducted from your bill. However…DON’T FORGET TO ACCEPT YOUR AWARDS! Many schools make your awards accessible through an accepted students portal online, and/or as a snail-mail-“return to the university”-form that comes in the acceptance packet.
Deadlines to accept awards vary, but are typically after the National Reply-By Date (May 1st/SIR Day). It would be horrifying (and has definitely happened) that students SIR to their top choice, and forget to accept their awards. That turns into hundreds to thousands of dollars not deducted from your bill that needs to be paid, and if your award is renewable, adds up over your entire undergraduate education. Always keep in touch with your adviser or office of financial aid.
Annual Loyola Scholarship divided by semester: $8,000 ÷ 2 = $4,000
Annual Tuition Discount divided by semester: $11,800 ÷ 2 = $5,900
Bill – Loyola Scholarship for semester – Tuition Discount for semester: $31,019 – $4,000 – $5,900 = $21,119
External scholarships (including but not exclusive to local, club, charity, business, and family/individual-established scholarships) come in different forms. Some are one-time checks to the student (read: you!) that can be spent in any way (while intended for your education). Others are periodic installments of the award, and a handful as direct payments to your school towards your account. Scholarships can differ in the ways they are distributed, and the scholarship awarder will gladly explain how their grant works! (For more info: “How Scholarships Work” from Cappex.com)
My external scholarships were one-time, in-my-name checks: the great part of this is the freedom to spend the grant in a form other than tuition. I’ve set mine aside to use towards plane tickets to and from school, books (guys, college books are WAY more expensive than you expect), tech and gear, and even food (because, uhm, food).
What I Had Left
So it is mid-June, my student portal is telling me the tuition payment is due early-July, and only a minority of my semester bill is taken care of.
This is where I realized that the school’s sticker price (“Estimated Cost of Attendance” or ECA) is not the bill (Cue ginormous sigh of relief.).
ECA is that big scary number (So. Many. Zeros.) you see in all the college pamphlets, college rankings, and the financial aid portion of your acceptance packet. It typically compromises of tuition and fees, room and board, books and supplies, travel, personal expenses. Categories vary by school: some may split “room and board” to “room” and “dining plan”, and include specific categories such as “parking fees”.
Direct charges is what the school will actually (and, well, directly) bill you for: tuition and fees, and if you are living on-campus, room and board. The rest of the categories are estimates – statistical averages of what the university’s students spend on each area during the school year. They are adjustable: for books, I could browse the options of new, used, and even e-books’ however, being from California and Fordham being in New York, I can estimate the travel and personal spending category to be much higher.
TL;DR: What does this mean? The original number for CoA ($63,438 annually, $31,719 per semester bill) is an estimate.
We’re no longer looking at the bill being $21,119 for the semester. Now we only have to count in the direct charges: here, tuition and fees, and room and board.
“Estimated” bill – non-direct charges (books + travel + personal expenses for semester): $21,119 – ($492 + $476 + $882.50) = $19,268.50
$19,268.50 is how much Fordham is billing me for this semester, having accounted for the deposits and university-granted scholarships.
Payment Options: Payment Plan, Credit, Cash/Check
Now to the nitty-gritty, literal, here’s-the-money-now-take-it part: the billing. Fordham neatly packaged its billing into an online “E-Bill Suite” linked into the online student portal. Once logged in, the student can invite parents and guardians as authorized users on the account, and everyone connected to the account can make, schedule, and view payments and statements.
Payment Plan: A large number of colleges have payment plans. Some are school-managed; some have partnerships with private billing and payment plan companies (such as Tuition Management Systems from Afford.com). Options vary by university and by options within the university (ie: monthly for 10, 11, or 12 months; every 3 months; etc.). The service informs the university of the student’s payment plan and segways between both; all money flows through just the service – student to service, service to college.
- Pros – This option can feel more manageable to families; a “slow and steady” flow to manage money, with little to no interest.
- Cons – Missing payments can add late fees; most programs will have a registration fee to join the program (on top of the school payments).
- Pros – To the school, you’ll have paid off your bill at the time of the bill (while this is on your credit, you/your parents pay it off monthly like any other credit purchase). Keep up with your payments, and you can rack up rewards points if you credit company has it!
- Cons – Considering the high (and unfortunately, rising) college bills, it’s not an option for every budget. Missing a payment leads to lower credit scores, and higher consequential payments (rinse and repeat, rinse and repeat).
Note 1: Many schools will take credit/credit cards for payment, but may add a “convenience fee” for using it. On average, the fee is around 2%-3% of the bill.
Note 2: After deciding a payment plan wasn’t for us, this was looking good! It fit for our budget and financial plan…until further research showed that the state of New York prohibits schools from carrying the aforementioned “convenience fees”, and thus almost all New York universities do not take credit as main form of payment anymore.
Cash/Check: A couple of weeks left until bill day, and we were now between this option and joining the payment plan system.
- Pros – Like ripping off a bandage, the whole bill is taken care of at once (per billing statement: biannually or quarterly). No interest from loans or tuition plans, no credit issues to potentially pop up.
- Cons – Also like ripping off a bandage, it may sting a little (or a lot, depending on the size). As mentioned with the credit option, it is not a route for every budget.
Having analyzed all the options, narrowing it down to payment plan and paying by check, we decided to pay in full by check.
More Forms of Financial Aid
Loans: So maybe I exaggerated a little bit, students aren’t doomed to be forever a-loan. Just for a while. If paying in full is like ripping off a bandage now, loans are like “ripping off an even bigger bandage in the future” as put by Amanda Cross, a junior at University of Central Arkansas(1). A loan in general is a sum of money borrowed at given interest rate. What makes student loans unique is that payments are held off until after you finish your degree. This feature is what leaves interests rates to be much higher than other common loans, anywhere in the range from 3% to 10%.
Federal Loans: Subsidized and Unsubsidized(1)
Absolutely crucial to getting federal aid is the Free Application for Federal Student Aid (FAFSA). Fill this form out as early as possible! The online application annually opens up for the upcoming school year on January 1st, and is free to use and send to as many schools as you are applying to. Deadlines will hover around mid-February or early March. Private colleges and universities may ask you to also submit supplementary information through College Board’s CSS Profile, which is $16 to send to each school.
- Subsidized loans are need-based and a loan amount is offered to you by the university after review of your FAFSA. The set interest rate (the 2012 application season fixed their rate to 3.4%) will not be applied while you are in school, and only accumulates interest after you’re out of school.
- Unsubsidized loans are non-need based, also known as a Stafford loan. Unsubsidized loans designated during the 2012 application season were fixed at 6.8%. Everyone who submits the FAFSA qualifies for an unsubsidized loan, and your university will determine exactly how much can be offered to you.
Both types of federal loans appear on your financial aid or awards letter. I was offered $5,500 in unsubsidized loans, and while I made sure to accept my scholarships, I declined the loan offer.
Private Student Loans: Private banks will offer their own student loans, usually credit based, like these programs from Wells Fargo, Discover, and Chase, to name a few. Most students take out these loans with their parents as cosigners, which helps keep the interest rate low (and makes it easier to get a loan in the first place!). If you or your parents/guardians have accounts with banks or credit unions they have been happy with, check with your accountant or local bank to see their options and talk to them about what, and how much, loans you can take out.
Work Study: (Specifically here, federal work-study.) If you are offered federal work-study, you are provided some sort of job while you’re a student; from doing research in your major’s field, to community-oriented work, or in public-agencies. Work-study is a fantastic way of tightly securing a small income to put towards your degree and gathering that income towards your education expenses. However, your school’s financial aid office will limit your hours to both match your income to the amount granted to you for the program; and keep you sane and healthy between academics and work.
Footnotes: (1) Special thank you to fellow Prospect college writer, Amanda Cross for her insight on these topics!