Will Sealy, co-founder and CEO of digital student loan consulting firm Summer, joined Cheddar News to discuss the process to obtain the best financial aid package ahead of a new school year.

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Stretching Your Dollar: Understanding College Financial Aid

Now it's time for stretching your dollar where we give you tangible tips to make the most of your money. And today we're talking about something that's caused headaches for tens of millions across the US. And that's college financial aid. So in these uncertain economic times, many students are basing their college decisions on the cost, associate with each school and the financial aid packages offered. But the actual calculating of the cost is easier said than done. So I'm joined today by will see he's founder and CEO of Summer, which is a digital student loan consulting firm. So will let's talk us through how parents and students should approach financial aid packages. What do they need to know? Yes. It's a great question, I think right now is an exciting time. Thousands and thousands of students and families are finding out about that. They're getting into college. It's an exciting time. But we all know that getting into college also comes with quite a high expense for most Americans. It's the most expensive costs they will experience second to maybe home ownership. So it's important to know exactly what to do when you get to this process. Now, can you break down some of the different types of aid? Like you have scholarships, you have grants, you have loans, you have work study, you have offered. What's the difference? Yeah, there are four main components that every award letter may include some of or all four. So it includes scholarships, grants, work, study and loans. The most important thing for folks to know is what is actually going to be taken off the total price of the school and the cost of attendance versus what actually needs to get paid back. So the biggest mistake that I see folks make is that they look at the loans included in an offer package and they assume that it's actually taking off the price of the school. But the thing is loans do need to be repaid most scholarships and grants, however, do not. And so what we really advise families is to make sure that you're talking to the school, you're asking the right questions. If something is confusing, sometimes schools can play tricks and make it seem that a loan is actually written in a certain way that might not look like a loan, you always want to ask questions and be sure. So scholarships tend to be merit based aid, meaning it's based on your performance, how you know the quality of what you able to achieve in the classroom and then grants tend to be more need based based on your ability to pay for the tuition. And so those are two different things that you definitely want to maximize. But loans you always want to be careful that you are not assuming that it's just taking off the cost for what we call the net price, which is the total cost minus everything after grants and scholarships, the component that does not need to be repaid. Now, you've so many great tips. Do you have any other tips when you're reviewing all these documents that you get that might be helpful when you're thinking about what to accept? Yeah, another tip that I think we find very helpful for families that are navigating this that we always recommend is make sure you get all the costs factored in a lot of schools don't like to include all the costs on the award letter and that may include things like transportation, room and board, the cost of textbooks, anything that you may be, you know, any clothes or food, anything that could be in addition to the tuition itself, you want to be able to factor that in and not just for the year you're there, but over the years that you'll be in school, 1st, 2nd, 3rd and in some cases, 4th, 3rd and 4th years for folks going to four year programs. Now, when you're considering things like textbooks and maybe things that might not consider tuition are those usually covered by scholarships and a lot of these not always. And so that's a great question. You definitely want to check and it's always good to ask when in doubt. I think a lot of families we find get nervous. They, you know, they just got accepted, they've been tip toeing trying to get that offer, getting the, getting the acceptance. And then when you get the award letter, it's tempting to just sort of say, ok, great and accept the reality is that a lot of these award letters are not apples to apples. You may be applying to multiple schools comparing different award letters from different programs. You really want to recognize that different schools do not standardize them. And so unlike the common app, which for a lot of schools has a similar application across a word letters are different. So always ask questions with the Financial Aid office. Ask what does this mean? What does this entail? Does it include the textbooks? Does it include any other expense that you may be debating? And then in turn, get that information and it's always possible to appeal? Folks don't realize, but you can appeal if you have a better package from one school than the other, you can certainly take that to the school. That might be the less good package and say this is something we're seeing from another school. Can you meet it? And that is a way to try to get more from maybe your dream school if they're not offering you what you want? Well, thanks. So much for joining us. That's will see, he's the CEO and co founder of Summer, which is a digital student loan consulting firm. Thanks Michelle.