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West: That college may not be out of your range
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West: That college may not be out of your range

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Try this quiz on your college-bound teen, the one in the family who knows everything.

What are the most expensive and least expensive colleges in Virginia? The answer is Washington and Lee and Washington and Lee.

How can that be? The answer lies in understanding the difference between the sticker price of college, which gets all the attention, and the net price, which is what you actually pay. Net price is the sticker price minus grants and scholarships.

Colleges must now have net price calculators on their websites. Schools have varying priorities when it comes to awarding financial aid. The calculators help translate those priorities into meaningful numbers for your family. With a few tips, you can use the calculators to discover much more about financial aid.

First, a few basics. Most financial aid is either need-based or merit-based. Need-based aid is a function of your family's finances, both income and assets. All calculators must include need-based aid; some will also include merit aid.

Merit aid is largely determined by academics, skills, talents and activities. It is often given by private colleges and is not based on a family's finances.

We ran calculators of 25 Virginia public and private colleges for a sample family of four with $75,000 income and $50,000 in non-retirement assets. Here are four takeaways from our tests.

First, ignore the sticker prices: 21 of 25 schools offered some discount. Half of the schools offered a discount of over 33 percent.

Second, private colleges are not as expensive as you might think, after deducting grants and scholarships. The average private college sticker price was double that of the state schools. But after financial aid, the difference for our sample family was down to $2,500.

Most of the aid from the public colleges was need-based. Most of what came from private colleges was merit-based. The exceptions were Richmond and Washington and Lee, where the large grants were almost exclusively need-based. This reflects the priorities of those schools.

Third, merit aid is available for families with higher incomes, too. We ran a much wealthier version of our sample family through the calculators. Nine of 12 private schools offered merit aid ranging from $11,000 to $17,000.

Fourth, your teen does not need to be at the head of her class to get merit aid. Grades matter, but you don't have to be class valedictorian. Our sample student had a 3.3 GPA and scored 1080 on the SAT.

The best way to increase merit aid is to apply to schools that are a good academic fit. A sampling of regional college calculators bears that out: Students at the 75th SAT percentile of the freshman class do get more merit aid than those at the 25th percentile.

How much more? It varies by school. Hollins' calculator increased merit aid by over $10,000 for the smarter version of our sample teen. Elon University offered $5,000 more; South Carolina $12,000 more.

Here's a trick: Run the calculators for your teen using different levels of SATs and GPA to see if some academic improvement will have a significant impact on your college costs. You might find a meaningful incentive for more SAT prep.

Four schools offered our sample family no discount at all: GMU, JMU, ODU and Radford. You might be offered some aid from these schools, but our sample family was not.

As with most things in life, there are caveats to the calculators. They provide only estimates. The numbers are for 2011, not 2012 and beyond. If your family's situation is non-typical, the calculator may give inaccurate results. This is especially true for divorced families or those with complicated finances.

There are also common-sense tips. Do not register your name and address along with your financial information. Colleges will ask for it, but that is for their benefit, not yours. Remain anonymous and the results will be the same. Colleges already have the upper hand in the admissions process; don't hand over your financial information at this stage.

Do keep track of your results, even if it's just with a pad of paper and a pencil. Even the biggest math geeks will quickly get lost in numbers if you aren't careful.

Some calculators include loans and work-study in their output. Ignore them. This exercise is about getting more free money, not about loans.

Cost is only one factor in deciding where to go to school, but many families will mistakenly filter out expensive schools early in the process. Don't assume you know what a particular school will cost until you run its calculator.

Back to the quiz: Washington and Lee's sticker price is over $56,000, but for our sample family the net price dropped to $9,185.

Figuring out how to pay for college is not a passive process. Your first step should be to learn an estimate of what the actual cost will be for your family.

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