Wednesday, October 28, 2009

Providing Career Guidance - Finding the Balance

How important is it that my child has a career direction before going to college and how can I guide him or her through the career search process? This is a question many parents of high school students ponder. The topic was thoughtfully addressed by journalist Eilene Zimmerman in the New York Times Career Couch column which appeared on October 25, 2009: “Helping Teenagers Find Their Dreams.” You can access it at I share Zimmerman’s belief that there is too much pressure on kids today to define themselves by a career before acquiring the tools to choose wisely and prior to gaining exposure to various options that might be right for them.

Students today receive so many messages, both subtle and overt, pressuring them to define their career interests before they are even out of high school. Consider the college application process: The first page on the Common Application is Future Plans! Many colleges want to know intended major as well as possible career or professional plans before they even see the GPA or know where the student graduated from high school! Anxious seniors who were hoping to use the next four years to figure this out come to me in a panic: Is it okay to put “Undecided?” I must confess that I, too, encourage students to put down an academic interest and possible career choice, though emphasize that they should view their college years as a time to broaden horizons and explore new things. The message I try to convey is that it is okay to change one's mind; in fact, it is expected. How can I say otherwise? I am on my third post college career!

In order to help our kids with this self discovery and career search, we can start by alleviating some of the pressure. Instead of projecting our own angst about their futures onto them, we ought to have conversations which begin to generate ideas, but also engage their interest. Talking about likes, dislikes, talents and strengths generally elicits far more enthusiasm and willingness to talk than Mr. Bradshaw’s put-off line in The Graduate: “Ben, what are you doing…? Be open, and try to listen rather than feel compelled to offer up answers.

Here are 5 tips you might consider the next time you find yourself engaged in a career discussion with your teen:

1) Help your child discover skills and interests rather than advise him or her to focus exclusively on career options – skills are transferable; careers come and go
2) Guide, don’t lead – Teens need to take the initiative. This is all about their dreams, not yours.
3) Take the cues and know when to back off; If your teen does not want to engage in this discussion when you want to, it won’t be productive.
4) Assure your children that uncertainty is okay and let them know that you support the need to explore. After all, they are still teens!
5) Accept that much has probably changed since you last embarked on a career search and recognize your own knowledge shortcomings. The career your teen ultimately chooses may not even exist today!

Saturday, October 17, 2009

ABCs of Financial Aid

COA, FAFSA, EFC…the alphabet of financial terms associated with paying for college can be a source of confusion for families in the thick of the college application process. As with applying to college, navigating financial aid requires assessing the landscape. Familiarization with concepts, knowing deadlines and being organized is the key to finding success in the financial aid process too.

Here is a quick college financing primer highlighting some of the critical terms you will need to know:

The Cost of Attendance, or COA, refers to the total annual cost of college, not just tuition and fees. Don’t forget to factor in room and board, books, transportation, and other personal expenses when trying to estimate what a year of college will cost. College financial aid officers look at the total COA when they package aid awards. Most, if not all colleges, will post the COA on their website.

The Free Application for Federal Student Aid, better known as the FAFSA, is used by colleges and universities to determine eligibility for financial aid. All students must file a FAFSA in order to receive any federal student aid. This includes the non-need based unsubsidized federally guaranteed Stafford student loans, so if you anticipate borrowing for college, don’t forget to file the FAFSA. It becomes available online January 1, 2010 for the 2010-2011 school year at

The Expected Family Contribution or EFC which is calculated from the information you provide on the FAFSA is the amount determined to be what the family can and should contribute to the cost of the student’s education. The EFC is based on the family’s current assets and prior year's income, including both the student’s and parents’ financial data. After completing and submitting your FAFSA, you will receive a Student Aid Report, or SAR, which will show your EFC.

Nearly 600 schools also require that families complete the CSS/Profile form for the allocation of their institutional (non-government) funds. The CSS/Profile is administered by the College Board and can only be filed online. Families can access the Profile as early as October 1, 2009 for the 2010-2011 academic year by going to the College Board’s website:

Now that you are familiar with these terms, there are some additional things that you should know about financial aid awards:

- Your “demonstrated need” (the COA minus your EFC) won’t necessarily be the amount shown on your SAR if the college also uses the CSS/Profile or another financial aid form. These methodologies are not the same, and therefore will produce different results. Institutions allocating their resources will naturally rely on the methodology that sets a lower threshold for your financial requirements, so don’t be surprised if the aid package is less than you expected, even from schools that claim to meet demonstrated need.
- Colleges tailor the CSS/Profile formula to their specific institutional requirements. In other words, your demonstrated need may vary from school to school. For example, some colleges consider the equity in your home; others do not.
- The college offering the most financial aid may not necessarily be providing the best package. One has to look at the composition of each award. A financial aid package that meets need with grants which do not have to be repaid is far more attractive than one comprised entirely of loans.
- If your financial situation changes materially after you’ve filed the forms, such as loss of employment, you should notify the colleges immediately.

Be sure to visit the Financial Aid section of each school’s website to check on requirements, deadlines and merit aid, if awarded. Since financial aid is a limited resource, getting things in early can make a difference. The sooner you complete the FAFSA, CSS/Profile and any other required forms, the better your chances of receiving financial assistance.

Monday, October 5, 2009

FAFSA Revision Redux

In my June 29 post I wrote about forthcoming changes to the FAFSA, the financial aid form that must be completed by students and their families seeking federal aid to pay for college. This also includes anyone who wishes to borrow under the federally guaranteed Stafford loan program, whether for need based or the non-need based loans. The new and improved FAFSA for the 2010-2011 academic year will come online January 1, 2010 and can be accessed at (do not confused this with which is NOT the Department of Education, but rather a site that will charge users for access and services!).

The soon-to-be-released version of the FAFSA should be easier to complete, as it will incorporate help text and instructions for specific questions as well as enhanced skip logic. That means you probably will no longer have to wade through pages of questions that are irrelevant to your circumstances. In addition, families will now be able to populate certain fields with tax return information retrieved directly from the IRS, a feature which will eliminate some 20 questions.

The objective of the FAFSA revision is simplification. So not surprising, one of the most frequently touted benefits to the new form is the ability to access your filed tax return to complete sections of the FAFSA form (a feature that will become available in January to those applying for spring 2010. It will be rolled out to all users later next year). A simple “Click Here” displayed in the income section for both the parents and the student instructs FAFSA to get your federal income tax information directly from the IRS. If you choose to use the IRS access feature you will no longer have to search for and re-calculate income data in order to complete the FAFSA. Much of what you need will come automatically from your filed return.

While this sounds like a vast improvement to a daunting form, the option of using financial information taken directly from the IRS may be a lot of hoopla that will have limited benefits in practice. Here is why.

As I noted in my June post, the information taken off your tax return is dated. If you fill out the FAFSA as soon as it is available on the website (January 1 every year for the school year beginning the following fall) in order to meet schools’ deadlines, you will be accessing a tax return showing income from two years prior. Once you retrieve data from the IRS and use this for your FAFSA, you can neither amend nor update it. The way the FAFSA completion process currently works, most people use income estimates and then update with actual numbers after the relevant tax return is filed. Using your tax data is not recommended for those married, but filing separately since only one tax return can be accessed. If your marital status has changed since your last filed return, you cannot choose this option.

Perhaps the greatest shortcoming to using your filed tax return is the fact that colleges will still want to see current financial data. So in the end you will find yourself gathering this information for the schools anyway. Furthermore, there are nearly 600 colleges and universities that require the CSS/Profile form for the purpose of allocating their institutional resources for student aid. That form has not been revised, so families will still be required to submit all of the financial data they had before.

Bottom line: don’t get too excited about the improvements to the FAFSA form yet. True, the skip logic and enhanced labeling and instructions should reduce the number of questions and some of the confusion. But in the end, most people are not likely to see any measurable reduction in the amount of financial data they are required to provide.