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PEDAR: Executive Summary  How Families of Low- and Middle Income Undergraduates Pay For College: Full-Time Dependent Students in 1999-2000
Paying for College
Financial Need
Financial Aid
Types and Amounts of Aid
Relative Importance of Grants and Loans
Sources of Aid
Remaining (Unmet) Need
After Financial Aid
Work
Help From Parents
Paying for College: A Summary
Research Methodology
References
Full Report (PDF)
Executive Summary (PDF)
 Financial Need

For aid purposes, a student’s financial need is defined as the difference between the price of attending and the expected family contribution (EFC). A student budget, which represents the price of attending the institution selected, is calculated for each student. It takes into account the amounts needed to cover tuition and fees, books and materials, and reasonable living expenses in that area. The amount allocated for living expenses depends on whether the student lives on campus, independently off campus, or with parents or relatives. The EFC is calculated using a formula based primarily on family income and assets (with some adjustments for circumstances such as the number of siblings in college), and is not related to the price of attending. Thus, a student would be expected to contribute the same amount regardless of the institution selected but would have greater financial need at an institution with a high price of attending than at an institution with a low one.

In 1999–2000, average tuition and fees for full-time dependent students ranged from $1,600 at public 2-year institutions to $19,900 at private not-for-profit doctoral and liberal arts institutions, and the average student budget (i.e., price of attending) ranged from $8,600 to $28,800. The average EFC for low-income students (calculated including those with a zero EFC) was between $1,000 and $1,500, but many low-income students (between 31 and 45 percent, depending on the type of institution attended), had a zero EFC. Because EFC depends on the families’ financial circumstances and is not affected by where students enroll, variation across institution types reflects variation in the financial circumstances of the students who chose those types of institutions. Virtually all middle-income students had a positive EFC (at least 99 percent at each type of institution), which averaged between $8,300 and $9,000.

Virtually all low-income students (99 percent or more) had financial need, regardless of where they enrolled. Among those with need, the average amount ranged from $7,400 at public 2-year institutions to $26,000 at private not-for-profit doctoral and liberal arts institutions. The percentage of middle-income students with financial need varied, depending on where they enrolled. At public 2-year institutions, 48 percent of middle-income students had financial need, but at private not-for-profit doctoral and liberal arts institutions, 97 percent had need. The average amount for middle-income students with need ranged from $2,600 at public 2-year institutions to $20,900 at private not-for-profit doctoral and liberal arts institutions.


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National Center for Education Statistics - http://nces.ed.gov
U.S. Department of Education