General Questions

  • How do colleges determine the percentage of gift aid (financial aid that does not have to be repaid) vs. self-help aid (loans and work-study) that comprises a financial aid award?

    Only a small number of schools nationwide are in a financial position to meet need without loans. Most colleges adhere to a philosophy that students receiving need-based aid should assume some financial responsibility for their education. The vast majority of schools meet need through a combination of gift aid and self-help aid. The percentages of gift aid vs.self-help aid are generally determined by both the financial strength and philosophy of the institution.

  • How will the outside scholarships I receive affect my eligibility for need-based financial aid?

    Wake Forest encourages students to apply for outside scholarships for which they may be eligible. Outside scholarships count as student resources, becoming part of the package of financial aid. When need calculated under the federal methodology (FM need) is greater than the offered aid package, outside scholarships are allowed to meet that difference. Beginning with new students entering in Fall 2014, once the offered aid package equals FM need, any portion of outside scholarship exceeding FM need results in a reduction of need-based student loans and work-study funds. In no case may aid exceed the estimated cost of attendance.

  • Why do financial aid packages differ from institution to institution?

    Not all schools use institutional methodology (IM) to determine eligibility for financial aid. The majority of colleges and universities in this country use only federal methodology (FM). Even within those schools that use IM, there are differences in how institutions use information gathered on the CSS PROFILE. There are also variances in the financial resources that institutions can draw upon when awarding gift aid.

  • Will Wake Forest match financial aid offers received from other institutions?

    Wake Forest awards financial aid based on the information the family and student have provided on the CSS PROFILE and FAFSA. In order to be fair and consistent in this process, we cannot amend awards on the basis of what a student is being offered by another institution. If there are extenuating circumstances that were not reported to Wake Forest but may have resulted in a different financial aid package at another institution, families are encouraged to submit this information in writing to the Office of Student Financial Aid. The Financial Aid Committee will then determine if an adjustment to the package is warranted.

    Wake Forest uses both institutional and federal methodology to determine eligibility for need-based aid. What are the major differences between institutional methodology (IM) and federal methodology (FM)?

    Institutional Methodology (IM):

    • Includes a fuller range of family assets
    • Assumes the student will devote some time each year to earning money
    • Expects the noncustodial parent to assume a fair share of educational costs
    • Includes home equity and family farm equity
    • Includes in total income any paper depreciation, business, rental, or capital losses which artificially reduce adjusted gross income
    • Takes into account medical expenses, private elementary and secondary school tuition, and unusual circumstances.

    Federal Methodology (FM):

    • Ignores both home equity and equity in working family farms
    • Includes only the adjusted gross income reported on federal tax returns, plus various categories of untaxed income
    • Does not assume a minimum student contribution to education from summer earnings
    • Ignores the non-custodial parent in cases of divorce and separation
    • Ignores the assets of families whose income falls below $50,000 and who file a simple tax return
    • Ignores family-owned businesses with 100 or fewer employees

    What assets are taken into consideration in the financial aid process?

    Under IM, the following parental assets are considered:

    • Cash, savings, and checking accounts
    • Investments, including stocks, bonds, savings bonds, mutual funds, trust funds, money market funds, CDs, education IRAs, college savings plans, commodities, precious and strategic metals, installment and land sale contracts, and other investments
    • Assets in siblings’ names, including funds in custodial accounts, Uniform Gifts to Minors accounts, and other savings and investment accounts held in the names of the student’s siblings, who are under 19 and not enrolled in college
    • Assets held in state college savings plans
    • Real estate
    • Home equity
    • Business assets
    • Farm equity

    Under IM, the following student assets are considered:

    • Cash, savings, and checking accounts
    • Investments
    • Real estate
    • Trust funds.

    Under IM, two major allowances–Emergency Reserve Allowance and Cumulative Education Savings Allowance–are subtracted from assets before determining how much of a family’s net worth should be available to pay for college expenses. FM considers many of the same assets but excludes home equity and the equity in working family farms.

  • Is consumer debt taken into consideration when determining a family’s expected contribution?

    No. Although consumer debt poses a legitimate expense for families, it is not taken into consideration in need analysis. In many instances, debt involves discretionary spending. The inclusion of debt would therefore give families who have incurred debt an unfair advantage over those who have chosen to live more modestly.

  • Are retirement assets taken into consideration when determining a family’s expected contribution?

    While the amount of money a family puts into retirement accounts is part of the family’s overall income, assets in designated retirement accounts are not factored into need analysis.

  • Are legal guardians responsible for paying for a student’s education?

    Under institutional methodology, legal guardians who have been appointed by the court may have responsibility to cover the costs of education. Under federal methodology, legal guardians are not responsible for educational expenses.

  • Is the age of the parent taken into consideration in determining eligibility for need-based aid?

    The age of the parent is not taken into consideration under institutional Methodology but is a factor that is considered under federal methodology.

  • What if one or both of my parents refuse to contribute to my education?

    Wake Forest believes parents have primary responsibility to cover the costs of a student’s education to the extent they are able to do so. Financial aid decisions are based on ability, not willingness, to pay, with the greatest help going to families with the highest demonstrated financial need. In fairness to all, we must expect both parents to cover their fair share of educational expenses.

    You may wish to explain to an unwilling parent that we will not share his/her financial information with others. Also, by submitting the necessary financial information, the parent is in no way obligated to contribute to educational costs. The information is simply used to determine eligibility for need-based aid. We cannot increase financial aid because of a parent’s unwillingness to contribute, so a student may be faced with taking out loans to finance the parent’s expected contribution. If there are unusual or extenuating family circumstances, you may submit a written appeal to the Financial Aid Committee.

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