You just received four financial aid award letters. Now it’s time to do an analysis of each and decide which one works best for you. Who is willing to give you the most free money and minimize your out-of-pocket costs? Making that decision is a family matter, so make sure you share those letters with your parents! If you’re a dependent student, your parents will probably have to borrow some money to pay for your college education.

Financial aid offices refer to aid awards as financial aid packages. This doesn’t mean they show up in a brown box on your front porch, but it does mean that colleges will try to offer you a combination of aid types, “packaged” together in a mix of grants, scholarships, loans, and perhaps a work-study job — that is, if your aid application met the financial aid deadline! If you missed the deadline date, you may only be awarded a loan or a job. It pays to apply on time!

Here are some critical points to consider when making a financial decision about where you will spend the next four, or maybe five, years:

• Each award letter should state the school’s academic year cost of attendance (COA). Compare the letters side by side. Does the COA include all projected costs? Tuition, fees, room, board, books, transportation, and personal expenses are what normally make up the COA. Does your award letter itemize all these components? Or does it omit some? This is crucial because, for nine months, those are the expenses you will have to budget for.
  
• What is your expected family contribution (EFC)? Is the school’s — not just the federal government’s — EFC listed on the award letter? Some schools may require a higher EFC than you expected. And be aware that the EFC may increase every year, regardless of your parents’ income.
  
• Is there unmet need? Does your award letter clearly state that the school is unable to award your full need? Or does it explain that 100 percent of your need will be met? If that is the case, is most of the money in the form of a loan and a job? In other words, packages may contain enough money to cover your costs, but the money may not be free.
  
• If you are awarded a scholarship based on scholastic achievement or talent, is it renewable for four years? Is there a minimum grade point average you have to maintain? Can you switch majors but keep your scholarship? Look carefully at all the conditions you must meet to keep the scholarship.
  
• What will the college do to your award if you receive outside non-institutional scholarships? Will they reduce your institutional grants or scholarships? Or will they reduce your loan amount or job hours? (This is a good time to compare each school’s policy on this matter.) Remember, aid cannot total more than the cost of attendance.
  
• If your package contains loans, what are the interest rates? Which school offered you more than one loan and why? Do not sign the award letter until you understand your loan obligations. Interest rates on student loans are on the rise and you could end up paying thousands more in interest if you don't choose your loans carefully.
  
• Ask the school if the financial aid package is likely to cover the same expenses every year. In particular, ask if grant or scholarship funds are normally reduced or increased after the freshman year, even if family income remains the same. Some colleges will increase the self-help (loan and job) percentage every year, but not necessarily the free money.
  
• If you are awarded a job to help pay your costs, ask how many hours a week you will be expected to work to earn the amount awarded to you. You may want to request that your awarded job funds be changed to a loan, or, conversely, you may want your loans changed to a job. You must ask immediately because funds are limited.

You can always appeal your award letter if you feel that your needs are not being met or if you have received a better award from a competitive school. Simply ask for a reconsideration of your award, but avoid using the term “negotiate.”