Do Early Decision Students Get More Aid?

For high school seniors, the early decision game has always represented a calculated risk. Apply early, and you might increase your odds of getting in. But if you apply to any school other than your top choice and are accepted, then you’ve locked yourself out of your dream school.

For students applying for financial aid, the stakes are higher. Because of the timing of aid decisions, students who apply under early decision programs and are accepted could have a better shot at scoring more financial aid.

Not all sources of funding are affected, but in many cases, there is a real financial advantage to picking a school early and sticking with it.

Here’s how financial aid works. On Jan. 1, families can begin filing their Free Application for Federal Student Financial Aid (FAFSA) for the next school year. That form determines a student’s eligibility for federal financial aid, including Stafford loans, work-study programs and Pell grants – all of which are available to qualifying students regardless of when they apply. For most families, this is the first step.

However, many aid packages like state and college grants are finite and often are doled out on a first-come, first-served basis, says Haley Chitty, a spokesman for the National Association of Student Financial Aid Administrators, which represents university financial aid officers. And many college scholarships have deadlines as early as December.

Depending on the university, students who are admitted during early admission could see some financial aid perks. “The early decision kids have the first crack at the money,” says Kalman Chany, the president of New York-based Campus Consultants, which advises college students and their families on financial aid. Those students are often courted by colleges into applying early because of their extraordinary grades or athletic skills, and they can end up with sizable financial aid packages.

There are also drawbacks. When students apply early decision, they’re essentially telling the university that it’s their first choice, so the university can more confidently try to pinpoint the smallest amount of financial aid it will take for the student to attend, says Chany. Also, students can’t compare financial aid packages from several schools because they can apply to only one college under the early decision program.

Whether applying early or along with everyone else, students and their parents should start preparing their case for financial aid before next year. Here are five tips to maximize your financial aid package by keeping time on your side.

Because it’s too soon to present 2009 tax returns or to file the FAFSA, students who apply early decision often have to fill out a separate financial aid form provided by the university and the College Scholarship Service (CSS) through a service called Profile.

The online form requires applicants to report an estimate of household income, their parents’ employment status and whether their parents own their home or rent. To submit a CSS Profile, students pay $25 for one college and $16 for each additional school.

Students who are accepted will receive a preliminary financial aid package with a rough estimate of what they’ll get. In the spring, they’ll have to file the FAFSA, and if the income or assets reported there are higher than the numbers included in the CSS application, they’ll receive less aid from the university.