1. Education

Financial Aid 101

How to Apply for Need-Based Aid for Private School

By

Financial Aid 101
Scott Olson/Getty Images

According to a recent article in Fox Business, many parents think that a private school education is well worth the expense, and families are increasingly getting into debt to pay for private school well before their child reaches college. This debt can be substantial, as the average tuition for day school is about $17,000, while the average cost of boarding schools is about $40,000 or more.

Educational consultants such as Matthew Greene at Howard Greene and Associates, suggest that parents start budgeting very early if they plan to send their children to private schools. According to Greene, parents should also take advantage of need- and merit-based financial aid. About 20-30% of students at private schools nationwide receive aid.

Applying for need-based financial aid and for merit awards can be a critical part of paying for private school. It can often be beneficial for private school applicants to apply to more than one school. Schools' financial aid packages vary, depending in part on their budgets, endowments, and commitment to recruiting a socio-economically diverse student body. Families can compare aid packages at different schools, and often, a school will match the aid package provided by another school, if they can, if the student has been accepted at both schools. Here is more information about applying for financial aid:

How Much Aid is Available?

According to publications put out by NAIS, or the National Association of Independent Schools, 18.7% of students at independent schools across the country are awarded some financial aid, and the average grant of need-based aid was $9,232 for day schools and $17,295 for boarding schools (in 2005). At schools with large endowments, such as the top-ranked boarding schools, about 35% of students receive need-based aid. At many boarding schools, families earning under about $75,000 year may actually pay little or nothing in tuition, so be sure to ask about these programs if they apply to your family. Schools with very large endowments can often afford to provide well over 40% of their students with some financial aid, making for a very diverse and merit-based student body.

How to Apply for Financial Aid

Schools award aid based on the economic need of the family, and families do not pay back this money. To apply for aid, you need to fill out an application; most schools use the Parents' Financial Statement (PFS), available at schools. The Parents' Financial Statement is submitted to the School and Student Services (SSS), an independent organization that helps schools that belong to NAIS (or the National Association of Independent Schools) determine how much a family can pay in tuition and other costs. More than 2,400 K-12 schools use this service, but some schools may not use the SSS, so ask these schools their process of applying for aid. The SSS makes objective decisions about how much a family can pay based on their income, assets, and obligations. Most families complete this application online, though you can also fill it out on paper. The cost is $37 for the online version and $49 for the paper version; if you cannot afford the cost, there is a waiver program, so contact the schools to which you are applying. In addition, you may have to submit documents such as tax returns or a Business/Farm statement to the schools to which you are applying. You have to fill out these forms each year you apply for aid.

Each school you are applying to will determine your financial aid package, based on their budget, endowment, and other variables. You should also ask your school about sibling discounts, as some schools offer reduced tuition if you have more than one member of a family attending the same school.

Merit-Based Aid?

Some schools also provide merit aid for students with specific academic, athletic, or other talents. In 2005-2006, they offered $25.7 million in aid, and the average grant was $3,545. Less than 5% of students receive merit scholarships, but you should ask your school about applying for this type of aid.

©2014 About.com. All rights reserved.