11/20/2012 11:26 am ET Updated Jan 20, 2013

Getting the Best Deal on College


Four more years. Some people loved hearing those words that were shouted as President Obama's reelection was announced -- others, not so much. But regardless of your political views, the Obama Administration is aiming to make college costs more transparent to students.

Whether you agree he can make that happen or not, a key piece of his plan to make college more affordable is improved transparency of college costs and value. The administration feels that students face confusion when evaluating financial aid packages which, in turn, makes it difficult to compare aid offers.

Their solution: a Financial Aid Shopping Sheet.

The form begins with a school's costs, then factors grants, scholarships and other financial aid you would need to attend a school. All that information is then calculated and potential students are presented with what their monthly payment could look like after they graduate. In addition, listed on the right sidebar are the school's graduation rates and the rate of which its graduates default on their loans.

Although I applaud the intentions behind this form (I'm a big advocate of transparency and candor), in reality it barely scratches the surface. It's just the first step on the long journey of fully navigating the college admissions and financial aid process. Two major reasons why:

First, colleges aren't required by law to adopt this form. They are "encouraged" to use it. Some private schools may feel that this stat sheet would reflect poorly on them and therefore decline making the new shopping sheet available. Or they may feel that there is no simple formula to truly take into account every single thing the school looks for when awarding aid. They also may feel that they don't want people swayed by putting an "average" number out there, when any particular family may not fit the "average" profile.

I'm sure many more colleges will eventually adopt the form, but it'll most likely be years down the road -- well after many families have made their college enrollment decisions. And families need a lot more information than this form can provide.

So much goes into deciding what school is best. You should start with the discovery process of picking the right type of school, build the ideal school list, and then look at which schools will give you money and which ones won't. If you pick the "wrong" school, who cares if their average graduation rate is good or their average debt load upon graduation is favorable? These numbers mean little if you pick a school where you're not happy and end up taking six years to graduate.

That leads me to reason number two: Every family's situation is unique. Sure, millions of households have the same income, but that doesn't mean they have the same assets, or that their students have the same academic abilities, athletic abilities or needs.

Put simply, there are just far too many factors to consider when deciding what college to attend than a simple shopping sheet can cover. Student aid policies vary widely from school to school. To truly discover what you, specifically, can expect to pay to attend a particular school requires you to dig deeper. There are three key phases you need to maximize in order to get into your dream school and not have it put you in the poor house.

The first is what I call the PLAN phase. This is where you need to do some real soul searching on what really interests you and make sure you pick the school that's the right fit for you -- both academically and financially.

Second, is the PACKAGE & PREP phase. For example, if the owner of a small business is looking to sell his company, he will want to make the company look as pretty as possible on paper to attract the highest sale price. Similarly, you need to package and prep yourself to look as good as possible on paper so that not only does your school of choice want you, but they're willing to give you a great aid package to get you to choose them.

Third, is the PAY phase. This is where you need to successfully navigate the financial aid process by ensuring you meet all deadlines and that all forms are filled out accurately. Also, don't be afraid to negotiate with a college if your offer is less than you expected. Having offers from comparable schools will help you state your case in the appeals process. Therefore, you always want to apply to at least two or three schools that are rated somewhat equally.

This decision is one of the biggest ones you will make in your lifetime. So use the new Financial Aid Shopping Sheet to help you in your college selection process, but don't rely on it to make the decision for you.