• College costs are not what they seem. At first glance, the cost of college can seem astronomical. Average costs for tuition and accompanying fees (board, transportation, etc.) average from about $10,000 per year for lower-cost state schools to more than $25,000 per year for private schools. However, this is just the so-called sticker price. The actual cost is that sticker price minus the package of financial aid--grants, work-study, and loans--that you and the college financial aid office put together.
  
  Most students (between two-thirds and three-fourths) get some kind of financial aid. If you use the financial aid system effectively, you should not have to pay more than you can afford, with a margin of comfort.



• Try to estimate the total cost. If your child is planning to start college next year, you can obtain estimated costs from any of several college guidebooks, available in the reference section of your local public library or online. If you are planning ahead, you have to take inflation into account, so it's important to note that college costs are rising at approximately 6 percent per year.
  
  Several websites have handy calculators that can calculate and add the compounded interest, so you will know what college is likely to cost when your child is ready to start. For example, according to one calculator, if your child were to start attending a college with $15,000/year annual costs four years from now, his education would end up costing $83,000 for all four years. (This breaks down to approximately $19,000 for freshman year and, since prices continue to rise even when your child is enrolled, $23,000 for senior year.) But remember, unless you have a very high income and limited expenses, you are not likely to have to pay this full cost.



• Look at aid packages. Aid packages include: 1) grants and scholarships (money you don't have to repay); 2) loans (both from the federal and state governments, with or without subsidized interest payments, as well as from private lenders); 3) and work-study, jobs that are arranged through the school that offset college costs while also allowing a student to gain work experience.
  
  Most aid is need-dependent--that is, it's tied to your family income and assets plus the number of children in college. Need-independent scholarships are awarded for specific fields of study or based on a student's background, disabilities, or other traits.



• Start with the federal government. By far, the majority of student aid money (about 75 percent) comes through the federal government. The government has tried to streamline the process of getting that money by creating a unified application form, the Free Application for Federal Student Aid, or FAFSA.
  
  Almost all financial aid that is based on demonstrated need requires that you complete a FAFSA. You need to complete it only once, and then the information is available to the financial aid offices at all the colleges you apply to.
  
  The easiest way to complete the FAFSA, if you have a computer, is to go to the Department of Education website, www.fafsa.ed.gov. You can also download the FAFSA program, available in Spanish as well as English. FAFSA asks for information about your income, savings, and other assets. It's best to have on hand a copy of your latest income-tax forms, since many of the questions ask for information from specific parts of the form.



• Avoid paying consultants. There is an industry of consultants who promise to make finding college scholarships easier and more effective. Some of these services are helpful, but others simply provide you with the same information that you can access easily yourself, for free.
  
  There are several user-friendly, well-reviewed websites that provide scholarship searches for free. In addition to computerized searches, you can go to your local library for handbooks of student financial aid that have extensive listings of colleges and the financial aid funds available through them.

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