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Be Wise With Money

Digesting the Alphabet Soup of College Planning

What is EFC? What does FAFSA stand for? What does COA mean? When you're planning for college, you'll likely run into some unfamiliar and confusing words, terms and abbreviations.

From the application process to financial aid, the alphabet soup that comes with planning for college can be overwhelming and difficult to digest.

We've put together a list of some common college planning terms to help you learn the lingo so you can feel more confident as you prepare for college.

  • ACT (American College Test)

The ACT is a standardized college entrance exam that students usually take in the spring of their junior year of high school. The ACT consists of four sections (English, math, reading and science) with multiple choice questions, plus an optional writing test, that directly relate to what students have learned in high school classes. Most colleges require the ACT or the SAT as part of the admission application.

  • AP (Advanced Placement) & IB (International Baccalaureate) programs

Both AP and IB programs are designed to help students prepare for college by offering them a chance to earn college credits while still in high school. Most high schools offer at least one of these programs, and some even offer both. AP is American-based with nearly 40 subject-focused courses available, while the IB program is European-based and has more of an emphasis on writing.

  • CLEP (College-Level Examination Program)

This program from the College Board can help you get college credit for what you already know, and it costs much less than an actual college course. There are 33 CLEP exams you can take that more than 2,900 colleges and universities will give you college credit for if you pass. Think of it as saving time and money.

  • COA (cost of attendance)

This is the total amount it'll cost you to go to school (typically stated as a yearly figure). COA will differ at each school but it will always include the cost of room, board, tuition, fees and personal expenses (like books, supplies and transportation). You should also know that your COA plays a role in determining the amount of financial aid you're awarded.

This interactive tool from the U.S. Department of Education allows students and families to easily search for and compare colleges to find the best one for them based on their needs and interests. It has clear and reliable information on college cost, graduation, debt and post-college earnings.

Often called the PROFILE, this is an online application for nonfederal financial aid administered by the College Board. Nearly 300 colleges and universities require the PROFILE in addition to the FAFSA. Unlike the FAFSA, there is a small fee associated with the PROFILE. The questions the PROFILE asks are a bit more financially invasive than the FAFSA, but it can result in greater financial aid, grants and scholarships awarded.

  • DSST (DANTES Subject Standardized Tests)

Similar to CLEP, DSST is a credit-by-examination program designed to give you college credit by passing exams that assess your prior learning and knowledge. There are more than 30 DSST exams in a range of subjects that nearly 2,000 colleges and universities recognize and give credit to for passing scores. The exam fee is minimal compared to the average cost of a three-credit college course. And, for military active duty (and spouses), there is no cost for first-attempt exams.

  • DOE (Department of Education)

The U.S. Department of Education is in charge of establishing and maintaining education-related policies and improving the overall educational system. The DOE is responsible for providing federal financial student aid, collecting educational data, and identifying and resolving educational issues within the U.S.

  • EFC (Expected Family Contribution)

This is the amount of money that your family is expected to be able to contribute to your education costs. Essentially, it's what the Department of Education says your family needs to kick in before any financial aid applies. It's calculated based on the information you include in your FAFSA and is used to help determine your financial aid award.

  • FAFSA (Free Application for Federal Student Aid)

FAFSA is the form you need to fill out to apply for federal and state grants, loans and work-study programs. As the name suggests, there is no cost to submit the FAFSA. The FAFSA collects financial information from both you and your parents to calculate your EFC. Your EFC is then subtracted from your cost of attendance to determine your financial need, which your college will use to determine how much aid you can receive.

  • Graduation rate

This is the percentage of a school's first-year undergraduate students who enrolled in a four-year degree program and completed that program within six years. Think of it this way: The majority of students go to college with a four-year plan. Unfortunately, many students aren't able to actually graduate in four years. Some things, like changing majors or having too many extracurricular activities, are within the student's control. But others, such as class registration systems that use tenure-weighted lottery draw structures, prerequisites for required classes and the order in which classes are offered, are entirely out of the student's control. Because of this, it's common for a four-year plan to turn into a five- or six- year journey to graduation. In fact, the official numbers reported to the Department of Education are the six-year graduation rate numbers. As a result, you should assume that any published graduation rate is a six-year rate unless specifically labeled otherwise.

  • OOP (out-of-pocket)

This represents the amount of money you'll need to bridge the gap between your cost of attendance and your total financial aid amount. It can vary significantly for each school. Essentially, it's the bottom line, overall cost you'll have to pay for the college you choose to attend.

  • SAP (satisfactory academic progress)

You must make satisfactory academic progress in order to maintain your eligibility to receive federal student aid. Basically, it means you need to be making good grades and taking enough credits to keep getting federal financial aid. Each school has its own SAP policy on which criteria need to be met in order to stay eligible.  

  • SAR (Student Aid Report)

After filing your FAFSA, you'll receive your Student Aid Report. Your SAR is a document that summarizes all the information you submitted on your FAFSA and gives you your EFC results. It will include information on all of the colleges you've applied to as well as some basic information on your eligibility for federal student aid.

  • SAT (Scholastic Assessment Test)

The SAT is a globally recognized college entrance test from the College Board that most colleges and universities use in making admissions decisions. In March 2016, the College Board replaced the current SAT with a redesigned test that focuses more on what you're learning in high school and what you'll actually use in college. The new SAT has an evidence-based reading and writing section, a math section and an optional essay. And, with the new SAT, there is no penalty for guessing on answers (previously, points were subtracted for wrong answers).

  • NACAC (National Association for College Admissions Counseling)

NACAC is an organization made up of more than 15,000 professionals from across the globe. It's responsible for setting the ground rules for when colleges can begin setting application deadlines. The organization also determines what questions schools should or should not ask students, as well as establishes and maintains the guidelines for professional practices among schools that may be competing for qualified students.

Getting to know those terms should help you approach your college planning journey with a bit more confidence. These additional resources can also help you along the way:

  1. uPLAN College Planning Strategies – Attend free college planning workshops and get information on family financial preparation for life after high school.
  2. College prep: How to plan ahead for higher education – Learn about and compare college savings methods.
  3. College savings calculator – Create or fine-tune your education savings plan.

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