The first question students ask is "Will I be accepted at college X?" The first question parents usually ask is "How can we afford to pay for college X?"

With college tuition prices escalating annually, faster than the cost-of-living index, discussing what funds are available for college is a conversation every family needs to have.

Over the next several weeks, I will cover a variety of topics related to paying for college, including financial aid resources, merit-based and specialized scholarship opportunities and items to be aware of as you navigate through the financial aid process.

Today's column is a basic financial aid primer.

> Basic types of aid

Need-based: Financial aid that is determined by your calculated ability to pay. Don't assume that your family won't qualify for financial aid. Fill out the appropriate forms: the FAFSA ( and the CSS PROFILE ( You may be surprised and find you are eligible for aid. These forms are not that complicated and you don't need to pay someone to complete them for you. Need-based aid includes:

Grants: (money that doesn't need to be paid back) from the federal government, (Pell Grants -- awarded to undergraduate students in lower-income brackets); your state (check the U.S. Department of Education list of state higher education commissions --; and directly from the college.

Self-help: Work-study programs through the college and/or loans from the federal government, your state or directly from the college.

Merit-based: Aid provided based on academic abilities (grades and test scores), special talents or skills including arts, athletics, community service and leadership. These are generally scholarships that do not need to be repaid and come from private organizations, foundations, your state or that are funded directly by the college.

> Terms to know

Cost of attendance (COA): Cost of attendance includes: tuition, room-and-board, fees, books and personal expenses. Just looking at the cost of tuition is misleading. Annual room-and-board fees can range from $5,950 at the University of North Dakota to $14,668 at New York University. Colleges tack on fees for student activities, printing, health insurance, borrowing of university-owned equipment, etc. Costs for books, supplies, personal expenses and travel can easily total over $2,500 per year. College websites detail the current cost of attendance on their financial aid pages. Financial aid professionals suggest anticipating a 5 percent annual increase in tuition and associated fees.

Expected Family Contribution (EFC): The FAFSA formula takes several factors into account to determine a family's EFC: annual income, certain assets, family size, parental age (the older the parent, the larger the allocation toward retirement), reasonable nondiscretionary expenses as well as the number of students in the household attending college currently and/or will be attending college in the near future. Many colleges also request that families complete the CSS PROFILE. The PROFILE considers home ownership, K-12 private school tuition, regional cost-of-living differences, etc.

Lee Bierer is an independent college adviser based in Charlotte, N.C. For more information, visit