What Counts As “Demonstrated Need” For Financial Aid?

A jar of coins, mostly pennies and dimes.

Flickr user Nick Olejniczak

There is a common misconception in the minds of many college students: They believe they do not qualify for need-based aid based on their family’s income. But the definition of “need” is actually a little more flexible than what income bracket your parents’ finances fall into.

When a college or scholarship requires you to show “demonstrated need” for financial aid, all they mean is that your Expected Family Contribution (EFC) does not meet the Cost of Attendance (CoA). This makes demonstrated need a fluid figure. Income changes, your year in school, how many people there are in your family, and whether or not you have siblings in college can affect this number.

One way to think about it is this: If your EFC is $15,000 per year, and your CoA for a particular school is $14,000, you do not have demonstrated need. But if you take that EFC of $15,000 per year and apply it to a school with a CoA of $40,000, you now have a demonstrated need of $25,000. This means that the cost of the schools you are looking into affect your demonstrated need.

Here it is in a quick math equation:

Cost of Attendance

– Expected Family Contribution

Demonstrated Financial Need

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