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Need Based Financial Aid: The Difference Between Need-Blind and Need-Aware

Need based financial aid lingo can be confusing, especially with respect to the terms “need-blind” and “need-aware.” These descriptors are devoid of any further context about exactly who is “blind” or “aware” to your need.

To simplify the equation, there are two standpoints from which you might be thinking about need based financial aid: (1) admissions prospects (2) financial aid (need-based) or merit/affinity-based scholarships. Most often, these two viewpoints will align...but not always.

Usually, when schools talk about being “need-blind” or “need-aware,” they are referring to their admissions office policy. Put simply, the question that these terms are an answer to is: “Will my request for financial assistance harm my chances of admission in any way whatsoever?” Keep reading to truly understand need based financial aid, and what need-blind vs. need-aware means for you.

1. Need - Blind:

If the school is “need-blind,” then the answer is “No, requesting financial assistance will have absolutely no impact on your admissions potential.” It means that the school’s admissions office makes their decision on your merit as a candidate totally separately from the decision of whether to grant financial aid or not.

You might still be skeptical that there is no possible way a school would be this magnanimous, and that your need based financial aid request might still have an effect of some sort. This isn’t true at all, so don’t worry about it. Often times, the admissions office and financial aid offices are separate, or at least reviewed by separate individuals who are not in communication with each other about a candidate.

2. Need - Aware:

On the other hand, if the school is “need-aware,” then the answer is “Yes, requesting financial assistance may have an impact on your admissions potential.” It means that the school might choose to accept a candidate with the financial resources to pay full tuition over an equally compelling candidate without those financial resources. Often, schools will consider finances in their admissions decisions in order to give them the ability to meet full need for all accepted applicants (by pre-selecting a certain amount who can afford to attend on their own).

At most of the Top 30 schools, the effect of being “need-aware” is not very severe domestically, but it can be for international students. This is because of the sheer volume of international applications who do have the resources to be “full pay” students. This reinforces the idea that if you don’t actually need the money, but are taking a shot in the dark that you might receive some aid, you should reconsider that strategy.

3. Need - Blind vs. Need - Aware for International Applicants

If you are an international student, you need to pay particular attention to the details on  each school’s financial aid website. There is usually an FAQ section that answers these questions. One important detail for international students is to look at is how the school defines an “international student.” Usually, “international student” excludes U.S. green card holders, who are treated as U.S. students at schools who would otherwise be need-aware.

The following five schools are currently “need-blind” to international students: Harvard, Yale, Princeton, Amherst, and MIT. But you shouldn’t rely on blogs that you find online, either. Even this one! While we know it is accurate at the time of posting and have verified with phone calls to the admissions office, these policies are subject to change as schools’ budgets and policies change.

For example, Dartmouth College used to be one of the only six schools that would meet 100% of international students’ demonstrated financial need without those considerations playing a role in the actual admissions decision. As of last year, that is no longer true. The same goes for Cornell.

The reason that other schools are not “need-blind” for international admissions is often that they can’t afford to be. It’s not because they prefer domestic students over international students or because they are racist. There are certain federal and state-based aid benefits for U.S. citizens or permanent residents that are not available to international students. Consequently, the university would need to cover those additional costs for international students that the federal or state government would not be subsidizing.

4. Scholarships

People often confuse the concepts of “need-aware” or “need-blind” aid with merit or affinity-based scholarships. This is a totally separate issue from need based financial aid, so be careful not to confuse them. Some schools will award academic scholarships for a high school class rank, or affinity scholarships for those who excel in specific academic disciplines. However, many top schools (including all eight Ivy League schools) do not offer merit or affinity based scholarships at all. Instead, they make all financial aid or “scholarship” decisions based on the “need” of their students. Top schools have the luxury of doing this because they have large college endowments and plenty of funding, so they don’t need to use scholarships as a way to compete with other schools.

When I was applying to college, I was offered a full-tuition plus living stipend merit-scholarship to the University of Southern California. Yet, no matter how strong of a student Dartmouth may have thought I was, they were not able to offer any such scholarship and could only base financial aid decisions based on my family’s financial resources at the time.

But still, not all top schools follow this model. For instance, Stanford gives plenty of merit scholarships for athletes whereas the Ivy League schools do not; as a result, Stanford attracts far better athletes and fields significantly better sports teams. Outside of the sports context, some schools use merit-based aid to attract better students. When I was admitted to Harvard Law School, it became much more unlikely that I would seriously consider my offer of admission at the University of Chicago Law School without significant financial incentive. It ended up that Chicago’s financial package wasn’t quite enough for me to turn down Harvard, but it certainly complicated my decision. The schools know this, and they will offer financial packages to attract students who might otherwise go to another school.

Need based financial aid calculations can be complex, but knowing the distinctions between need-blind, need-aware, and scholarship policies is key to understanding financial aid applications at different colleges.