Home » Financial Terms Glossary

Financial Terms Glossary

Finance & Financial aid terms can be an alphabet soup of acronyms like FAFSA, SAR, SAP and EFC and technical terminology. It is almost like speaking a foreign language. This glossary defines the terms and acronyms that are most frequently used in basic finance or student financial aid.

Edvisors® allows the use of its glossary content by any college, university, non-profit, or other educational access agency, if the content is linked from the Edvisors® page. At any time Edvisors® may limit use per its Terms of Use policy.

Academic Transcript

A transcript is a record of the classes taken by a student and the student’s academic performance.

ACT

American College Testing Program

Admission

College admission is the process of applying and being accepted for enrollment in a college or university.

Admissions Test Scores

Admissions test scores are the student’s scores on standardized college admissions tests, such as the ACT and SAT.

Admit-Deny

An admit-deny situation occurs when a college grants admission to a student but fails to award the student the financial aid he or she needs to be able to afford to enroll at the college.

Class Rank

Class rank is a relative measure of academic performance. It compares the student’s performance against the performance of all other students in the class. It may be expressed as a numeric rank (e.g., the class valedictorian had a class rank of one) or as a percentile (e.g., the student ranked in the 95^th percentile).

Deferred Acceptance

After a student is admitted to a college, the student may ask the college for permission to defer the student’s acceptance for a year. Students often use this gap year for study abroad.

Dual Enrollment

Dual enrollment programs allow high school students to take college courses and simultaneously earn credit toward a high school diploma and a college degree or certificate. Students who are enrolled in a dual enrollment program are not eligible for federal student aid because they are still enrolled in high school.

Early Action

Early action (EA) is a non-binding form of early admission to college. Students admitted in an early action program usually have until May 1 to decide if they will attend a specific college or university.

Early Admission

Early admission applications have earlier deadlines than the regular college admission process, typically November 1 instead of January 1. Colleges may notify early admissions candidates about the status of their application early, typically in mid-December instead of late March or early April. Some early admissions candidates will be accepted early, some will be rejected early, and some will have the decision deferred to the regular admission pool. The two main types of early admission are early action and early decision.

Early Decision

Early decision (ED) is a binding form of early admission to college. The applicant has committed to enrolling in the college if he or she is admitted as part of the early decision application pool.

Elite College

An elite college is a very selective or prestigious college.

Financial Aid Safety School

A financial aid safety school is a college that will not only admit the student, but where the student could afford to enroll even if he or she gets no financial aid.

Gap Year

After a student is admitted to a college, the student may ask the college for permission to defer the student’s acceptance for a year. Students often use this gap year for study abroad.

Grade Point Average

A student’s Grade Point Average (GPA) is a measure of the student’s academic performance, typically reported on a 0.0 to 4.0 scale. An “A” grade corresponds to a 4.0, a “B”; grade to a 3.0, a “C” grade to a 2.0. Students must maintain at least a 2.0 GPA to retain eligibility for federal student aid.

In-State Public College

An in-state college is one that is located in the same state as the student’s state of residence. In-state students usually pay lower tuition at in-state public colleges than out-of-state students and international students.

In-State Student

An in-state student is a student who has legal residence in the same state as the state in which the student’s college or university is located. In-state students at public colleges and universities may be charged lower tuition than out-of-state students.

Ivy League

The Ivy League is a group of eight elite colleges: Brown University, Columbia University, Cornell University, Dartmouth College, Harvard University, Princeton University, the University of Pennsylvania and Yale University.

Leveraging

Leveraging uses financial aid funding as a recruitment tool to attract academically or athletically talented students or wealthy students. It can involve the awarding of non-need-based aid as well as adjusting the mix of grants and loans in a need-based financial aid package (preferential packaging).

Match School

A match school is a college or university where the student’s academic performance falls within the range of academic performance of the school’s typical freshman class.

National Candidates Reply Date

May 1 is the National Candidates Reply Date, the date by which students must notify the college or university that they have accepted the school’s offer of admission.

Need-Aware Admissions

A college has a need-aware or need-sensitive admissions policy if it considers the student’s ability to pay alongside other criteria while deciding whether to admit the student.

Need-Sensitive Admissions

A college has a need-sensitive or need-aware admissions policy if it considers the student’s ability to pay alongside other criteria while deciding whether to admit the student.

Open Admission

An open admission college admits most students who apply. The admission criteria are minimal and unselective, generally requiring only a high school diploma, GED or the equivalent.

Preferential Packaging

Preferential packaging is the awarding of non-need-based aid as well as adjusting the mix of grants and loans in a need-based financial aid package. Typically, preferential packaging is used by colleges as a recruitment tool to attract academically or athletically talented students or wealthy students.

Reach School

A reach school is a college or university where the student’s academic performance falls short of the academic performance of the school’s typical freshman class. A student is unlikely to be admitted to a reach school.

Rejection

A student whose application for admission is rejected by a college is denied admission to the college. The student may receive a rejection letter telling him or her about the admission committee’s decision.

Rolling Admission

A college with a rolling admission policy evaluates applications as they are received during a long period of time (in some cases, throughout the year). Admissions decisions are made within a few months of receipt of a completed admissions application. Some rolling admissions colleges admit the students on a first-come, first-served basis. Admitted students may start throughout the year, usually at the start of the next academic term.

Safety School

A safety school is a college or university where the student’s academic performance falls above the range of academic performance of the school’s typical freshman class. A student is likely to be admitted to a safety school.

SAT

Previously called the Scholastic Assessment Test and Scholastic Aptitude Test, this college admissions test is now known as just the SAT.

Selectivity

A college’s selectivity is the percentage of applications that receive offers of admission. Selectivity measures the difficulty of getting in to the college.

Waiting List

If a student has not been admitted by a college, the college admissions office might place the student on a waiting list instead of rejecting the student’s college admissions application. If enough of the college’s admitted students do not accept the offer of admission, the college admissions office may decide to extend offers of admission to some of the wait-listed students.

Yield

A college’s yield is the percentage of admitted students who enroll. Yield is a measure of a college’s desirability.