Need analysis measures a family's financial strength to determine ability to pay for school. Some scholarship and voucher programs use simple tables based on income and family size, establishing income cutoffs on eligibility. Others use a more sophisticated analysis.

Typically need analysis defines discretionary income by subtracting mandatory expenses from total income. Mandatory expenses include basic allowances for food, clothing, shelter (including utilities), medical care and transportation, as well as taxes. The allowances will depend on family size. The remaining income is discretionary in that the family may have some flexibility in allocating this money for expenses and savings. Most need analysis formulas will assess a portion of discretionary income, often on a bracketed scale.

The FinAid site includes several need analysis calculators that are focused on need analysis for financial aid for college. However, the same calculators can be used for need analysis for private K-12 scholarships and vouchers. FinAid's QuickEFC Calculator is used by some programs. Others use FinAid's Simplified EFC Calculator which is equal to 15% of the amount by which adjusted gross income exceeds 150% of the poverty line, divided by the number of children in private K-12 schools. Both calculators are available free of charge.

Need Assessment Companies

The following companies are used by some of the need-based scholarship and voucher programs to evaluate financial need.

• Development Testing Services, Confidential Financial Analysis (CFA), PO Box 6903, Colorado Springs, CO 80934, 719-685-5783, fax 719-687-0705 info@dev-test.com.

• Family Financial Needs Assessment, PO Box 466, Hernando, MS 38632-0466, 1-800-579-7200 or 1-662-429-3473, fax 1-662-429-8500 or email ffnafax@ffna1.com.

• Private School Aid Service, 909 Canterbury Road, Suite P, Westlake, OH 44145, 1-800-722-2577, info@psas.org.

• School and Student Service for Financial Aid, SSS by NAIS, PO Box 449, Randolph, MA 02368, 1-800-344-8328, email sss@nais.org.

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