Students are leaving financial aid dollars on the table. That's preventing some from enrolling in colleges they don't realize they can afford.
"Often they don't know, or are confused by, the options," said James Applegate, a visiting professor at the Center for the Study of Education Policy at Illinois State University and an expert in college access.
Last year, some 661,000 low-income high school graduates failed to cash in on $2.6 billion in financial aid because they didn't complete the Free Application for Federal Student Aid (FAFSA). That's according to an October analysis by NerdWallet that found each of those students could have been eligible for an average of nearly $4,000 in Pell Grant money.
While more than half of high school graduates were eligible for federal aid, including those who didn't go to college right away, over one-third of graduates didn't apply for it, the report found.
Red tape around financial aid is one barrier. One-third (32%) of students who didn't complete a FAFSA thought they weren't eligible for aid, according to a federal study published late last year. Another 28% didn't want to incur debt, while 23% said they didn't have enough information about how to do the paperwork, and 24% said they either did not know they could complete a FAFSA or thought the form was too much work.
Yet not all students end up paying full price for college. In a recent New York Times analysis of the real cost of attending some of the country’s most selective colleges, low-income students paid far less as a rule than did more affluent students. Still, the perception of many colleges as cost-prohibitive based on their hefty sticker prices persists.
As elite colleges and universities sharpen their focus on recruiting low-income, minority and adult learners — groups with which they've struggled to make critical inroads — they are starting to look closer at one of the big reasons those students don't apply.
Facing the FAFSA
There are several reasons why students don't fill out a FAFSA or apply for other forms for assistance, said Sandy Baum, a nonresident fellow at the Urban Institute who specializes in college access and affordability. Additionally, concerns about immigration status, a criminal record or limited English skills could further prevent students from applying for aid.
"The FAFSA has gotten much better, but it can still deter students," she said.
Confusion about the variety and sources of financial aid is heightened by unending talk about the high cost of college and student debt, said Laura Perna, a professor in the University of Pennsylvania's Graduate School of Education and the executive director of its Alliance for Higher Education and Democracy. Some applicants may not know the difference between a loan and a grant. Others, she said, may think a bad credit rating or having money saved will make financial aid unobtainable, or that poor high school grades will make them ineligible.
With their high school counselors carrying caseloads of around 480 students, on average, college advising becomes a lower priority— particularly when it comes to financial aid. Further, counselors may not be trained to provide that sort of assistance. However, research shows students are more likely to complete the FAFSA with counselor support.
What's more, students often don't even know what their out-of-pocket costs will be until they complete the FAFSA and receive award letters from colleges where they applied. That occurs after the application and admissions process.
Prospective students aren't the only concern, however. "It's almost as big a problem with our enrolled students," said Soumitra Ghosh, assistant vice president of student recruitment at Rowan University, which offers low-income and first-generation students one-on-one guidance to help obtain aid. "They're busy and it's a lot of government forms. Who wants to do that?"
Enrolled students often don't resubmit applications or search for new aid sources, Ghosh said, even if they've succeeded in the past and have a better idea of how much money they might be on the hook for.
Closing the gap
Educating prospective students about the financial aid process is important, Applegate said, particularly as colleges become more concerned about maintaining enrollment levels in light of data forecasting a decrease in the number of high school graduates in the coming years.
Working together is key.
"Many times there are a surprising number of individuals and groups working on college access in a region without really collaborating," he said. "Colleges can step in to coordinate those efforts and tap into that energy."
He recommends colleges offer information sessions at high schools, which small private and regional institutions may be able to do more easily, he said, because they already have a small pool of schools they draw from as well as pre-existing relationships with the staff and local families.
Ghosh said his staff makes that a priority. He and Applegate also agree that providing information on financial aid to parents is important, generally in the form of well-publicized information sessions.
The University of Dayton uses data to prioritize visits to high schools by admissions staff and students, including to some that typically aren't on the university's radar because they haven't traditionally supplied many students, said Donnell Wiggins, assistant vice president of new markets for admissions. On such visits, U of Dayton representatives often spell out what the cost of attendance might be for an individual student, review financial aid options and share resources that could help them get an accurate view of the expense.
Perna, of the University of Pennsylvania, said messaging about financial and access is key.
That proved critical in a test of a new outreach strategy for the University of Michigan's High Achieving Involved Leader (HAIL) scholarship, which grants low-income, high-achieving students in the state four years of free tuition and fees without requiring them to fill out financial aid forms. Students in the study were already eligible for the aid.
Students who received a "large, glossy, and brightly colored" personally addressed packet informing them they qualified for the aid, would succeed at the college and didn't have to fill out financial aid forms were more than twice as likely to apply (67%), be admitted (32%) and enroll (27%) than students who received a postcard with application deadlines.
With its Blue and Gold Opportunity Plan, the University of California System aims to offer "a simple message of affordability," said Michael Miller, assistant vice chancellor for enrollment services at UC Santa Barbara. The grant offers four years of free tuition and fees to California residents whose families earn less than $80,000 a year and who qualify for financial aid.
A webpage advertising the program also includes flyers in English, Spanish, Chinese and Vietnamese, each with a highly visible affordability message and reassurance that "there's no special paperwork" needed to apply so long as students fill out their financial aid forms on time.
"Navigating the higher education enrollment process can certainly be a challenge for families who have never gone through the process," Miller said. "Financial aid can be especially challenging if students and parents don't know what to expect."
Like many colleges, Rowan details the financial aid process on its website, which includes a net price calculator, a timetable for federal and institutional deadlines, and financial literacy information.
Some colleges also direct students to third-party tools like the Education Department's Net Price Calculator or College Scorecard, while others encourage students to use MyinTuition, an app that helps estimate college costs.
For many students, wariness of the cost of college extends beyond tuition to include room and board, textbooks, transportation, and other expenses. More colleges are realizing the barrier these additional costs present.
Michigan's St. Clair County Community College offers a scholarship to cover some costs that could lead to a student dropping out, such as rent, medical bills and car repair. Through its Get To Next Scholars program, Marion Technical College, in Ohio, gives students a stipend for books in addition to covering some tuition.
Miller said UC Santa Barbara is seeing success from its pilot of the Promise Scholars Program, which guarantees at least $120,000 for incoming, low-income freshman over four years and $60,000 for transfer students over two years. "Traditional aid programs look at need on a year-by-year basis, which leave families wondering if they can afford to continue pursuing a college degree," he said. The funds can be used for fees, health care, housing, books and supplies and other personal expenses, including transportation and cell phone service.
"The FAFSA has gotten much better, but it can still deter students."
Nonresident fellow, Urban Institute
Private colleges are also trying to position themselves as more affordable, with recent moves designed to attract students from higher income brackets who are concerned about the cost of college.
The University of Virginia is offering reduced tuition to students with annual family incomes under $80,000. Rice University it discounting tuition for students whose families make up to $200,000. And Liberty University is adding a scholarship for students whose families earn between $35,000 and $95,000.
Keeping students informed about financial aid is an ongoing process. To encourage enrolled students to complete financial aid materials for the next academic year, Rowan emails students with reminders and posts signs and billboards advertising deadlines around campus. This year the university is running a contest with prizes for students who turn in FAFSA forms.
"To enroll this group of students (low-income and first-generation), it is critical, however, that we help them understand this information and the fact that college is often affordable to them," Ghosh says.