Each year, higher-education institutions spend significant revenue on recruiting and enrollment, only to see their pipeline of admitted students evaporate.
It is an equity problem with profound economic implications for would-be students, in particular the low-income and first-generation students that institutions are working hard to attract and serve.
It is also a concern that can have serious business implications for smaller and tuition-dependent institutions. Thousands of students are lost each year as a result of the complex financial aid process. That means marketing and enrollment budgets are squandered as students fall out of the enrollment pipeline.
Here are three questions that university leaders should ask to ensure they aren’t losing students in the financial aid process.
1. How many students are struggling with our procedures?
Although the rate at which students turn away from college due to the financial aid process varies among institutions, it’s clear the problem is pervasive nationally. More than a third of students who don’t file the Free Application for Federal Student Aid (FAFSA) would qualify for a Pell Grant. Even those who complete the FAFSA sometimes don’t have the stamina to navigate the maze of paperwork and reports that are required to complete the financial aid process. Some 40 percent of low-income students accepted to college forego higher education altogether.
Institutions and their financial-aid offices must learn how many potential students they are losing throughout this process. The first step is to ask about, and measure, an institution’s financial aid completion rate. Most institutions should have the data to populate the numerator and denominator of this simple equation: How many students start the process and how many finish?
2. Is financial aid verification creating a barrier to college access?
Concerns about the impact of the federally required financial aid verification process are growing in importance and visibility. Students whose applications are flagged for further review often fail to complete the final verification stages of the process.
Consider this: In any given year, about 30 percent of all students filling out the FAFSA must go through an audit process called verification. During this stage, students must provide additional documentation to prove that the forms they have already filled out are accurate. It can be a complicated process, with students forced to track down hard-to-find documents and fill out tedious paperwork.
Many simply give up.
Verification is an important and necessary part of the financial aid process, but far too many students are being lost along the way.
At a Senate hearing last year, Nancy McCallin, president of the Colorado Community College System, explained that more than half of the system’s students who were selected for verification in 2016 did not complete the process. That’s nearly 18,000 students in one community college system alone who didn’t receive precious financial aid after their applications were flagged for verification.
3. Do our aid processes have a disparate impact on low-income and minority students?
For most institutions, the answer to this question is most certainly “yes.”
Many of these students, unaware of the various aid packages available to them, assume they cannot afford to go to college. One survey in 2017 found that more than one in three (34 percent) of “high-achieving, low-income students reported that the stated costs of tuition, fees, and room and board had discouraged them from applying to college altogether.”
For those who decide to enroll in college, applying for financial aid can seem complex, especially to first-generation students whose families have little or no previous experience with the process.
This disproportionately affects poor students, who are selected for verification at far higher rates than their more affluent peers. According to an analysis of federal data by the National College Access Network, 98 percent of students flagged for the verification process are low-income FAFSA applicants. And, just 56 percent of Pell-eligible students who were selected for aid verification went on to receive the aid, compared to 78 percent of eligible students who were not selected for verification.
But this disparity in who is selected for verification is just a part of the problem. Low-income and first-generation students drop out at various stages of the aid process. Scholarship fatigue can tamp college-going aspirations. Families stop short of enrollment due to confusion about the financial-aid package detailed in the award letter. Institutions must do more to keep low-income students who are accepted to college within higher education’s opportunity pipeline.
The purpose of an institution’s financial aid process should be to help lower the barriers that may hinder students from receiving an education. By asking the right questions, institutions can start to ensure the process doesn’t become a barrier itself.
This story about college affordability and student financial aid was produced by The Hechinger Report, a nonprofit, independent news organization focused on inequality and innovation in education. Sign up for the Hechinger newsletter.