Across the country, many current and prospective students are asking themselves a pivotal question, “Can I afford a college education?” As students discern where, or whether, to attend college, student affairs professionals are there to help with putting the affordability puzzle together. Part of this task, of course, is about financial literacy, or educating students about costs and budgeting, the responsible use of financial aid, and planning for a financial future beyond their time on campus. Being informed about financial aid options and eligibility does help to clarify the affordability question, while also building on student literacy about finances during and after college. To this end, student affairs professionals have made use of the Free Application for Federal Student Aid (FAFSA), budgeting tools, student loan repayment calculators, and other resources to help students make informed decisions on college affordability.
The partnership between students and the professionals committed to their financial education and well-being, however, has been met with a key challenge. The challenge is that the aid packages that outline the mix of grants, scholarships, and loans available to students, as well as any unmet financial need, arrive too late to help some make informed decisions about paying for college – and doing so with minimal debt. Not being equipped with timely and adequate information contribute to the possibility that some students may over-borrow or make the choice not to enroll.
What can be done to enable students and their families to have more timely access to information that will support more informed decision-making? Since taking office, President Obama has initiated several measures to not only make it easier to apply for federal aid, but to also equip students and their families with more timely information about aid eligibility. Earlier in his term, for example, President Obama streamlined the FAFSA to allow applicants to skip questions that were irrelevant to them. In addition, the president took measures to link the FAFSA with income data that families submit to the Internal Revenue Service when filing taxes. This step enables students to automatically upload this information to the online FAFSA form, and is intended to reduce difficulty, confusion, and the prospect of error through manual entry.
In September, President Obama took executive action to allow students to apply for aid significantly earlier than students are presently able. Because the current FAFSA application process uses tax information from the prior year, students have to wait until January or later – depending on when they or their parents/guardians file – to apply for federal aid. For many students, this means that they will begin searching for a destination institution before knowing whether or not their total aid packages will cover costs. What is more, students will not know how much of the aid package will be comprised of grants, scholarships, and/or loans. President Obama’s action allows students to use tax information from two years prior, enabling students to apply for federal aid much earlier and have packages available alongside other factors that may influence a student’s college-decision-making. This action is set to be implemented in October 2016 for students looking to enroll in the 2017 academic year.
Taken collectively, these actions are designed to empower students to make more informed college choices. But these policy actions also enable student affairs professionals to build on our unique opportunity to educate current and prospective students about financial literacy as they navigate to and through college. With more timely information, we can help students navigate the question, “Can I afford a college education?” And in the process, we can contribute to their success and financial well-being during and after college.
This post is part of our #CSAM15 series, in partnership with NASPA. Through these posts, we hope to highlight what it means to have a career in Student Affairs with a diverse group of contributors. With a focus on the students, defining Student Affairs, hot topics, and Striving Towards Betterment, there will be a lot to learn about this month! For more information, check out the intro post by John Weng at NASPA. Be sure to read the other posts in this series too!
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Podcast With Liz Gross on Social Media Success in Higher Education