Money Matters

Most financial aid offices are already beginning to receive appeals from families looking to improve their aid awards. A recent Wall Street Journal article encouraged families who were unhappy with their aid offer to call the aid office “as soon as possible.” Financial aid appeals have been a regular part of the aid awarding landscape for some time now, but the way institutions respond to appeals varies widely. How your own institution responds can affect enrollment, net tuition revenue, and your school’s reputation in the marketplace.

With families’ growing concerns about financing higher education, and the federal government’s increasing involvement in recommending and/or requiring certain communications regarding institutional costs, every institution should be taking a step back to review all of the tools currently being used to present affordability, explain the aid application process, and communicate the awards themselves.

With today’s increased focus on college costs, the call for disclosure of information about affordability and outcomes has also been on the rise. Besides the traditional rankings, a growing number of websites purport to shed light on affordability, or net cost, or return on investment based on IPEDS data combined with other information sources. Examples include the Department of Education’s College Affordability and Transparency Center; Payscale’s ROI rankings; the CNNMoney Cost Calculator; and the New America Foundation Federal Education Budget Project (FEBP) searchable database.

The vast majority of independent, private sector, higher education institutions are more than 80 percent dependent on tuition and student fees—the exception of course being that small cadre of elite, well-endowed institutions that comprise a small portion (less than 10 percent) of private schools. Even most of the nation’s public colleges and universities are increasingly dependent on tuition revenues and often student headcount affects the allocation of state support.

If you still watch TV with commercials, you may have seen an ad recently talking about using data to improve your business—the bakery that mined its sales data to discover that people buy more cake on rainy days, for example. Everybody’s talking about “big data” and “data science,” basically applying sophisticated analytic techniques to large datasets. And one of the things they’re doing is predictive modeling—using historical data to make predictions about the future.

Today’s financial aid director wears many hats: counselor, manager of budgets, supervisor, implementer of regulations, and keeper of data, to name a few. As the role of financial aid director has become increasingly complex and challenging, so has filling this position. A job posting could read something like a hybrid circus performer: juggler/tight-rope walker/magician with excellent communication, supervisory and financial management skills, and at least five years of experience in financial aid.

Six months into the net price calculator (NPC) requirement, the experiences of many colleges and universities can be best described as “a mixed bag.” Questions or concerns that numerous schools expressed as they put together their plans for the NPC launch have not necessarily been answered: Will the phones start ringing off the hook? How accurate will comparisons be? What is the best location on our website: Should we highlight the NPC or bury it in a hard-to-find spot?

Given federal and state regulations­, especially now, there are many policies and procedures related to applying for, awarding, and disbursing aid that can’t be avoided. Still, in our travels, we often see aid offices making unnecessary extra work for themselves or students by clinging to outdated procedures or implementing policies for the entire student body because of concerns that impact only a select few. Scannell & Kurz has compiled this “hit list” of time—and money—wasting policies and procedures that should be reconsidered:

Increasingly, college and university leaders are recognizing that no undergraduate education is complete without exposure to cultures outside the United States. Therefore, many institutions are striving to create a more global experience for their students, through enrolling more international students, encouraging students to study or work abroad, setting up satellite campuses in other countries, or some combination of all three.

Student financial literacy has been a growing concern, not only because of the connection to persistence and retention, but also in terms of success beyond college years that includes repayment of student loans and general fiscal responsibility in adulthood. We’ve likely all heard the stories of the $82 pizza, its price inflated by a check that bounced and resulting fees from the bank and pizza parlor. It shows the need for students to understand the consequences of spending money they don’t have.