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Financial Aid

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Still, in our travels, we often see aid offices making unnecessary extra work for themselves or students by clinging to outdated procedures or implementing policies for the entire student body because of concerns that impact only a select few.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:

Student loan debt has been steadily rising for a number of years and has recently passed the $1 trillion mark, making it more than credit card debt. The issue has had attention all along, but there is more of a focus on it as recent graduates are having a hard time finding jobs that would enable them to repay those loans.

Are the financial aid award letters your institution sends to returning and prospective students clear, correct, complete, and comparable to other institutions’ award letters? The federal government thinks that too many are misleading and difficult to compare.

  • 360 Degrees of Financial Literacy: Free program from the American Institute of Certified Public Accountants to help Americans understand their personal finances through every stage of life
  • CashCourse: Free, noncommercial online educational materials from the National Endowment for Financial Education

With college costs still top of mind for most families, financial aid is more important than ever. Community college leaders are especially challenged to communicate the importance of the Free Application for Federal Student Aid (FAFSA) to their student body, which appears to be less likely to apply for federal aid. According to the report "FAFSA Completion Rates by Level and Control of Institution," 58 percent of Pell-eligible community college students applied for aid, compared to 77 percent of four-year students in the 2007-08 academic year.

Since the market crash of 2008, a number of private education lenders have left the marketplace. Those who have remained have not increased their lending to fill this gap and anecdotal evidence suggests that the remaining lenders have further reduced access to private education loans by tightening their credit criteria. Higher-education institutions have responded to the credit needs left unmet in the current marketplace by creating or revising their own institutional credit and payment arrangements.

financial aid

Complying with the growing and increasingly complex Title IV federal student aid regulations is an ongoing challenge for every campus that administers federal student aid. Performing a word count of student aid regulations in 2000 and 2010 reveals a 40 percent increase over that decade. A recent survey of financial aid administrators shows that increasing regulatory and compliance requirements are causing resource shortages in many financial aid offices.

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.

The tornadoes that ripped across the South in April devastated everything in their paths. Some institutions had to close their doors before semester’s end.

Future Shock

Darwin put it this way: "It is not the strongest of the species that survives, nor the most intelligent. It is the one that is the most adaptable to change." This simple truth in nature may best describe the evolution of the most nimble higher ed ownership models in the 21st century.