Financial aid timing, clarity shape enrollment decisions (2024)

Financial aid timing, clarity shape enrollment decisions (1)

How and when colleges communicate about financial aid can play a big role in students’ college-going decisions, according to a new report.

Photo illustration by Justin Morrison/Inside Higher Ed | Getty Images

For most prospective college students, the amount of financial aid they receive is one of the most important—if not the most important—factor in choosing where to attend. According to a new survey from Ellucian, an educational technology company, 76percent of students said their financial aid award helped them determine where they enrolled, and 44percent said they’d switch their top choice institution if they received $5,000 more from another college.

But it’s not just a dollar amount that can affect enrollment decisions; it’s also the time it takes to receive an offer and how transparent that offer is about the full cost of a degree.

The report is based on a survey of 1,500 students, 58percent of whom are working adult students and 42percent of whom are traditional-age students. Twenty-twopercent of respondents said they would choose a different institution if the paperwork processing at one took more than two weeks, 73percent said they’d move on if it took over a month and 92percent would look elsewhere if processing took eight weeks.

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Kim Cook, president of the National College Attainment Network, said the findings illustrate the importance of demonstrating affordability, not only for colleges’ own enrollment efforts, but also for the broader mission of equitable college access.

“That demand for a two-week processing turnaround just shows how anxious students can be about their ability to afford [college],” she said. “Early messaging is essential in assuaging those concerns and boosting confidence.”

The finding is especially relevant after this year’s chaotic financial aid cycle, in which processing was delayed by weeks or months in some cases due to the disastrous rollout of the new Free Application for Federal Student Aid. That meant many students didn’t receive their aid offers until months after submitting the form; for anyone who submitted a form before May, processing likely took even longer than eight weeks at colleges that don’t use the FAFSA alternative, the College Scholarship Service Profile.

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“It’s not that the stress of financial aid is anything new,” Ellucian CEO Laura Ipsen told Inside Higher Ed. “It’s just that the continued complexity, the amount of time it takes to get clarity, is even more difficult for students.”

The report also emphasized the extent to which prospective college students rely on adequate aid to make higher education feasible. More than half of respondents said they often had to choose between paying tuition and fees and affording basic needs like food and clothing.

Cook said those are the students for whom seamless, timely and clear financial aid offers and communications are most important.

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“For many of the underprivileged students we serve, it’s not that financial aid offers influence where they go, but if they go at all,” she said.

A Sales Pitch in a Storm

The report also showed that students care about a college financial aid office’s accessibility and support infrastructure when parsing their financial aid offers. Forty-fourpercent of respondents said they would hang up after 15 minutes on hold on a college’s help line, and 83percent said they valued having 24-7 access to support. This year, colleges and state aid agencies were swamped with calls from concerned families and counselors dealing with the new FAFSA.

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“It’s not just ‘Am I going to get the financial aid I need?’” Ipsen said. “The report showed that students are also basing their decisions on ‘What’s my digital experience with this institution?’”

Ellucian, not coincidentally, is in the business of enhancing students’ “digital experience.” The educational technology company owns Banner, one of the most popular financial aid software products in the U.S., along with a large portfolio of educational technology products for financial aid officers and enrollment managers. The new report advertises several of those products as solutions to financial aid–related enrollment struggles, including an AI-powered 24-7 financial aid adviser and a personalized net price calculator.

Cook said that because of Ellucian’s obvious business stake, the report’s findings, while interesting, should be taken with a grain of salt.

“They’re clearly selling things with this report,” she said. “I don’t want to stump for this company.”

Ipsen believes that in the wake of the FAFSA fiasco, the demand for technological solutions to financial aid frustrations is higher than ever among families as well as institutional leaders. Ellucian, she said, is only trying to help provide solutions for pressing problems.

“Creating these tools that take the burden off of these manual processes and delays and that can be more predictive and more communicative 24-7 to students, that’s important,” she said. “Now with AI, we have a virtual adviser that will ramp up these capabilities even faster for institutions.”

Cook agreed that extended processing delays this year have alerted more colleges to the importance of demonstrating their own affordability quickly and clearly. But she said the best way to do that is by staffing up critically overburdened financial aid offices hurt by workforce shortages across higher ed—a problem only exacerbated by this year’s FAFSA challenges.

“I understand why we’re looking for ways to leverage technology to solve these problems,” Cook said. “But the ideal scenario is that people are providing this support.”

Financial aid timing, clarity shape enrollment decisions (2024)

FAQs

What disqualifies you from getting financial aid? ›

Individuals who owe a refund on a grant made by a federal student aid program under Title IV of the Higher Education Act; Individuals in default on a Title IV loan; Individuals incarcerated in prison; and. Individuals convicted of possessing or selling illegal drugs.

How much money does the average person get from FAFSA? ›

The majority of students awarded financial aid received federal grants. The average federal grant award for undergraduate students has more than doubled to $8,890 in 2022 from $4,335 in 2001. Student aid estimates for 2022-2023 show that average federal grant aid has increased to $10,677.

What is the lowest GPA for financial aid? ›

To be eligible for federal student aid and college financial aid, a student must be making Satisfactory Academic Progress (SAP). This generally consists of maintaining at least a 2.0 GPA on a 4.0 scale (i.e., at least a C average) and passing enough classes with progress toward a degree.

Will I get financial aid if my parents make over 100k? ›

Don't worry, this is a common question for many students. The good news is that the Department of Education doesn't have an official income cutoff to qualify for federal financial aid. So, even if you think your parents' income is too high, it's still worth applying (plus, it's free to apply).

What is the highest income to qualify for financial aid? ›

There is no set income limit for eligibility to qualify for financial aid through. You'll need to fill out the FAFSA every year to see what you qualify for at your college. It's important to make sure you fill out the FAFSA as quickly as possible once it opens for the following school year.

What would disqualify someone from financial aid? ›

Other reasons for financial aid disqualification include: Not maintaining satisfactory progress at your college or degree program. Not filling out the FAFSA each year you are enrolled in school. Defaulting on a student loan.

What's the most money FAFSA gives? ›

Federal financial aid limits
Maximum amount (2023-24)
Direct Subsidized Loan$3,500 to $5,500 per year, depending on year in school
Direct Unsubsidized Loan$5,500 to $20,500 per year, depending on year in school and dependency status
Direct PLUS LoanTotal cost of attendance (net of other financial assistance received)
5 more rows
Apr 8, 2024

What is the maximum FAFSA payout? ›

Average and maximum financial aid
Type of AidAverage AmountMaximum Amount (2024-25)
Federal Supplemental Educational Opportunity Grant$670$4,000
Total Federal Student Aid$13,120 (dependent) $14,950 (independent)$20,895 to $22,895 (dependent) $24,895 to $27,895 (independent)
Total Federal Grants$4,980$11,395
3 more rows

Who gets the most financial aid? ›

The federal government is most likely to award grants to students attending private, for-profit colleges, with 67% of students at these institutions receiving federal grants. In total, the federal government distributes $6.4 billion in grant money among 56% of college students nationwide.

What GPA do you need to keep Pell Grant? ›

The Pell Grant has no minimum GPA; it is a purely need-based grant! That means that as long as you demonstrate need through the FAFSA and have gained admission to a college, you will qualify.

Will I lose my FAFSA if I fail a class? ›

Failing one class does not mean you'll automatically lose access to federal financial aid. But these funds do have academic eligibility requirements, as outlined in your school's satisfactory academic progress (SAP) guidelines.

Can I get FAFSA with a 2.5 GPA? ›

The Satisfactory Academic Progress regulations require that you maintain a minimum cumulative grade point average (GPA) in order to remain eligible for financial aid. This cumulative grade point average is 2.0 on a 4.0 scale. If you drop below a cumulative GPA of 2.0, you will be placed on a financial aid Warning.

At what age do colleges stop looking at parents' income? ›

Declare Yourself Independent for Financial Aid. A student age 24 or older by Dec. 31 of the award year is considered independent for federal financial aid purposes.

Can my parents make too much money so I won t qualify for aid? ›

Myth 1: My Parents Make Too Much Money, So I Won't Qualify for Financial Aid. Don't make assumptions! There is no income cutoff to qualify for federal student aid, and many factors besides income are considered.

Does FAFSA check your bank account? ›

Students selected for verification of their FAFSA form may wonder, “Does FAFSA check your bank accounts?” FAFSA does not directly view the student's or parent's bank accounts.

What makes you not eligible for financial aid? ›

Students must be in good academic standing to receive federal aid. The required GPA varies from school to school, but typically students need a 2.0 or higher. If your grades fall below the minimum GPA, you could lose eligibility for financial aid. See also: What GPA do you need to get a full scholarship?

Why would I be denied financial aid? ›

There are a few common reasons why the Federal Processor will reject an application: Missing signatures, inconsistent marital status with income, taxes paid are equal to or higher than adjusted gross income, citizenship questions are blank, marital status and family members blank, etc.

What income makes you ineligible for financial aid? ›

What Is the Maximum Income to Qualify for the FAFSA? There is no maximum income you can have for the FAFSA. Whether you're the richest person in the country or have an annual income of $0, you can submit the FAFSA.

What disqualifies you from a Pell Grant? ›

Once you have earned a baccalaureate degree or your first professional degree, or have used up all 12 semesters of your eligibility, you are no longer eligible to receive a Pell Grant. Additionally, you will not be eligible for a Maximum Pell Grant under these special criteria once you turn 33 years old.

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