College cost and access have become a key issue this election cycle, with candidates talking openly about subsidizing some or all of a public college education. But there are numerous complexities beyond just cost that deter students from enrolling in college and succeeding. The difficulty of navigating our financial aid system makes it difficult for students to get to and through college. Thankfully, there are achievable steps we can take to significantly simplify and improve the process for students and families.
1. A simpler application
We need to further simplify the application process. We’ve made significant strides in recent years in streamlining the Free Application for Federal Student Aid and a recent change announced by President Obama makes the application available, effective Oct. 1. This means students will be able to gain an earlier, more accurate understanding of how much aid they qualify to receive.
And more can be done: the next step in simplification will be to use existing federal databases to identify low-income families up front, so that poor kids don’t have to keep proving they are poor to multiple federal agencies. For example, a student whose family already receives Temporary Assistance for Needy Families should be made automatically eligible for Pell Grants.
2. Support financial planning
We can simplify the planning process for families by providing multi-year funding for student aid programs and college appropriations so schools can, in turn, provide students with multi-year estimates on their financial aid awards. Today, the largest payers of higher education — federal and state government — do a poor job of providing colleges with stable funding from year to year.
Periodic government shutdowns and annual budget impasses make it nearly impossible for colleges to give students an accurate estimate of what four years at their institution will ultimately cost. Simply put, students need a simple, predictable and comprehensive picture of the total costs of their educational program, up front.
3. Make payments easier
We can do more to simplify the student aid programs themselves, particularly related to student loan repayment. Today’s students are drowning in a sea of potential repayment plan options — nine at last count. Yet even with all of these lifelines, nearly 15 percent of federal student loan borrowers default within three years of leaving school. We can and must pare the number of repayment options down to just a couple that actually work for students and offer flexibility. Other complexities such as student loan origination fees and various ever-changing interest rates also create unnecessary hurdles for students.
Simplifying student financial aid is not without its challenges, but it’s certainly not impossible. By simplifying the application process, the funding mechanisms and the rules governing financial aid programs, we can remove barriers to college and help promote the next generation of critical thinkers and problem solvers. We hope schools and students will be key stakeholders this process.
Justin Draeger, President, National Association of Student Financial Aid Administrators, [email protected]