The National College Access Network Friday launched a national campaign to encourage high school seniors to complete the Free Application for Federal Student Aid.
The campaign, Form Your Future, is focusing on low-income and minority students -- those least likely to apply for financial aid but most likely to benefit from it.
"Their award might affect their decision to attend college and, ultimately, change the course of their career," said NCAN Executive Director Kim Cook.
U.S. Department of Education data shows that 92 percent of students with household income less than $50,000 received a Pell Grant in 2016-17, according to a release from NCAN. But less than half of high school seniors complete the FAFSA before graduation. The Form Your Future campaign will partner with celebrities and social media personalities to reach students where they are already engaged.
The White House -- together with the website College Humor -- released a video featuring Michelle Obama that tries to show how silly it is not to fill out the FAFSA.
The benefits of higher education are well established: a significant boost in average earnings, a higher likelihood of employment, increased productivity, greater tax revenues, lower crime. But much debate continues on how best to encourage more students to make high-quality educational investments and how to ensure that a degree is affordable. As the Obama administration welcomes its final back-to-school season, the opportunity arises to look back and assess the impact of its higher education policies and next steps to build on that progress.
A new Council of Economic Advisers report released yesterday examines the administration’s record, finding that evidence-based policies implemented over the last seven years have already begun to pay off. Investments in greater financial aid, in particular, have had high returns. The Council of Economic Advisers estimates that the administration’s increase in the average Pell Grant award between 2008-09 and 2014-15 will lead to an additional $20 billion in aggregate earnings, a nearly two-to-one return on the investment.
But that is only one example. Without federal support, much of the potential benefit of higher education would go unrealized due to misalignments between individual and societal benefits, credit constraints, information failures, and procedural complexities. Since taking office, the Obama administration has worked to address each of these areas so that more students can attend a quality higher education institution, graduate and repay their loans on manageable terms.
From the very beginning of the college selection process, students can face obstacles; even determining which colleges will provide a good return on investment is a daunting challenge. That is why the administration unveiled a redesigned College Scorecard offering the most reliable and comprehensive data ever published on students’ outcomes at individual institutions, including data on cost, graduation rates, earnings, debt and repayment.
At the same time, even with solid information, procedural complexities may prevent some students from using the resources available to them. To help make it easier for them to apply for student aid, the administration has made the Free Application for Federal Student Aid simpler by reducing the number of questions it presents and making it easier for applicants to directly transfer data from the IRS. In addition, the FAFSA is available earlier this fall, improving the information students have about their financial aid packages when they make decisions about where to apply.
Once accepted, students must also determine how to pay for their education. Research shows that lower college costs can improve college access and success, and the administration has made it a priority since day one to help families finance investments in education. President Obama has worked aggressively to increase the maximum Pell Grant award by $1,000, and, for the first time, tied the maximum amount of the award to inflation. This investment will help an additional 250,000 students access or complete college. On average, Pell Grants reduce the cost of college by $3,700 for eight million students a year. In addition, this administration has also established the American Opportunity Tax Credit, which will cut taxes by over $1,800, on average, for nearly 10 million families in 2016, thus giving students and their families more discretionary income to invest in college.
Despite these successful investments, too many people still feel as if college is out of reach. That’s why President Obama announced his America’s College Promise proposal in January 2015 to create a new partnership with the states that would make two years of community college free for hardworking, responsible students. Since the president’s announcement, over 36 free community college initiatives have been launched in states, cities and communities nationwide. Altogether, these programs raise more than $150 million in new public and private investments, supporting at least 180,000 students.
President Obama has also signed key policies into law to maintain the accessibility and affordability of student loans. Research suggests that without access to federal student loans, financially constrained students would be less likely to attend college, more likely to work while in school, and less likely to complete a degree. In 2010, President Obama signed student loan reform into law, generating over $60 billion in savings and redirecting that money back to students and taxpayers. And in 2013, he signed into law further reforms to lower interest rates for nearly 11 million borrowers.
Additionally, the president’s Pay As You Earn and related income-driven repayment plans have allowed approximately 5.5 million student borrowers to cap their monthly student loan payments at rates as low as 10 percent of discretionary income, to ensure their debt is manageable. These plans better align the timing of loan payments with the timing of earnings benefits by allowing borrowers to make smaller payments when their earnings are low or during transitory periods of financial hardship and to adjust their payments as their earnings grow.
Finally, this administration has worked to protect students from unscrupulous institutions that do not deliver a quality education. The U.S. Department of Education’s gainful employment rules will hold career colleges accountable by removing poorly performing programs’ access to federal financial aid. Such rules build on a record of action by this administration to increase accountability in higher education. The department has also created a Student Aid Enforcement Unit to respond more quickly and efficiently to allegations of illegal actions by higher education institutions.
Though more work remains, these policies taken together represent a significant step forward in building an educational system that encourages all Americans who wish to invest in an affordable, high-quality college education to do so. Colleges and others in the higher education community can build on that progress by encouraging students to fill out the new early FAFSA so that they can learn about and access the student aid dollars that are so critical to their future.
Sandra Black is a member of the Council of Economic Advisers. Jason Furman is chairman of the Council of Economic Advisers.
The rate at which student loan borrowers defaulted on debt taken out to attend college dropped for the second consecutive year, although the Department of Education says significant work remains on the issue.
Of the 5.2 million student borrowers who entered repayment in the 2013 fiscal year, 11.3 percent had defaulted on their federal student loans within a three-year period, the department announced Wednesday. That was a slight decline from the 11.8 percent default rate reported for the previous cohort and the 14.7 percent rate two years prior.
Student loan borrowers default on a loan when they haven’t made a payment in at least 360 days.
Despite significant growth in enrollment in income-driven repayment plans, the year-to-year drop-off in the cohort default rate was modest. The administration has also increased the amount of the maximum Pell Grant, cut student loan interest rates and simplified the process for applying for federal student aid.
“The Obama administration has taken unprecedented measures to provide borrowers more options to avoid default, manage their student debt and stay on track to repayment, and to hold institutions accountable for improving student outcomes,” said Education Secretary John King Jr. in a statement. “Even with progress, however, we know considerable work remains ahead.”
Submitted by Paul Fain on September 29, 2016 - 3:00am
A new report from the Century Foundation criticizes student loan guaranty agencies, arguing that they largely have abandoned their public missions. The report said the nonprofit guaranty agencies' collective $5 billion in funds could be used more productively and appropriately. Inside Higher Ed will publish a news article on the report's findings tomorrow.
A new report from Generation Progress and the Center for American Progress finds remedial education can cost students approximately $1.3 billion annually.
The report details that students enrolled in these courses typically don't receive college credit and are less likely to graduate. In 30 states, the remediation rate for English, math or both is between 40 percent and 60 percent for first-year college students.
Other highlights from the report break down the cost and rate of remediation in each state. For example, Florida has the highest remediation rate in the country, at 93 percent for first-time students enrolled in courses in 2013. Nevada and Arizona have similar significant immigrant populations, but there is a wide variation in the percentage of students taking remedial courses -- 85 percent and 40 percent, respectively, according to the report.
"For many student loan borrowers, their struggle with student debt begins even before they enroll in college," said Maggie Thompson, executive director of Generation Progress, in a news release. "The United States' current K-12 system isn't preparing all students for success, especially low-income students and students of color."
The report recommends states maintain a commitment to rigorous academic standards at the K-12 level by retaining or adopting the Common Core State Standards and for K-12 and higher education institutions to mutually define remediation and placement.
Submitted by Paul Fain on September 28, 2016 - 3:00am
More parents are saving money for college, according to the latest installment of a national survey conducted by Sallie Mae, the student lender. They're also saving more money and are more confident about their ability to pay for college, the survey found. For example, 55 percent of parents say they are confident they can meet the future price of their children's college education, up from 42 percent last year. Parents on average have saved $6,000 more for college, with an average of $16,380, compared to $10,040 last year.
Millennial parents (defined as age 35 or younger) are more committed to saving for college. The survey found that more millennial parents are saving more for college than their Generation X and baby boomer peers. They also are more likely to say that parents should be solely responsible for paying for college (38 percent of the survey's respondents) compared to 26 percent of Gen Xers and 18 percent of baby boomers.
Submitted by Paul Fain on September 26, 2016 - 3:00am
Military and veteran students who attend colleges that are accredited by the Accrediting Council of Independent Colleges and Schools (ACICS) should be able to continue receiving Post-9/11 GI Bill benefits to attend those institutions, at least for another 18 months.
The U.S. Department of Education last week said it would back a federal panel's decision to eliminate ACICS, a national accreditor that oversees 245 colleges that collectively enroll roughly 600,000 students. The accreditor also is the gatekeeper for federal aid at 700 GI Bill-approved programs, the U.S. Department of Veterans Affairs said last week in an email to students who are enrolled in those programs. However, the U.S. Congress has passed legislation to allow GI Bill recipients to continue attending ACICS-accredited colleges. President Obama is expected to sign the legislation.
"At this point nothing changes for you for at least the next 18 months," said Curtis Coy, deputy under secretary for economic opportunity at the VA, in the email to students. "We would, however, suggest you may want to re-evaluate your educational goals and decide that your current school and program will either meet your need for the next 18 months or that you may want to consider other options, courses and/or schools."
Submitted by Paul Fain on September 23, 2016 - 3:00am
The U.S. Department of Education on Thursday backed a federal panel's recommendation to terminate recognition of the Accrediting Council for Independent Colleges and Schools, a national accreditor that oversees many for-profit colleges. If enacted, the decision would mean that ACICS would no longer be a gatekeeper to federal aid for 245 member colleges, which collectively enroll 600,000 students. Last year the council oversaw the disbursement of $4.76 billion in federal financial aid.
The federal panel in June voted to terminate the accreditor, bolstered by a department report that found ACICS was too lax and inconsistent in its oversight. The collapsed Corinthian Colleges and ITT Technical Institute chains were ACICS members, among other controversial and failed for-profits.
The accreditor said it plans to appeal the decision. After the outcome of an appeal -- and a possible legal challenge -- is determined, ACICS's member colleges would have 18 months to find a new accreditor. Those that fail to do so would lose access to federal financial aid.