8 Minutes to College

Somebody may have figured out how to hit the “easy” button on applying for financial aid for college. This could have a big impact on college enrollment of the lower-income students who are most likely to miss out on a college education due to cost.

The complexity of acquiring aid presents an significant obstacle limiting postsecondary access. To receive federally funded grants, as well as loans, students must fill out the Federal Applications for Student Financial Aid (or FAFSA). To determine eligibility, students must answer over 150 highly detailed questions about their family’s financial situations, many of which are inconsequential to the calculation of their final award, with little certainty about what their effort will yield. As a result, many students simply don’t apply. For example, over 30 percent of full-time community college students from families with annual incomes under $50,000 did not complete the FAFSA. Since student on the lower-end of the income scale are most likely to be eligible for aid, failure to apply can result in leaving substantial sums on the table. In the 2003-2004 school year, 1.5 million students who likely would have been eligible for Pell grants did not file the FAFSA, which was worth a maximum of over $4,000 at that time.

Since about 75 percent of information necessary to fill out the FAFSA is included in most family’s tax forms, some researchers asked the question, “what would happen if we offered families who were already receiving help prepare their taxes also prepare their FAFSA?” The answer: more kids will go to college. High school seniors whose parents received the FAFSA assistance and additional information were 8 percentage points more likely to complete two years of college than those that didn’t (28 percent v. 36 percent).  That’s a small investment with a big pay off.