National Student Financial Aid Profile Finds Dramatic Increase in Need
- By Dian Schaffhauser
The number of students applying for federal financial aid grew 62 percent over five years, from 19 million in 2007-2008 to 31
million in 2011-2012. As Congress debates reauthorization of the Higher Education Act, a national organization of financial aid professionals
has issued its latest "National Student Aid
Profile" to help policymakers understand what they're making decisions about.
The annual primer published by the National Association of Student Financial Aid
Administrators (NASFAA) provides overviews of six 2015 federal programs for delivering financial aid to American college students:
- Federal Pell Grant;
- Federal Supplemental Educational Opportunity Grant (FSEOG);
- Federal Work-Study;
- Federal Perkins Loan;
- Federal Direct Subsidized and Unsubsidized Loan; and
- Direct PLUS Loan.
In terms of people served, the largest of these is the first program on the list. Federal Pell grants are available to low-income
undergraduates who haven't yet earned a bachelor's degree. In 2012-2013 9.4 million recipients received Pell grants. Almost three-quarters had
family income of less than $30,000. In 2015-2016, the maximum award will be $5,775; the minimum award will be $577. The volume of awards issued
in 2013-2014 was $35 billion.
The largest award by average size fell into the Direct PLUS Loan program. These loans go to parents of dependent undergraduates or directly
to graduate and professional students. In 2013-2014, the average loan was $14,174 for parent borrowers and $21,849 for graduate and
professional students. The loans are provided regardless of income, but borrowers still have to pass a credit check or find a co-signer. The
total of loans issued under Direct PLUS was $17.5 billion in 2013-2014.
The form of financial aid most at risk right now, the report noted, is the Perkins loan program, which will expire if Congress doesn't enact
new legislation by September 30, 2015. Under this program, students receive loans directly from their college or university, and they're repaid
with an interest rate of five percent per year, which begins to accrue after the student has graduated. President Obama has proposed a new form
for the Perkins loan to increase the number of schools that participate and to make the loans unsubsidized with market-based interest rates.
Overall, however, given the fiscal environment of austerity and sequestration, the report noted, the 2015-2016 federal student aid programs
"fared relatively well in the budget process, with some programs even receiving modest increases." For example, the Federal Work-Study Program
spending package saw a $15 million increase, a "small but welcome boost."
"Strong federal student aid programs are more important than ever in ensuring students have the funding they need to make it to and through
college," said NASFAA President Justin Draeger in a prepared statement. "With debate heating up on reauthorization of the Higher Education Act,
NASFAA's National Student Aid Profile is a reference policymakers and the public can rely on to familiarize themselves with the purpose and
utilization of student aid programs as we work together to provide students access to college."
Dian Schaffhauser is a senior contributing editor for 1105 Media's education publications THE Journal and Campus Technology. She can be reached at email@example.com or on Twitter @schaffhauser.