In an already difficult year for students looking to pursue an education, one factor weighed more than all others when choosing a school: financial aid.
Even in normal years, the choice of a college or university depends largely on the amount of financial aid offered and the distribution among grants, scholarships, work-study opportunities, and student loans.
In 2024, however, continued problems with the new federal financial aid application have increased the role of aid in college choice. Problems with the new form have delayed financial aid award letters and left some high school seniors struggling to apply for aid at all.
More than three-quarters (76%) of students said the amount of financial aid they received and the financial aid process in general were the most important factors in their college choice, according to a March survey by Ellucian and EMI Research Solutions.
This transcends the influence of parents, location, campus culture, and even the courses offered.
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“This year we are seeing greater concern about the cost of higher education than in recent years,” said Robert Franek, editor in chief of The Princeton Review, which recently ranks colleges based on how much financial aid is awarded“There is a palpable level of stress.”
Higher education already costs more than most families can afford, and college costs are still rising. Tuition and fees, plus room and board, for a four-year private university averaged $56,190 per year in the 2023-2024 school year; at four-year, in-state public universities, it was $24,030 per year, according to the College Board.
Experts predicted that there would be problems with the new Free Application for Federal Student Aid would weigh heavily on enrollments, although it was initially unclear what role it would play in decisions between schools.
Ellucian's research found that 44% of the 1,500 students surveyed said they would transfer schools if they received just $5,000 more in financial aid.
“It's a surprisingly small amount when you look at the total cost,” said Laura Ipsen, CEO of Ellucian, about the difference the prize money made in the decision-making process.
The Impact of the FAFSA on Decision Making
“It wasn’t just the financial aid, which is huge, but it was also comparing different offers that came in at different times,” said Eric Greenberg, president of Greenberg Educational Group, a consulting firm in New York. “It had a huge impact on the way people made decisions.”
In previous years, financial aid award letters were sent out at about the same time as the acceptance letters. This meant that students had several weeks to compare offers before National College Decision Day, the deadline for most admitted students to make a college choice.
Due to the long delays this year, some students will not receive their final financial aid letter until late August, the U.S. Department of Education said in a recent update.
That could mean some students will start their fall semester before they get any important information about how much it will cost. It also marks “the first acknowledgement” by the Department of Education that the FAFSA will not be fully operational until after the start of the 2024-2025 admissions year, which began July 1, said higher education expert Mark Kantrowitz.
“Time is of the essence when students are making decisions,” Ellucian's Ipsen said.
“The sooner you can get an offer into the hands of students, the more likely they are to accept it,” she said. And it’s not just whether they get into their favorite school, she added, but whether they get into college at all.
The FAFSA is still a hurdle
From June 21st, only 45% of incoming high school seniors have completed the FAFSA, according to the National College Attainment Network, or NCAN. A year ago, that number was 52 percent.
Filing a FAFSA is one of the best predictors of whether a high school senior will go to college, NCAN also found. High school seniors who complete the FAFSA are 84% more likely to enroll in college immediately after high school, according to a 2013 NCAN study.
The FAFSA serves as a gateway to all federal aid money, including loans, work-study programs, and grants. The latter form of aid is the most desirable, as it usually does not have to be repaid.
Greenberg advises the students he works with to explore as many other sources of merit-based aid as possible.
“A lot of people assume that only the most elite students get scholarships; that's not true at all,” he said. “We have students who go to private colleges for much less than they go to public colleges.”
