FINANCIAL AID Who Do They Serve?

THE FOLLOWING BLOG WAS ORIGINALLY POSTED BY socioeconomic and class issues in higher education ON OCTOBER 31, 2016. LEARN MORE AND ENGAGE WITH OUR 30 VIBRANT KNOWLEDGE COMMUNITIES HERE.

Access to financial aid has long been lauded as the cure to many obstacles in a student’s collegiate life. Indeed, conventional higher education wisdom tells us that access to financial aid is the great equalizer for students as they pursue the academic degree of their choosing - but is it actually? While financial aid is a critical lifeline for many students who would otherwise not be able to afford college, it can sometimes also be a source of inequity.

Financial aid policies often disproportionately impact students from low-income and working class backgrounds. For example, delays in federal student loan disbursement (and at some institutions, Pell grant distribution) may put many students at risk of being penalized for not making payments on time (Campbell, Deil-Amen, and Rios-Aguilar, 2015). This type of problem becomes compounded when institutions place registration holds on students who have remaining outstanding balances on their account. While usually well-intentioned, these all too common practices place unfair burdens on students from poor and working class backgrounds.

The way we talk about financial aid can also be troubling. Institutions ubiquitously explain financial aid as a means to success in college. While this is often true in regards to higher persistence and graduation rates, this isn’t always true of other important student outcomes (Park, Denson, and Johnson, 2014). Furthermore, the success that institutions market to students is experienced disproportionately more by wealthier students and not those who require financial aid the most. Perhaps the most concerning example of this is the rise in merit-based aid. With a growing sense of competition between institutions, there is a palpable shift in how financial aid is being marketed. Where it has historically been something students “deserve,” it has since moved toward something that students can “achieve.” Where this can be a deciding factor in which institution of higher education wealthier students attend, it can often be the deciding factor in whether poor and working class students attend college at all.

Progress in providing equitable borrowing policies remains slow. To be sure, students today have greater access to loans than in most of higher education history. However, it is worth considering how students use that access. As it turns out, poor and working class students generally take out loans less frequently (and for fewer amounts) than middle- and upper-class students (Zerguera, McGowan, & Ferguson, 2016). Many low-income students are forced to learn how to operate within tight budgets, so it should not come as a surprise to learn that this necessity persists and translates into minimal loan borrowing.

Similarly, it should not surprise us to learn that fewer students are defaulting on loansafter leaving college. If those who are deemed “least able” to pay those loans back are accepting fewer loans, it would stand to reason that those who are deemed “most able” to pay loans indeed are paying them off. This news may be cause for a political celebration, but it is not a cause to celebrate for change agents seeking greater equity. We have seen what happens when financial aid policies incentivize institutions to broaden its horizons to wealthier, high-achieving students, but what message does it send to poor and working class students when our policies do not consider their needs?

If institutions of higher education are serious about creating economic diversity on campuses, then perhaps it starts with applying pressure to institutional administrators to lobby their respective state and federal legislators to pursue flex interest rates that accommodate poor and working class borrower repayment.

Perhaps a more immediately achievable goal for student affairs professionals would be to take a critical look at how individual departmental or office practices perpetuate classism. Do your Residence Life departments require non-refundable housing deposits? Do your conduct offices fine students for policy violations? How are your specific units specifically working to broaden access to students? If this isn’t a priority, consider making it one.

If merit-based aid actively excludes poor and working class students, then perhaps student affairs professionals can pick up the slack by collaborating with faculty and staff to create high impact practices for poor and working class students - most notably, internships and research opportunities. Employers and faculty are not the only ones who can offer internships and research projects, so make it a point to include poor and working class students in these professional development opportunities.

By advocating for economic equity, lowering economic barriers and creating development opportunities, student affairs professionals can begin to dismantle institutionalized inequity and to bridge the monetary and class gap that poor and working class students have experienced for so long.

References

Campbell, C. A., Deil-Amen, R., & Rios-Aguilar, C. (2015). Do financial aid policies unintentionally punish the poor, and what can we do about it?. In Erin L. C. (Ed.) Understanding equity in community college practice (New Directions for Community Colleges No. 172, pp. 67-76). San Francisco, CA: Wiley Periodicals, Inc.

Park, J.J., Denson, N., & Johnson, M. (2014). Journal of College Student Development,55(8), 779-794. doi: 10.1353/csd.2014.0086.

Zerquera, D.D., McGowan, B.L., & Ferguson, T.L. (2016). Yes, no, maybe so: College students' attitudes regarding debt. Journal of College Student Development, 57(5), 609-613. doi: 10.1353/csd.2016.0067.