Another Look at Financial Wellness
Financial aid and graduation aren’t often linked together in conversations about higher education. However, a student’s success after graduation is closely tied to their approach and understanding of financial aid when they enter college.
Financial aid provides much-needed support and resources to help students further their higher education. For most students, it’s the only way they can afford the cost. But if it’s not managed properly, it can create a financial burden that can be difficult to cope with in the long term.
Fortunately, there are several ways that admissions and financial aid staff can ensure that college students have a clear understanding of financial aid and how to manage it effectively.
Starting Off on the Right Foot
A recent survey conducted by Trellis Company found that only 46% of college students have a basic understanding of financial aid and its associated costs. They also have limited skills related to managing money. This lack of financial literacy can lead to costly mistakes that impact a student’s ability to manage their finances after college.
The more a student knows about financial aid and personal finance in general, the more empowered they are when crafting their approach to paying for college.
And it’s incredibly important to start off on the right foot in their college journey—especially when it comes to finances. For admissions staff, ensuring that students have a solid plan to pay for their higher education is one of the best ways to foster positive post-graduation outcomes.
But what does this actually look like?
Step One: Simplify the Process
The first step in supporting students with financial aid is to provide financial clarity and transparency. Financial aid offices should make it easy for students to research the various types of assistance available. This includes grants, scholarships, loans, and work-study programs.
It’s also important for admissions staff and financial aid officers to understand the eligibility requirements for each type of aid, as well as the associated fees, deadlines, and repayment schedules. Their role is to be able to clearly communicate this information to students. It goes without saying but a good net price calculator can go a long way here, as they provide quick and accurate estimates of the total cost of attendance.
By simplifying this process for students, financial aid and admissions staff can help alleviate the stresses tied to paying for college. They can also empower students to leverage the most valuable opportunities available to them, whether through federal aid or institutional programs. They may be able to make suggestions around work-study programs or payment plans too.
Once again, it’s all about setting a foundation for students so they can craft an approach to paying for college. More specifically, it’s about helping them frame that approach so it fits their specific circumstances.
Step Two: Help Students Plan for Their Future
Financial aid officers must meet students where they are. This means that they should help students understand their own financial situation. This will have a huge impact on how they pay for college—and especially how they handle paying off loans post-graduation.
A student should understand their current income, expenses, and debt. Knowing their current financial situation will help them better manage their finances and use their financial aid. It’s also important for students to understand their financial goals in the long-term future and how their current financial aid fits into that plan.
This might mean financial aid officers start a conversation about student loan repayment—even as students are taking out those loans. This future thinking won’t just set up a student for success after they graduate. Once again, it will help alleviate stresses associated with finances while they’re still enrolled in their undergraduate program. Less stress means they can spend more time studying—and enjoying their time on campus.
Step Three: Focus on Career Development Early
Colleges and universities should also prioritize student success through career development. For example, Colleges of Distinction created career development programs that provide students with the guidance and resources they need to make informed decisions about how they pay for college. These programs provide students with one-on-one guidance, workshops, and online resources to help them better understand their financial aid options in higher education.
Another example comes from Augusta University’s Provost. He recently published research in the International Journal of Career Planning and Development that examined the importance of life and career planning for college students. His work found that having a clear understanding of financial aid and its associated costs can help students make informed decisions about their future during college enrollment.
In other words, students who are able to understand their financial aid options, as well as their individual financial situation, will be better prepared to manage their finances and achieve their goals after college.
And that’s the whole point of higher education, isn’t it? Students should leverage their education into a successful and fruitful career after they graduate. But they can’t do this without financial aid clarity.
Through research, helping students understand their own financial situation, and helping them take advantage of the resources available, admissions staff and financial aid officers can empower students to make informed decisions about their future. Having a clear understanding of financial aid will not only help students better manage their finances, but will also provide them with the tools and resources needed to achieve their goals after college.