Episode 38: Financial Aid and College Affordability

Episode 38 Transcript

• Episode 38 Transcript

  [INTRODUCTION]

  [00:00:06] BW: When I'm on the road, there's a lot of bumper stickers I see. There's the stick-figure families, those save-the-environment slogans, but there's one that never fails to catch my eye, and it's the one that says something like, “My kid and my money go to such and such University.”

  [00:00:22] BT: I've seen those bumper stickers too and, much like Bryan, can appreciate how real and honest that statement is. I'm Brooke Thames from Bucknell University and, in the spirit of being real, we wanted to bring you an episode of College Admissions Insider that's all about the truth behind college affordability.

  [00:00:39] BW: I'm Bryan Wendell, also from Bucknell. In this episode, we'll define need-based aid, we'll discuss how families should factor affordability into their college search and we'll try to dispel some misconceptions about college costs — all in the hopes of demystifying this crucial aspect of the college admissions process.

  [00:00:58] BT: Here to lend her expertise on the subject is Lisa Keegan, Bucknell’s vice president for enrollment management. Lisa has worked in higher education for over 15 years, with nearly a decade of that spent in enrollment management leadership roles. She's joined us before as a guest to discuss demonstrated interest. So welcome back to the podcast, Lisa.

  [00:01:17] LK: Thank you so much, Brooke and Bryan. It's great to be with you and our listeners.

  [INTERVIEW]

  [00:01:22] BW: Yeah, it's so good to have you. Let's get right into it. There's a lot of narratives out there about college affordability, especially regarding rising costs. I mean, we've seen the headlines. But I also know there's a lot of misconceptions, too. So are there a couple of myths about college affordability that we can kind of just dispel and knock out right from the top?

  [00:01:42] LK: Yeah, I appreciate that question. You're absolutely right, Bryan. Every year, it seems that there will be a headline questioning the value of higher education. And it'll say something like, “Is college worth it?” And I think it really starts to make families wonder more and more about that investment and can they afford it. I think it really plays into one of the myths, and the number one myth that I want to dispel on this episode is that, “I can't afford to go to college,” or, “I can't afford to go to a particular kind of college.” And so today, I'm hoping we'll have a chance to talk a little bit about how doing some research can really be beneficial in that college search process, and that there are affordable options out there for students and families.

  [00:02:31] BT: For sure. And knowing that affordability means different things for different students and families, how and when should it be considered in the college search process?

  [00:02:42] LK: I think it's such an important part of the college search process and an important conversation that families need to have. And if they have that conversation upfront at the beginning, it will make the search process a little bit easier. And the reason I say that is, what we don't want to have happen is that a student gets into their dream school, and it's late in the spring of their senior year, and they realize they can't afford it, right? Or that the family's not willing to pay the price, and they're having that conversation in April or May of the senior year. So having these conversations up front are really going to be beneficial for the entire family in the search process.

  Now, look, I understand it's easy for me to say that. There's nothing harder to talk about than money. And we certainly recognize that, for a lot of families, this is the first time they're going to be having sensitive conversations about finances with their children. But there are really two important questions that families should be thinking about as they're entering the search process, and it's about what they can pay realistically for college, and what are they willing to pay. We recognize that families are making difficult decisions. They may have one, or two, or three, or more children going to college. They might be overlapping at certain points. Families are making decisions about retirement and lots of other financial considerations. And so having some frank conversations up front will really help frame that search process for the student and the family, and, hopefully, not be having those difficult conversations so late in the search process.

  That said, one of the things we'll talk a little bit about today, though, is that you've got to dig a little bit further and be open minded at the beginning and get all the information and facts before you start crossing schools off your list because of the sticker price.

  [00:04:42] BW: I want to talk about that sticker price, because we see it in viewbooks, we see it on college websites. When you're researching a school, you're inevitably going to come across that sticker price as you dive even just past that first layer. So I have a couple of questions about that: How likely is it that a family's actually going to pay that price? And if the number isn't close, then why are colleges even motivated to share a sticker price at all?

  [00:05:10] LK: It's such a good question, and it's true, Bryan. We really don't want families to be scared off by that sticker price. But they do need to dig a little bit further for some additional information to understand what they might be expected to pay. And most schools, like Bucknell, will put right out on its financial aid website the percentage of students that are at Bucknell on financial aid. And that's a really great statistic for families to take a look at to understand how many students at that school are paying the sticker price and how many are receiving aid in some form. So, that's a great place to start. The other place that schools can be really transparent, is putting direct on their website the average debt loan that graduates have at the date of graduation. That's a really important piece of information for families to consider as they're thinking about that sticker price.

  [00:06:06] BT: Yeah, so you mentioned financial aid there for a second. I want to dig a little bit more into that, especially need-based aid, which differs from merit-based scholarships, which we covered a bit last episode. And so, for clarity, can we talk about what distinguishes need-based financial aid from merit-based?

  [00:06:22] LK: Thanks, Brooke, for that question. Merit aid doesn't consider a family's ability to pay for college, and it's often based on a student's talent or particular achievement. Need-based financial aid is distinguished from that because it's based on what a family is able to contribute to the cost of education. Need-based aid comes in many different forms. Institutions often set aside dollars institutional grants that they provide to students. There are grants available frequently through states and also through the federal government in the form of one that a lot of families have heard about: Pell Grants, for instance. Those are issued from the federal government. So a financial aid package can be made up of several different components, both grant dollars, loans, work-study. And again, that's all based on a family's ability to contribute to the cost of college.

  [00:07:25] BW: So the process behind all this can be — and I speak from experience here — can be very confusing. So I know one of the first steps is filling out the Free Application for Federal Student Aid, which everybody just calls FAFSA. What does the FAFSA exactly offer? What does it do? And where does it come into the process?

  [00:07:45] LK: Sure, Bryan. So the FAFSA is available, typically, beginning in October, and that's when families are going to want to start the process of completing that. So beginning in October of a student's senior year of high school. The FASFA provides access to those federal grant dollars that I just talked a little bit about, like the Pell Grant. Some other forms of loan eligibility, programs that are sponsored by the Department of Education. The FASFA also helps institutions though determine a family's ability to pay for college. In addition to the FASFA, many institutions also require another form called the CSS Profile. And that, too, is available to families in October. And I think this is just a great note: The earlier that families start this process, the easier it will be for them. Again, thinking early fall of that senior year for completing financial aid documents.

  [00:08:43] BW: And on that deadline, can I just clarify one thing? So if the FAFSA is available in October but your application deadline isn't until January, do those have to be done at the same time? Or can you go and get the FAFSA out of the way and get the CSS Profile done? And then focus on the application for admission?

  [00:09:01] LK: Yeah, absolutely. You can submit those early to institutions, and they'll hold them in your record until the application comes in. So yes, you do want to pay attention and be mindful of the deadlines, but they don't have to all be submitted at the same time. Great clarification question.

  [00:09:16] BT: So, we have the FAFSA and the CSS Profile. But I wonder, I mean, are there any other forms or deadlines that students need to be aware of, when seeking out and securing need-based aid?

  [00:09:29] LK: Some institutions will have their own aid forms as well, and this is an area where I wish I could say there’s standardization across all institutions. But, unfortunately, we all vary a little bit in this regard. So as students are considering the application deadline, just the general application for admission deadlines, they should also be mindful of institution’s financial aid deadlines. I'll just note here that schools release financial aid decisions differently. Some will release them with the acceptance pack, some will release them on a rolling basis and some will have a set deadline later in the spring where they release all of their financial aid packages.

  But, again, all of this information is really transparent through schools and institutions. But it is a great place to be tracking those deadlines and being really mindful of those. And, again, the earlier that families can submit financial aid documents, the better they'll be throughout that senior year.

  [00:10:28] BW: So with this whole episode, we've been trying to peel back the curtain on what's really an enigmatic topic. The challenge — and you alluded to this earlier, Lisa — is that with financial aid, everybody's situation is so specific. And so we can't answer really specific questions, I would imagine, because then you'd be coming up with 11,000 different answers, right? So where do people go for answers that are really only unique to them that aren't going to be in some sort of FAQs on a college's website?

  [00:10:59] LK: A great place to start is with high school guidance and college counselors. If students and families have access to resources within the school, those professionals are well versed in applying for financial aid and can certainly help families have conversations about college affordability. So I think that's a great place to start. There are also often community or school-sponsored events, particularly around the FASFA release. So there might be opportunities to go to your public library, or a community college campus, or even your high school and sit down and complete the FASFA with financial aid volunteers that are there to support you, and help you through that process, and answer your questions. So be on the lookout for those kinds of events. Those should be free, and they should be sponsored by financial-aid professionals. So just be mindful of that as you're moving through the process.

  Most importantly, the colleges themselves. There are financial aid specialists and counselors on hand at colleges and universities that can certainly answer very specific questions for families. And I think it's really important to note that those professionals are available to students throughout their college career. Family circumstances change, income changes, and students need to know that they have a resource during the college process that they can turn to to ask some really specific questions around specific situations.

  [00:12:31] BT: And in the case that circumstances do change, throughout a student's four years, is it possible that financial aid offerings might change along with those fluctuations?

  [00:12:41] LK: Certainly. There's always an opportunity for a college or university to review a student's financial aid eligibility. And frankly, the most often place that we see this is when a parent or guardian might lose a job or has a significant change in income. Those are cases where students should certainly reach out to their financial aid office and have a review of their circumstances. So absolutely, throughout those four years, there are opportunities for those case-by-case specific reviews.

  [00:13:13] BT: And so, with so much factoring into financial aid, are there resources available for students and families to figure out how much they can realistically afford as they're going through the admissions process?

  [00:13:25] LK: Yes, absolutely. So colleges and universities will publish on their financial aid websites various tools that families can utilize to calculate what they might be expected to pay at that institution. The Net Price Calculator is the one that is typically on every college and universities website, and others will offer another tool called MyinTuition, which allows families to just answer a couple of questions and get a good estimate of what they might be expected to pay at that school. I will say that the calculators are only as good as the inputs. So the most concise, and clear, and updated information that families can input will better the chances of getting a really, really solid estimate of costs.

  [00:14:13] BW: That's great to know that's there. It takes some of the guesswork out of it. You shouldn't be surprised when you get that financial aid award letter, you should be expecting pretty close to what you're going to get, I would imagine.

  So we started this episode talking about those headlines that say, “Is college worth it?” And so that naturally makes us think about ROI, return on investment. And we know — and, of course, we're biased — we know the answer is yes, it is worth it. But what resources are available for families to evaluate their return on investment for their student and their family? The money that they're going to put in is really going to pay dividends — how do they prove that for themselves?

  [00:14:51] LK: Every family and student is going to have to answer that question individually, right? But there are a couple of points of information that are available to them as they're considering that question. The first place I would say to look is outcomes data for an institution. What percentage of students who are getting jobs are going to graduate school right after graduation or within a year after graduation? And what kinds of places are they going? I think that's a really important follow up question — that you're not just asking, “Are students getting employed?”, but are they getting the kinds of jobs that they really want? Are they feeling prepared to go into the careers that they're choosing?

  The second question I think is really important to ask, though, too, is how long is it going to take me to achieve my degree? Is this an institution that graduates most of their students in four years? Am I going to be able to get the classes that I want to finish my major or my second major in four years, or five years, or six years? So is this a four-year investment or is it longer? Those are the kinds of questions I think are really helpful.

  The other thing I'll just note, too, though, that more and more students are graduating in three years, or three and a half years. So those might be some questions that you're asking colleges and universities as well. How many credits will they allow you to transfer in from your high school curriculum? Or is it a place that would take transfer credits from a community college, if that might be how you elect to start your college process? So, there are a couple of different ways to evaluate it and think about options to achieve a four-year degree.

  [00:16:26] BT: Yeah, there are so many tracks and different ways to take that journey to getting that college degree. And so, by this point in the episode, we know that affordability is a huge and complex piece of the college admissions process. But, Lisa, what's kind of the main message, if you had to sum it up, that you want students and families to walk away with?

  [00:16:47] LK: We could make this a two-hour podcast episode if we wanted to and provide all the information to families. We certainly aren't able to do that right now. This is a starting point, and I think the main takeaway from it is that there are resources to help families understand the cost and affordability of college and that affordability should be part of the search process. In doing research and finding answers, cost doesn't have to be a barrier in achieving a degree. I think that's the main takeaway from this particular episode.

  [00:17:24] BW: That's awesome. Look past the sticker price, do your research and ask questions. I love all that advice, and I think that's a great place to wrap up this episode of College Admissions Insider. So, Lisa Keegan, thanks so much for joining us and sharing some of your great insight.

  [00:17:39] LK: Thanks so much for having me.

  [00:17:42] BT: And we thank all of you out there for listening as well. If you are a fan of the podcast, please take a moment to rate, subscribe and share this episode with anyone you know who's navigating the financial aid journey.

  [00:17:52] BW: We'll be back with another new episode of College Admissions Insider in two weeks. In the meantime, contact us by email at podcast@bucknell.edu. We love to read your questions, comments and episode ideas.

  [00:18:06] BT: You're also invited to follow Bucknell on all of your favorite social media apps. Just look for @bucknellu on Instagram, Facebook, Twitter, YouTube and TikTok. You can also follow our student-run Instagram account, which is @iamraybucknell.

  [00:18:19] BW: Until next time, keep on reaching for your dreams and your dream school.

  [END]