Demystifying Financial Aid for Parents and Students
As we approach acceptance season, most schools will confront the same quandaries they face every year: how do we court our accepted students away from competing schools and bring them to enroll? And how do we do it without spending an excessive amount of financial aid money beyond our initial calculations? Before your team begins its preparations to forge ahead with tactics you’ve used in the past, we’d like to share a story with you about how one school drastically changed their approach to acceptance packages by confronting student’s and their parents’ confusion about financial aid head on. Ultimately, their revised approach saved their staff time and their bursar money, and allowed them to reach and exceed their enrollment goals weeks earlier than in previous years.
“At Western Connecticut State University, this past year we moved from traditional, computer generated, letter-style award notifications requiring a mail back reply, to an earlier-released, full-color, personalized “slick” piece incorporating not only the specific student’s financial aid award, but also detailed information about the award, definitions of terms used, explanations of alternative loan options and more. The result was surprising. We initially thought we’d get a rush of students responding or calling the office for clarification, however, we soon realized that that wasn’t exactly the case. After calling the students who were packaged but hadn’t yet responded, and arming ourselves with a pot of cash that we could use to perhaps sweeten the deal by a few hundred dollars if we needed to, the answers from the phone calls were overwhelmingly positive. Out of the nearly 1,000 students we called, we only spent an additional $2,000 on more aid. What had happened, for the first time in our history, not only had they had received them, but they were impressed with the packages, and told us they ‘were just waiting for the other colleges’ packages to come through.’ We were thrilled to hear that, and believe it was as a result of not only being more aggressive with getting our packages out ahead of our traditionally competitive schools, but also making them more appealing and in the end, clearer for both students and parents.”
– Jason Davis, WSCU Marketing Strategist
In this anecdote, silence is literally golden—by anticipating questions and concerns and frontloading acceptance materials with clear information, WCSU reduced the amount of secondary award money required to entice enrollees in addition to reducing the number of time-draining explicative phone calls from confused parents. If there is one takeaway from Mr. Davis’s story, it is this: parents have a real anxiety about understanding financial aid, and a strategy that effectively accounts for this anxiety increases enrollment and decreases sweetener payout. That strategy? Clarity. Open communication diffused questions and allowed for happier parents and easier enrollment experiences.
To recap, the key components of WSCU’s acceptance/financial aid package included:
A brochure packet explaining, in depth, the award breakdown & requirements
(as opposed to a shorter form letter)
Attractive, colorful print
(as opposed to traditional black and white)
Personalization in awards determination
(as opposed to generalization)
Earlier send date
Extensive explanation of award terms
(as opposed to space-saving or purposely vague curtailing of terms)
Precise award amounts with total package calculation
(as opposed to unawarded ‘award eligibility’ alerts and obscuring total package)
As stated, this strategy stands against most traditional presentations of this information in the form of an official letter. The formatting difference, in and of itself, is enough to make the package noteworthy. Still, the content—clear, personalized details about concrete award amounts—is what makes this package such a drastic reimagining of how to present vital information in a way that is beneficial for both parents and students.
For a variety of reasons, many schools favor a strategy that avoids explicit descriptions in award announcements. The most prevalent reason indicated in Mr. Davis’s accounting is that in followup calls, families indicated that they were ‘waiting for other schools’ packages to come through’. It follows logic that any school would want to entice enrollees with the smallest payout needed to attract commitment, and that level is reached through good old-fashioned negotiation—topping the competing offer enough to secure enrollment without throwing unnecessary money into the pot. Clearly, this is why many schools indicate ‘eligibility’ and ‘amounts ranging from $4,000 to $10,000’ as callouts— allowing the families of potential enrollees to extrapolate award expectations in excess of what will actually be awarded. By triggering the good feelings and associations with this imagined amount, families subconsciously begin to favor schools with more extravagant totals. Then, of course, the process of negotiation and clarification begins—and this is the process that imbues the concept of financial aid with such anxiety for parents.
This is compounded by the fact that fine print can significantly affect award amounts, even as parents who believe themselves to be informed miss important deadlines, qualifying actions and supplemental applications. As Mark Kantrowitz of Edvisors.org explains to Forbes.com, “Parents should not need a PhD in economics to read financial aid award letters, but until Congress decides to make the college shopping sheet [a controversial templated guide to clarify financial breakdowns] mandatory, they’re going to need help.” Obviously, schools that take the lead as first movers like WSCU stand to benefit greatly from grateful parents and higher enrollment.
From The Wall Street Journal, the number of small or seemingly unrelated decisions a family makes (remarriage, buying second property, career field) that can invisibly alter award amounts is startling:
What many don’t know—or at least, don’t realize until it’s too late—is that the timing of certain financial decisions made well before and even during college can significantly alter a student’s eligibility for aid from both the federal government and the university itself. “It’s like trying to pilot a plane from New York City to Los Angeles,” says Kalman Chany, a college financial-aid adviser in Manhattan. “If you’re off by a half of a degree in the beginning and you don’t notice early enough, by the time you’re on the other side of the country, you’ll be hundreds of miles off course.” From “Mistakes Parents Make with Financial Aid” by Charlie Wells http://www.wsj.com/articles/mistakes-parents-make-with-financial-aid-1411333024
Much to the joy of parents in their prospect pool, Western Connecticut State University confronted the problems with financial aid offers head-on—and it worked. While competing institutions delayed their award announcements and dueled figures with each other, WCSU discarded the sleight-of-hand and back-and-forth to make their awards precise, easy to understand, and calculated actual totals as a concrete starting point for aid negotiation—and sent this information early. As Mr. Davis indicated, though, this degree of transparency made the negotiation element of this process nearly moot, spending only $2,000 beyond their initial award tallies to attract eligible students to enroll.
What’s clear is that WCSU’s strategy flipped the script, and was well-rewarded for doing so. To this end, it is worth your time as an admissions professional to interrogate how your institution handles the awards process, and what could possibly be amended to reduce confusion and increase the favorable association post-accept pre-enroll students and families create with your school as a result. Money, of course, isn’t the only reason students choose one school over the other, and by improving customer experience within the financial dialog, a school stands to gain substantially favorable relationships with potential enrollees. With that in mind, we suggest a few tactics for upcoming admissions terms that can help your prospects and their families find footing in financial aid and view your institution with the integrity it deserves.
Parent Financial Aid Nurture
Spectrum advocates collecting parental contact information as early as possible. With parental emails at the inquiry level, you can alert parents to awards, conditions and deadlines months before they begin receiving correspondence from competing schools covering similar topics. This sets up a clear line of dialog between parents and reps, as well as works to mitigate the number of phone calls reps need to field to relay the same information over and over again to different sets of parents. Emails covering short details like FAFSA codes and conditional eligibility (location, demographic background, merit), can keep parents informed and active throughout the application process, and even encourage them to participate more actively in their child’s applications.
Parent-Oriented Web Page or Microsite Section
A single web portal that houses information for parents seeking to learn more about their financial aid options—both institutional and federal—can be a vital resource for parents who want a single location to plant their feet. If these considerations are principally about user experience, a web portal can enhance a parent’s sense of control, both over the information they choose to pursue and the timeline in which they may pursue it. If this page is integrated into your CRM, all the better—features like dynamic checklists that show parents where their child’s application materials stand in real time, or variable tabs that display or collapse information concerning specific scholarships based on student eligibility, can make the process more interactive and grant parents a more global perspective.
Financial Aid Webinar
A webinar is an excellent opportunity to clarify how parents can get a clear idea of what they’ll be required to pay. Even with the award information’s accompanying explanation of terms, a print piece may not cover every question parents may have. If you release your awards in a blast campaign, you can advertise an official webinar for parents to attend (or watch a later recording of) that covers deadlines, best practices and questions about anticipated costs. For many schools, ‘sticker price’ and difference between totals calculated between the Net Price Calculator and the generalized Anticipated Cost of Attendance serve as confusing, and often inflated, indicators of what parents can expect.
Advertise 3rd-Party Resources
As mentioned above, the college shopping sheet – http://collegecost.ed.gov/shopping_sheet.pdf – is a supplement that families can use in calculating costs. Additionally, guides like the Federal Student Aid’s section for Parents (https://studentaid.ed.gov/resources/parents) and their accompanying video (https://www.youtube.com/watch?v=c-23SMf5DyQ) are resources that many families will find useful. Families may very well locate these resources on their own, but by collating them and providing an easy reference sheet, your school can appropriate the positive informational exchange without any overhead or additional time.
Striking, personalized packages with tallied financial awards, supplemental information, open connections with reps and financial services workers and clear next steps are essential. Not only will they visually dominate the desk when letters are spread out for comparison, they will enhance brand favorability and keep prospects flowing smoothly through the pipeline.
Financial Aid is a bit of an albatross in the admissions field—everyone is well aware of the fact that tuition fees are increasing and know that braving the seemingly innavigable waters of the financial aid system is one of the only ways to diffuse financial burden. If your school can provide clear, actionable next steps and understandable award terms and amounts, you can expect to draw more students and families to enroll. Rather than engaging in another year of static letters and multiple returns to the table to whittle your fees to be an inch shorter than your competitors, be a part of the burgeoning revolution of Financial Aid champions—where clarity is king, and families feel supported.