WANTED:
to Graduate
Financial Aid’s
Role in Retention
Introduction

You (RMASFAA members) voted for it
(RMASFAA blog); we (RMASFAA Training
Committee) presented on it!

THANK YOU for your participation!
2013 Training Committee
Why do Students Withdraw?
Students who are undecided or who have a less job
specific major are more likely to drop out*
* Source: Harvard. (2011)
Why Should Financial Aid Offices be
Concerned?
Movement to tie state funds to graduation
rates or other performance indicators
* Source: NCSL. (2012)
FAO Concern: Graduation Rates
Total Public and Private (2009)
Three-Year Graduation
Rates for Associate Students
Six-Year Graduation Rates of
Bachelor’s Students
RMASFAA States
RMASFAA States
Colorado: 39.3%
Kansas: 34.4%
Montana: 24.4%
Nebraska: 30.3%
N. Dakota: 37%
S. Dakota: 60.7%
Utah: 36.4%
Wyoming: 53.9%
U.S. Average: 29.2%
Colorado: 53.3%
Kansas: 53.2%
Montana: 45.2%
Nebraska: 55.1%
N. Dakota: 46.9%
S. Dakota: 44.8%
Utah: 51.5%
Wyoming: 55.4%
U.S. Average: 55.5%
Source: NCES, IPEDS Graduation Rate Survey
FAO Concern: Student Pipeline Rates
9th Grade to College Grad
Total Public and Private, Two-Year and Four-Year (2008)
RMASFAA States
Colorado: 22.2%
Kansas: 22.0%
Montana: 16.1%
Nebraska: 24.9%
N. Dakota: 24.6%
S. Dakota: 29.5%
Utah: 20.8%
Wyoming: 25.5%
U.S. Average: 20.5%
FAO Concern: Default Rate
o
Borrowers who do not graduate default on
their loans at a higher rate than those do.
o
The average default rate for those borrowers
with no degree is more than 4 X the rate for
those with a Bachelor’s degree*
o
Loan default = no Title IV, bad credit reports,
collection agency contact, IRS income tax
offset, negative impacts on ability to get jobs
* Source: Nguyen, M. (2012)
Retention Problems
vs
Financial Aid Solutions
The MONEY Issue
The MONEY Issue??

Stating “financial reasons” on withdrawal
surveys might be easier than listing more
personal or difficult reasons.
• Financial aid or cost are much more
important for “first purchase” than
“repurchase” decisions. *
• Degrees of dissatisfaction and satisfaction (the
latter involving esteem, relationships, etc.) are
the real drivers/influencers to re-enrollment
behavior. *
* Source: Scannell, J. (2011)
The MONEY Issue??

Financial issues may be more of a “tipping
point” when students are already concerned
with:
◦
◦
◦
◦

Academic performance
Campus relationships
Family issues
Work situations
Assuming
is always the main driver to
improved retention rates is not enough
* Source: Scannell, J. (2011)
The MONEY Issue??
Higher performing students are more likely
to transfer out regardless of a financial aid
package. *
o Thus college cost is not a variable in student
selection process for higher performing
students.*
o
VS.
* Source: Herzog. (2008)
The MONEY Issue

Increasing financial aid packages creates only
modest improvements in retention
◦ A $1,000 increase in gift aid results in a 2-4%
increase in student retention on average.*
◦ Is a marginal benefit
worth a large-scale
and costly expansion?
* Source: Crockett, K, Heffron, M., & Schneider, M. (2011)
The MONEY Issue

College is expensive

Cost of living has continued to go up

Families may plan for year one, but not
for later years

Parent unable/unwilling to help
The MONEY Issue


Many families experiencing catastrophic
financial situations
More PLUS loans being denied*
◦ Previously looked at whether applicant had an
adverse credit history for an account in the past
90 days
◦ Now looks for delinquent accounts during last 5
years
 Foreclosures, bankruptcies, wage garnishments,
repossessions, tax liens, past due payments.
* Source:Vergakis, B. (2013)
The MONEY Issue
Use endowed funds to respond to increased
need among returning students instead of only
targeting to academic success

o Academically successful students are more likely to be
retained anyways*

Create grant programs with set criteria so new
and continuing students can see stability

Have funds that can be used on a case by case basis
to holistically assess need and retention
* Source: Scannell, J. (2011)
The MONEY Issue

Do a cost/benefit analysis
Identify which populations are most at risk
financially.
 Where do breakpoints occur at various
levels of unmet need?

* Source: Scannell, J. (2011)
Retention Problems
vs
Financial Aid Solutions
The OTHER Issues
The REMEDIAL Issue
•
Students not ready academically for college,
put in remedial classes*
o
>50% of students entering 2 yr colleges and almost 20%
of those entering 4 yr colleges are placed in remedial
classes.**
o
Drains money intended to pay for college courses
o
Students may go into debt over these courses
o
Reduces student’s chances of success in college
* Source: Elliott, S. (2013)
** Source: Complete College America. (2013)
The REMEDIAL Issue
“The evidence is clear very few students who have
this cycle ever graduate from an institution of
higher education”*
•
According to ED, students who are more likely
to withdraw are:**
o
o
Students who take any remedial course
Students with a GPA below 2.75
* Source: Elliott, S. (2013)
** Source: U.S. Dept. of Education (2002)
The ACADEMIC Issue

Providing additional in-person counseling

Requiring that certain steps in the
financial aid process be completed in
person.

Require loan counseling for any student
whose grade point average falls below a
certain point.
The IDENTITY Issue
•
Retention requires a degree of connection
between student and institution
•
Withdrawal is failure to make that
connection.
o Students “… who experienced lower social and academic integration
into campus life during their first year of postsecondary education were
more likely than others to leave within 3 years”*
o Students are at higher risk of withdrawal if they begin attending higher
education during any semester other than fall*
* Source: U.S. Dept. of Education (2002)
The IDENTITY Issue

Enhancing connections between financial aid
office with academic faculty, advisors, and
advocacy offices
◦ Let other offices know that the financial aid office
may have solutions
 Offer presentations to faculty groups and departments
◦ Allow others to report students they are concerned
about (financial reasons).
 Assign a financial aid counselor liaison for each department on
campus
 Communication can be initiated by either office
The NEWBIE Issue
•
Nationally,1st Gen students less likely to
attend & persist in college*
•
Only 26% of 1st Gen students who
graduated from high school and enrolled
in college, earned a BA within 8 yrs of
enrollment (68%)*
* Source: Musslewhite & Reeve, (2012)
The NEWBIE Issue
• Additional diversity amongst these
students*
o
Low income and more likely to be from
the lowest income quartile
o
Age
o
Level of parent education (none above
Associate’s)
o
Minority; more likely to be Black or
Hispanic
* Source: Musslewhite & Reeve, (2012)
The NEWBIE Issue

Participation in Pre-Collegiate & Bridging
Programs (TRIO programs)
o
Upward Bound, Talent Search, Black Issues Forum,
Lorenzo de Zavala session, etc…
• These types of programs are shown to work for First Generation
& minority populations
o
At CSU a $2,500 annual Partnership Award
(renewable) is awarded to incoming freshman who
have participated in one of the above mentioned
programs
The NEWBIE Issue

Colorado State University
First Generation Award
o
$4,000 per year, renewable up to 5 years
o
Student’s parents must NOT have received a
bachelor’s degree
o
Must demonstrate financial need
o
Must demonstrate potential for academic success
o
Outreach and Support Programs Department
• Provides University connection
The NEWBIE Issue

Colorado State University (CSU)
◦ Recipient of the Educational Policy Institute’s 2011 Outstanding
Student Retention Program award
◦ Commitment to Colorado
 Promises grant funds at least equal to the amount of annual tuition and
fees for Pell grant eligible CO residents
 Promises grant funds equal to half the amount of annual tuition for CO
resident students whose families earn CO’s median household income or
less
 More information: http://www.sfs.colostate.edu/commitment-to-colorado
◦ Student Support Grant
 Holistic grant that helps students in financial need nearing graduation stay
in school.
 Amount of grant is different for each student and based on multiple
factors determined by the financial aid counselor.
The COMMUNICATION Issue

Social media/networking for financial aid
outreach
Everybody’s doing it…. Set up a Facebook page
or a Twitter account to get the word out to these
Millennials and Social Media-friendly parents
o
o
Have school’s main Social Media site (official) send
out status reports and tweets of important
financial aid events and deadlines
• Have the main site “share” your page’s status updates
The IGNORANCE Issue
•
Lack of student and family knowledge of
financial aid programs and the financial aid
office
A 2012 report states that:
“College students are generally mentored
by their parents and ignore experts
(especially online experts).”*
* Source: Millennial Branding & StudentAdvisor.com, (2012)
The IGNORANCE Issue

Start early! Educate!

Increasing outreach to middle schools for family
financial planning

More financially ready students & families
The IGNORANCE Issue

Financial literacy campaign for new and
continuing students
o
o
Classroom
workshops
o
Require completion of
an annual program
o
Peer-to-peer
counseling/presenting
On-line programs
o
Publications
o
Emails
OUT REACH Example

Cecil Community College (MD)
◦ Campaign to increase financial aid awareness
 Informational workshops
 Targeted mailings
 Phone calls to students eligible for financial aid but had not
enrolled
◦ Campaign resulted in financial aid participation rate increase
of 33 - 39% in two years
 Retention rates of financial aid recipients increased slightly at 1%
◦ College expansions
 Increase staff & computer support in learning centers
 Retooled career & job placement services
* Source: Center for Community College Student Engagement.(2006)
OUT REACH Example

“Life Coaching”
o
Programs available for a price available
online (ex: universitylifecoach.com)
• Stresses goal setting, action planning, resourcing &
accountability
• Price can be hundreds of dollars, not reasonable for a
cash-strapped college student
o
Offer programs on campus available to
students
OUT REACH Example

Salish Kootenai College
o
Takes students on financial aid probation
due to academic probation, and provides
one academic quarter of intensive intrusive
advising & skill building
• Provides academic help when students may not
know how (or be willing) to ask for it
• Provides connection with faculty in academic major
• Improved persistence rates were shown for these
students
OUT REACH Example

Kansas State University
o
Offers free financial counseling to
students to help with budgeting and
managing debt
• Met with 220 “clients” on campus Fall 2012
semester, and hope to reach 400 for 2012-2013
year
o
Offers group financial presentations covering
budgeting, credit, student loan repayment and
financial planning
• For 2011-2012, 94 presentations were given that
reached 3,800 individuals
• For 2012-2013, 73 presentations have been given thus
far
OUT REACH Example

Sitting Bull College (ND)
o
Holds Health & Financial Fairs each
semester, bringing in local area services to
educate student
o
Holds Student Summit each semester to
allow students to ask question and visit
with representatives from various
departments on campus
The BOTTOM LINE
•
Students who are the most high risk may
also be the least responsive to retention
efforts*
o May not be cost (or time) effective to target this
group
•
Students who are high risk for withdrawal
remain high risk throughout their college
enrollment*
* Source: Singell, L.D. & Waddell, G.R. (2010)
Group Discussion
What is your office doing to aid in retention?
What works and what doesn’t?
•
•
•
•
Specific aid?
Targeting specific groups or case-by-case?
Campus Connections?
Outreach?
References
Ackerman, R., & Schibrowsky, J. (2007-2008). A business marketing strategy applied to student retention: A higher education
initiative. Journal of College Student Retention: Research, Theory & Practice, 9(3), 307-336.
Allen, J., Robbins, S. B., Casillas, A., & Oh, I.-S. (2008, November). Third-year college retention and transfer: Effects of
academic performance, motivation, and social connectedness. Research in Higher Education, 49(7), 647-664. doi:
10.1007/s11162-008-9098-3
Bowen, W. G., Chingos, M. M., & McPherson, M. S. (2009). Crossing the finish line. Princeton, NJ: Princeton University Press.
Carnevale, A.P.; Jayasundera, T.; and Cheah, B. August 2012. Executive Summary: The College Advantage: Weathering the
Economic Storm. Georgetown University Center on Education and the Workforce.
Carnevale, A.P.; Rose, S.J.; and Cheah, B. August 2011. The College Payoff: Education, Occupations, Lifetime Earnings. Georgetown
University Center on Education and the Workforce. Retrieved from:
http://www9.georgetown.edu/grad/gppi/hpi/cew/pdfs/collegepayoff-complete.pdf.
Carnevale, A.P.; Smith, N.; and Strohl, J. June 2010. Executive Summary: Help Wanted: Projections of Jobs and Education
Requirements Through 2018. Georgetown University Center on Education and the Workforce.
Center for Community College Student Engagement. (2006). Act on Fact: Using Data to Improve Student Success. Austin, TX: The
University of Texas at Austin, Community College Leadership Program.
Complete College America. Spring 2012. Remediation: Higher Education’s Bridge to Nowhere.. Retrieved from:
http://www.completecollege.org/docs/CCA-Remediation-final.pdf. pp. 2-3.
Crockett, K., Heffron, M., Schneider, M. (2011). Targeting Financial Aid for Improved Retention Outcomes. Noel-Levitz and
American Institutes for Research. Retrieved from: http://www.air.org/files/LA_PELL_STUDY_report_1011.pdf
Dalton, D., Moore, C. A., & Whittaker, R. (2009, Spring). First-generation, low-income students: Strategies for success at
Lyndon State College. The New England Journal of Higher Education, 23(5), 26-27.
References cont.
Dillon, E., & Smiles, R. V. (2010, February). Lowering student loan default rates: What one consortium of historically
black institutions did to succeed. Washington, DC: Education Sector.
Domonell, K. (2013). Sequestering Minority Education. University Business 3/26/2013.
Ellitot, S. (2013). Indiana legislature bill aims to boost college readiness by typing financial aid to state exams. Retrieved from:
http://www.indystar.com/article/20130124/NEWS05/130124042/Bill-aims-boost-college-readiness-by-tying-financialaid-state-exams?gcheck=1&nclick_check=1
Gross, J. P. K., Cekic, O., Hossler, D., & Hillman, N. (2009). What matters in student loan default: A review of the
research literature. Journal of Student Financial Aid, 39(1), 19-29.
Harvard Graduate School of Education. (2011). Pathways to Prosperity Study.
Henderson, S., Tatum, J. (2009). Beyond Leveraging: Financial Aid’s Role in Executing SEM Recruitment and Retention. 19th
AACRAO Enrollment Management Conference. Univeristy of Michigan-Dearborn. Retrieved from:
http://handouts.aacrao.org/sem19/finished/T0215p_J_Benfield%20Tatum.pdf
Herr, E., & Burt, L. (2005). Predicting student loan default for the University of Texas at Austin. Journal of Student
Financial Aid, 35(2), 27-49.
Herzog. (2008) Journal of Student Financial Aid. 37(3)
Millennial Branding and StudentAdvisor.com. (2012). Millennial Branding and StudentAdvisor.com Release New Study on
Student Career Development. Retrieved from: http://millennialbranding.com/2012/11/student-career-development-study/
NCHEMS Information Center for Higher Education Policymaking and Analysis, http://www.higheredinfo.org/
National Association of Student Financial Aid Administrators Graduate/Professional Issues Committee. (2005). Debt
management strategies: For graduate and professional students. Student Aid Transcript, 16(1), 20-23.
National Conference of State Legislatures (NCSL). (2012). Performance Funding for Higher Education. Retrieved from:
http://www.ncsl.org/issues-research/educ/performance-funding.aspx
References cont.
Nguyen, M. February 2012. Degreeless in Debt:What Happens to Borrowers Who Drop Out. Retrieved from:
http://www.educationsector.org/publications/degreeless-debt-what-happens-borrowers-who-drop-out
O'Neal, S., & Kent, C. (2002). Take one small step: Traveling the path to default reduction. Student Aid Transcript, 13(4), 815.
Pinto, M. B., & Mansfield, P. M. (2006). Financially at-risk college students: An exploratory investigation of student loan
debt and prioritization of debt repayment. Journal of Student Financial Aid, 35(2), 22-32.
Sallie Mae. (2008). 2007 Survey of Parents of College-Bound Freshmen. Retrieved from:
http://www.rmasfaa.org/docs/exchange/200803/rme6.html
Scannell, J. (2011). The Role of Financial Aid and Retention. Retrieved from:
http://www.universitybusiness.com/article/role-financial-aid-and-retention
Singell, L. D., & Waddell, G. R. (2010, September). Modeling retention at a large public university: Can at-risk students
be identified early enough to treat? Research in Higher Education, 51(6), 546-572. doi: 10.1007/s11162-010-9170-7
Smith, M. (2008). Right on the money: Training students in financial literacy. Student Aid Transcript, 19(3), 6-10.
Steiner, M., & Teszler, N. (2005, January). Multivariate analysis of student loan defaulters at Texas A&M University.
Round Rock, TX: Texas Guaranteed Student Loan Corporation.
Time Ideas. (2012). 8 Ideas to Improve Higher Education. Retrieved from: http://ideas.time.com/2012/10/18/8-ideas-toimprove-higher-education/#slide/tie-funding-to-graduation-rates/?&_suid=13594909150780032817017170189644
USA Today. (2013). Which colleges offer the best value? Retrieved from:
http://www.9news.com/news/article/314987/339/Which-colleges-offer-the-best-valueU.S. Department of Education. (2000, October). Ensuring student loan repayment: A national handbook of best
practices. Washington, DC: Office of Student Financial Assistance.
References cont.

U.S. Department of Education. (2002, November). Short-term enrollment in postsecondary education: Student
background and institutional differences in reasons for early departure, 1996-98. Washington, DC: National
Center for Education Statistics.

U.S. Department of Education. (2010). Default prevention and management. Washington, DC: Federal Student
Aid.

Vergakis, B. (2013). Feds’ loan changes hamper black college enrollment. Associated Press. Retrieved from:
http://news.yahoo.com/feds-loan-changes-hamper-black-162929184.html

Wilmsen, E. (2011). Educational Policy Institute honors CSU with 2011 Outstanding Student Retention Program award.
Today @ Colorado State. Retrieved from: http://www.today.colostate.edu/story.aspx?id=5727