While there have been substantial investments to support students with their initial FAFSA completion, less attention has been devoted to whether students re-apply for financial aid once enrolled in college. Yet, nearly a quarter of freshman Pell Grant recipients in good academic standing do not re-apply for aid at the end of their first year (Bird & Castleman, 2014). One explanation for why students do not renew their FAFSA application at the end of freshman year is that they decide that the costs of college—even net of expected financial aid—exceed the benefits, and they do not plan to continue in sophomore year. There are several alternative explanations for why aid-eligible college freshmen might not re-apply for aid even if they plan to persist in college. First, faced with complex tasks such as renewing the FAFSA, individuals often procrastinate in favor of more pressing or enjoyable pursuits (Madrian & Shea, 2001; Thaler & Benartzi, 2004). Second, students may want to complete the FAFSA but be unaware of support resources that they can access for guidance on how to re-apply for financial aid (Castleman, Page, & Schooley, 2014). Finally, students may feel stigmatized about having to ask for help with financial aid; uncertainty about how to re-apply for aid may exacerbate existing doubt the student has about whether they really belong in college (Walton & Cohen, 2011).

Policy makers and researchers increasingly focus on how behavioral insights can be leveraged to improve student and family decision-making in education (Castleman, 2013; Castleman & Page, 2013; Ross et al. 2012). We contribute to this nascent literature with a randomized trial to investigate the impact of financial aid-related prompts on whether college freshman re-apply for aid and persist into sophomore year. The core question that we investigate is as follows: Does a text messaging campaign that informs students of key stages in the financial aid renewal process and that offers to connect them to professional assistance help to increase the probability that students will re-apply for aid and persist into sophomore year of college?

The core of this freshman year financial aid nudge campaign was a series of text messages that reminded students about important tasks and deadlines related to financial aid re-application. We began delivering messages in mid-winter, when students could first renew their FAFSA application, and continued sending messages through the summer after freshman year, during which time students had to review and make decisions based on financial aid award letters and pay their sophomore year tuition bills. The messages provided students with institution-specific information and offered students the opportunity to ask questions of or request help directly from financial aid advisors. We partnered with uAspire, a Boston-based college access organization, to implement the intervention with an experimental sample of 733 college freshmen. Results indicate that the financial aid texts had large and positive impacts on second-year persistence among community college students.  We identify several mechanisms by which financial aid prompts could positively influence whether students successfully persist into sophomore year.