Panel: Innovations in Financial Aid: Strategies for Improving College Access and Success
(Education)

Thursday, November 6, 2014: 10:15 AM-11:45 AM
Galisteo (Convention Center)

*Names in bold indicate Presenter

Panel Organizers:  Lindsay C. Page, University of Pittsburgh
Panel Chairs:  Adela Soliz, Harvard University
Discussants:  Angela Boatman, Vanderbilt University


Freshman Year Financial Aid Nudges: An Experiment to Increase Financial Aid Renewal and Sophomore Year Persistence
Benjamin Castleman, University of Virginia and Lindsay C. Page, University of Pittsburgh


Concerns about the low visibility and complexity of the federal financial aid system have prompted concerted policy efforts to both simplify the aid application process and to support students and families to complete the Free Application for Federal Student Aid (FAFSA). Several of these interventions have led to substantial improvements in the rate of FAFSA completion and college attendance. For instance, low-income families with college-age dependents who received FAFSA completion assistance as part of their income tax preparation were substantially more likely to submit a FAFSA and were eight percentage points more likely to enroll for at least two years in college than students whose families did not receive assistance (Bettinger et al, 2012). In another study, students who received school-based support to file the FAFSA as part of a federal FAFSA Completion pilot initiative were nearly 12 percentage points more likely to enroll in college than students who were not offered school-based support with the FAFSA (Owen, 2012). At a national level the United States Department of Education has created tools like the FAFSA 4Caster, which enables students and families to obtain a personalized estimate of how much aid they would qualify for, and has worked with the Internal Revenue Service to pre-populate the FAFSA with information that families provide on their tax returns. While there have been substantial investments to support students with their initial FAFSA completion, however, considerably less attention has been devoted to the financial decisions students make after completing the FAFSA and to whether these students re-apply for financial aid once they are in college. Yet as many as 30 percent of college freshmen who completed the FAFSA prior to enrollment do not re-apply for aid at the end of their first year. The loss of financial aid for sophomore year may be a substantial contributing factor to low national rates of freshman to sophomore year persistence. In this panel, we look beyond initial FAFSA filing to subsequent steps in the financial aid process. The first paper reports on a randomized controlled trial to investigate the impact of using the US Department of Education financial aid “shopping sheet” on students enrollment and borrowing decisions. The second paper reports on descriptive analyses related to FAFSA renewal, arguing that improving rates of FAFSA renewal could contribute to improved rates of college retention. The third paper builds on this argument to test the impact of proactive text-based outreach and reminders regarding FAFSA renewal on persistence into the second year of college. These papers collectively are relevant to ongoing policy efforts to increase college success and completion among low-income students and, more generally, to efforts to simplify information and harness technology to improve students’ educational outcomes.
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