Want to Reduce Summer Melt? Start By Making College Costs More Transparent

07/09/18

By Mai P. Tran, ECMC Foundation

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Glowing in their caps and gown, high schools seniors across the country recently graduated with high hopes and optimism for the future. Many plan to start college in the fall, but hundreds of thousands will fail to matriculate.

“Summer melt,” the phenomenon where students enroll into a college, but drop out before their first day, disproportionately affects many low-income, first-generation college students. A study from Harvard University estimates that this impacts 10 to 40 percent of students each summer.

Without counselors and teachers over the summer, students have limited support during the summer. Without assistance, the complicated set of tasks they are required to complete before the fall, including complex paperwork, become obstacles to continuing. And for many students, once they receive their first bill, they realize that they can’t afford the college they signed up for.

This problem could be largely prevented if college costs became more transparent from the beginning. The cost of attending a college, included with college acceptance letters typically between February and April, aren’t always clear. Imagine, for instance, receiving a $30,000 scholarship from a private college. While the amount might appear exceptionally generous to a high school senior, it doesn’t account for the annual tuition that can be as high as $50,000 and indirect costs, including books, rent, food and utilities. On the other hand, the same award offered at lower-cost, public institutions would go much further.

In hearings earlier this year on the reauthorization of Higher Education Act, the Senate Committee on Health, Education, Labor and Pensions heard potential solutions from leading education experts. Among them was Laura Keane, chief policy officer at uAspire, who discussed the importance of transparency in financial aid award letters.

Keane presented findings from a study that used the group’s award letter database, which was developed with support from ECMC Foundation.

The study, culminating in a recent report, was conducted in partnership with New America with support from Kresge Foundation and the Jack Kent Cooke Foundation. It found many concerns with financial aid award letters including the fact that schools use different terminology when explaining financial aid offerings, making it difficult to compare information across institutions. In addition, many letters fail to include and break apart key information regarding different types of aid (loan, grants, and work-study). Often, students are led to believe the myth that financial aid will cover everything, when in reality, loans and awards are not always sufficient.

Making a realistic and educated choice means being able to pay for what they are signing up for. Recognizing this, staff at Bottom Line, a national college success program and partner of ECMC Foundation, works with students to help them understand their financial aid award letters. A hallmark of the Bottom Line model is its focus on financial literacy and helping students evaluate whether they can afford the colleges they want to go to.

"We participate as much as possible in their choice, and make sure they understand the different options in terms of costs and the financial obligations they are taking on," says Alissa Silverman, chief growth strategy and development officer at Bottom Line. "Discussions about affordability helps students avoid summer melt." When it comes to finances, Bottom Line counselors help with filling out FAFSA applications and deciphering and analyzing financial aid packages. As a result of Bottom Line’s approach, students in a recent randomized controlled trial reported that they are 10 percent more likely to rank costs as one of their top deciding factors for college and also report that they feel more confident about their ability to afford college.

Working with organizations like Bottom Line and uAspire, ECMC Foundation supports efforts that ensure students and families make choices that are financially sound and appropriate. But programs run by our grantee partners can only do so much. Real change requires broader, sweeping change that has the potential to reach all students. When members of Congress reopen conversations around the reauthorization Higher Education Act, we ask that they consider regulations that help make financial aid packages easier to understand, compare and navigate. This move would help level the playing field for all students and help those at highest risk of dropping out before day 1 beat the summer melt.

After all, doesn’t every student deserve to know the full cost of the college they sign up for?

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