Examples of Financial Aid Letters. Photo Licensed CC by Christopher S. Penn.
According to R. Barbara Gitenstein, president of the College of New Jersey, the model financial aid award letter will not solve the college affordability problem. She’s right. It also won’t solve global warming or cure cancer since that’s not its intention either. The purpose of the model aid letter is not to rein in college costs, but to provide students with something they desperately need—clear, comparable information about their personal financial aid offers.
In an opinion piece published by both The Huffington Post and Inside Higher Ed, Gitenstein’s main argument for why a model aid letter isn’t necessary hinges on her belief that it is too similar to existing voluntary efforts:
I think we can all agree that colleges and universities should be open and honest with prospective students about the actual cost of attaining a degree, not just enrolling for a year. Providing information that allows for simple, accurate comparison of institutions is a worthwhile goal, but I believe that adding a few data points to [the Voluntary System of Accountability's (VSA) College Portrait] would be a better strategy than implementing the [model aid letter].
The VSA’s College Portrait, which was developed by a consortium of four-year, public universities, can be a helpful resource to students and families. However, as the name suggests, it is voluntary. This is a huge problem—of the more than 6,600 Title IV institutions in America, only 300 are represented in the VSA’s database. If everyone could “agree that colleges and universities should be open and honest with prospective students” regarding college costs, then the voluntary resource would include 100 percent—not five percent—of institutions.
The VSA’s college cost calculations, moreover, involve a lot of legwork for students. Their “college cost estimator” simply provides a link to each college’s net price calculator. Net price calculators can be informative, but are often complicated to use, and user-friendliness depends on the institution. If students are able to navigate the calculator, they still only see an estimation of what they might owe (huge asterisk) and what their financial aid package might contain (another huge asterisk).
The VSA, ultimately, is a resource just like countless others that is meant to help students make informed decisions about where to apply to college. In order to get any use from it, students must know that it exists. Award letters, on the other hand, are automatically sent to students once they are accepted to the institution. They provide a real aid package tailored to each student’s financial situation that a student must accept or decline.
The problem with award letters currently is that each institution creates their own, making it difficult for students to compare offers and understand just how much they will pay for their college education. At their best, these letters are confusing, but at their worst they actively mislead all but the savviest of students into believing that they are getting a fantastic deal by mixing loans (including Parent PLUS loans), work study, and grants together in one mega-package.
Students have a right to clear information on how much they will owe up-front and in loans. That’s why Education Secretary Arne Duncan has encouraged colleges and universities to agree to voluntarily adopt the model letter and why Senator Al Franken proposed legislation to make it mandatory. The purpose of the model aid letter is to standardize, simplify, and personalize existing information, making aid packages easier to understand and compare. So while a standardized letter will not do much to curb rising costs (which, don’t get me wrong, need to be addressed), it will go a long way in helping students make informed decisions about which school is the most affordable for them.