When it comes to college financial aid, nudge parents not students

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One of the more popular ideas in education policy in recent years has been a gentle nudge, rather than a direct push, for behavioral changes that promote better outcomes. In the case of college, efforts have focused largely on testing whether something as simple as small financial aid nudges can improve an array of education outcomes.

As ideas go, nudging ranks high in theory but (like many great ideas) low on demonstrated success. Indeed, just a few weeks ago, another large-scale study — some 800,000 students — found that nudging people with text messages to complete the government’s Free Application for Federal Student Aid (FAFSA) did nothing to improve enrollment or the amount of aid students received.

Why students don’t respond to nudging, especially when the payoff can literally be thousands of dollars, is still unclear. One plausible explanation is students aren’t necessarily de-prioritizing or just forgetting to fill out forms as much as they’re confused by the form itself or struggling to find appropriate supporting documents.

Or, maybe, researchers are focused on nudging the wrong actors: Perhaps instead of students, where financial aid is concerned, researchers should focus on nudging parents and guardians.

These individuals play a crucial role when it comes to how dependent students pay for college. Their tax information not only informs federal aid eligibility on the student’s FAFSA (think how much federal and state grant money is available) but more importantly, they’re also the default source of gap financing.

For some families, that may come from savings accounts or personal resources, but for many, this usually means federal or private loans and sometimes a lot of it. In other words, parents, quite possibly more than students, have a much more vested interest in ensuring that no scholarship or aid dollar goes unapplied for.

The problem, as most industry folks know, is that even when parents play a substantial funding role, they are procedurally left out of the process. Federal, state and even institutional financial aid forms are completed by students, which means that notifications about upcoming deadlines or nudges about partly completed applications end up skipping mom or dad.

But what if this wasn’t the case? Wouldn’t a parent, potentially on the hook for tens of thousands of dollars in loans themselves, be highly incentivized to ensure their child completes the FAFSA? Wouldn’t that same parent also not push their child to get need-based state grant applications in on time or finish filling out a private scholarship application before the deadline?

There are certainly logistical hurdles to overcome when bringing parents and guardians into the accountability fold; the biggest being that financial aid contracts are between colleges or governments or private organizations and students, not family members. As positive as parental nudging may be, 18- to 24-year-olds are still adults. Just “giving” parents access to their 20-year-old’s financial aid applications would be no less invasive than notifying their parents whenever they were late on a credit card payment.

Of course, not every person who goes to college today is a child — or a dependent — and some would likely point out that a majority of higher education students today are, in fact, non-traditional. Still, there are parent-based solutions that could potentially help a large percentage of younger aspiring college students and families obtain more aid that can reduce the cost burden.

At one end of the spectrum, it could be as easy as encouraging grant providers — be it the school or the US Education Department or state governments — to simply offer students starting the financial aid process the ability to opt their parents and guardians in to receiving key notifications. At the other end, Congress could even consider direct action. Should guardians not have the right to be kept aware of aid potentially missed when the amount they must spend — again out of pocket or through loans themselves — depends directly on how much gap financing exists?

What the appropriate balance looks like may still be unclear, but if there is one certainty, it is that paying for college is a family affair for many students. Making higher education more affordable means thinking about how everyone who plays a role in the process, not just students, can work to ensure that no aid ever gets left on the table.

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