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Low-Income Students Pay Almost Half Their Earnings in Tuition Costs

Posted by Jessica Perkins on April 6, 2016

Time and time again, we see students struggling to afford college tuition when universities fail to meet students' financial needs. A recent report by Steven Burd, a policy analyst at New America, revealed that this reccuring problem is now significantly affecting extremely low-income students. Burd has found that there are hundreds of schools that are expecting families who make $30,000 or less per year to pay more than half of their salary in tuition costs. A large portion of these schools appear to be private nonprofit colleges. 

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Although a lot of these schools may not have large enough endowments to support these students, many are still awarding merit-based scholarships to wealthier students, hoping that the aid will bring in the students who can afford the difference. The schools also use this as a tactic to raise the rankings of the school and to build its prestige. The same occurs in public universities who have taken on similar enrollment tactics. This has a detrimental effect on the low-income students, who usually account for around 10% of universities' student population. The universities' focus on the allocation of financial need does not appear to be on these low-income students, and this tendency needs to change. 

The government has made efforts, such as awarding federal Pell Grants to students who qualify, but many schools don't seem to be meeting the government halfway like they used to. The article does show that many schools have been making the effort to have these needy students paying no more than $10,000 a year, yet so many schools who have the financial resources are not doing so. Universities should become more focused on decreasing the cost for these students, as some schools are requiring low-income students to be paying around $30,000 in costs.

New America suggests that the federal government should reward schools that make an effort to cut costs for low-income students, as well as require the schools who neglect this population of low income students to match a portion of the Pell dollars that the students receive. Schools and nonprofit organizations can also make a stronger effort to help students identify and connect to the financial resources they need to afford college by sending periodic text messages. Research by Ben Castleman and Lindsay Page shows that text messaging is a low cost strategy that can provide students with information and connect them to the support they need. Organizations should be actively communicating with their students throughout these processes and what better way than texting!

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About the author: Jessica is a senior at the George Washington University, where she's studying marketing. She's the Business Development Intern and keeps the team updated on the latest mobile trends for college students.

Topics: Enrollment, Higher Education, Research

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