In a few months, students who have been admitted to college or plan to continue attending college and who applied for financial aid will receive their financial aid award letters.
Financial aid offices at colleges and universities send award letters to students to outline how much aid they’ll receive.
But many award letters are written and organized so poorly you’d need a translator to help you make sense of what’s in them. And worse, each institution has its own version of an award letter, so it’s hard to compare award letters from multiple colleges and universities.
Imagine making one of the most significant investments you and your family will make in your lifetime and not knowing the terms and conditions of that investment. And if you’re considering multiple options, imagine not being able to compare which option is the better deal.
Colleges and universities can—and should—do better.
In 2012, the U.S. Department of Education (ED) called on colleges and universities to voluntarily adopt the Financial Aid Shopping Sheet, a financial award letter template that’s easy to read and that allows students to compare financial aid packages between institutions more easily. As of 2017, more than 3,000 colleges and universities signed on to use the shopping sheet.
Although ED is no longer updating the list of colleges and universities that use the shopping sheet (the last template release was in October 2017), organizations are calling for more consistent and consumer-friendly financial aid award letters to help students and families make more informed decisions about which institutions are the best financial fit for them.
In a report released this summer, New America Foundation and uAspire reviewed more than 11,000 financial aid award letters from more than 900 colleges and universities. Not surprisingly, they found that the letters contained confusing jargon and terminology. They also found that not all the letters included information about the differences between the types of financial aid that would be important for students and families to know. For example, as a student, you’d probably want to know that grants and scholarships don’t have to be paid back, but that loans do. (Disturbingly, they found more than 130 unique terms in the award letters for the Federal Direct Unsubsidized Loan, “including 24 that did not include the world ‘loan.’”)
Think about those mortgage commercials where Keegan-Michael Key translates complex and confusing concepts into language that’s easier to understand. What if our colleges and universities did a better job of providing information about how much students and families are expected to pay?
New York is currently the only state that requires all colleges and universities in the state to provide uniform award information sheets to financial aid applicants. Similar legislation has been introduced in Virginia.
More states should follow suit. Especially as part of a coordinated effort to make the cost, quality, and outcomes of college more transparent and easily understood, uniform financial aid award letters can go a long way in helping students and families make more informed decisions about their investment in college.