What Excites Me About the State of Financial Aid

As the holiday season swings into full gear, it’s a great time of year to think about what matters most to us. How can we better nurture the spirit of family and community in our own lives and the lives of those close to us? Think about how our intentions and our actions, big and small, make the world a better place? And think about the people and events in our lives that make us very grateful to be sharing our journey with others?

Given the nature of my life’s work, I cannot help but think about these things in the context of what it means to be an impactful part of the financial aid community in independent schools. So, here are four things that excite me about the state of financial aid in 2016:

1. You are spending more time making aid decisions. In the 2010 State of Financial Aid survey conducted by SSS, respondents reported spending an average of 25 percent of their time on financial aid duties. In the 2016 update of the 2010 survey, this commitment moved up to 29 percent. This is both good and necessary. As financial aid demand grows and the profile of applicants evolves, the volume and complexity of applications simply require more time to make the best decision. The school’s investment and the family’s stake in the outcomes are both too great to give your decisions short shrift due to limited time. My advice? Take your time. Get your decisions right.

2. You are meeting a growing percentage of financial need. In 2010, respondents said they met, on average, 69 percent of demonstrated need for financial aid applicants. In 2016, this figure rose to 77 percent. Since “gapping” an aid award is particularly tough for families as they occupy the lower rungs of the income ladder, it’s important we continue this movement towards 100 percent of need. In doing so, we’ll have greater impact on the families that need the help the most. Continue to fight for financial aid funding that eliminates gapping.  

3. You are reaching a larger proportion of enrolled students. The 2016-17 NAIS DASL survey shows that the median percentage of enrolled students receiving financial aid in day schools was 21.8 percent, up from 14.1 percent in 1996-97 (and growing from 31.9 percent to 39.9 percent for boarding-day schools since 1996-97). This trend reflects the willingness and ability of schools to reach more families as income growth lagged through sluggish economic times. This commitment keeps the independent school choice a real one for many who might otherwise have fallen through the affordability cracks over the years. Keep supporting those cries for help.

4. You really care about people. With 82 percent of financial aid professionals telling us that “compassion” is the emotion most-associated with financial aid work, I’m excited that, ultimately, our collective capacity to understand and sympathize with families and students drives our desire to help as much as we possibly can.  The fact that 81 percent of you stated you feel a strong sense of impact on families (even more so than the perceived impact on schools) means that kids and their potential are at the forefront of financial aid decision making. That’s just as it should be. Stay centered in your desire to make a difference.

Understanding these realities gives me real optimism about the work you do every day. You’re spending your most precious capital (time, dollars, and emotional energy) on widening the tent as much as possible. Let’s remain compassionate and work with clear intention throughout this financial aid season, as full of successes and frustrations as it will be. Let’s hold onto the best of what we feel during holiday time to make access and affordability a reality for all families, impacting their lives and the lives of our schools too. I’m excited to help you work your magic yet again this year!

The Board’s Role in Financial Aid

As the guardians of the school’s mission, keepers of the school’s resources and priorities, and owners of the school’s success and accountability, the board of trustees plays a critical part in any school’s effort to manage financial aid resources for sustainability, access, affordability, and/or economic diversity.  What are the best practices for how your school’s trustees can use their role most effectively in ensuring the right outcomes for the aid investment?

What trustees should do…

  1. Articulate the primary purpose of the financial aid investment.  With clear guidance from the school leadership on what financial aid should accomplish for the school community, the board will be better-positioned to endorse policies and establish priorities that will serve as the guideposts for your overall strategy-making and individual awarding decisions for families. 
  2. Determine the financial aid budget.  Clearly, the board decides how much of the school’s resources can be committed to financial aid for students among the school’s operational needs.  With clarity of purpose, the board should be able to assess how many dollars are necessary to achieve that goal.  If the funding available isn’t sufficient, they should be clear on the consequences and trade-offs that come along with budget constraints.
  3. Set criteria for success.  It’s important to know whether the aid investment is achieving the desired purpose.  The board can set benchmarks and data dashboards for financial aid to measure whether the outcomes and trends match the vision for the investment.  This helps you know what criteria will be in place to evaluate your effectiveness in meeting the program goals as well.
  4. Listen to leadership, adapt as necessary.  For the board to be most effective at its role, the input and guidance of the financial aid director is critical.  Yet, not enough of you have regular meetings with the board about financial aid issues.  The 2016 SSS State of Financial Aid Survey shows us that fewer than half of you (41 percent) meet regularly (i.e., more than once a year) with the board of trustees to report on or discuss financial aid issues.  As the financial aid professional on staff, your input into what is and isn’t working in the financial aid program is invaluable to making sure the board can adapt purpose, funding, and/or success metrics as your experience suggests is necessary.  And that their decisions are not just based on their own opinions and perspectives about aid and affordability, which may not be wholly informed.

What trustees shouldn’t do…

  1. Do not make, review, or approve individual award decisions.  10 percent of schools in our 2016 State of Financial Aid survey state that board members sit on the financial aid committee (compared to 18 percent saying so in the 2010 survey).  While this is not considered best practice, as the board’s work should be focused on the school’s strategic and long-term needs, it is more likely to happen among small schools or newer (younger) schools that often rely on trustees to bring expertise to a variety of administrative functions.  This should be avoided, however, whenever possible and left to staff for award decision-making.  Limiting board presence on award-making committees also helps protect confidentiality of families in the process…limiting this decision making to the fewest number of administrators as possible.
  2. Do not advocate specific award decisions for individual parents.  Trustees must avoid pressuring the school head, the financial aid staff, or financial aid committee members to make an award decision for a parent or a student.  This is an inappropriate use of trustee influence on administrative responsibilities.
  3. Do not make promises to families about financial aid outcomes.  From time to time, parents might approach a trustee about needing financial aid or some other discount to enroll their child.  The trustee must not make any promises to the family about getting any financial aid; they shouldn’t even engage in these conversations with families.  Point the family to the financial aid office, who will have the best ability to hear the family’s situation and guide them through the process to the best outcome for everyone involved.
  4. Do not entertain appeals from families.  Some families dissatisfied with their financial aid offer might ask a trustee to use his or her influence to get the decision revisited.  The trustee should acknowledge the family’s disappointment but not entertain the request to intervene on their behalf (nor should they intervene without a request).  Instead, the trustee should refer the family to speak directly to the financial aid office first and follow the steps of the appeals process that the school has in place.
  5. Do not expect special treatment.  Trustees who apply for financial aid should not expect the financial aid staff to extend special privilege to them in the financial aid process.  They should follow the same rules, requirements, and timelines as expected from all families.  And they should respect the goals of fairness, equitability, and objectivity that are the cornerstones of a well-run financial aid operation.

Financial aid is a key lever in reaching enrollment goals, building a mission-driven community, and supporting the financial goals of the school.  When the school’s trustees embrace their unique role in outlining the aid program’s purpose, resources, and measures of success, and leave the financial aid administrators to carry out their role to implement policy and procedures, the partnership will yield the best results for all stakeholders with the highest levels of integrity.

For more on the board’s role in financial aid, check out this video series on the NAIS website.