WANTED: to GraduateFinancial Aid’s Role in

Student Retention

2013 RMASFAA Training Committee

HELP!

Sample Retention PlanIdentify the IssueState the ObjectivesFind your groupCreate/Execute the PlanMeasure ResultsShare Results

Public 2 Public 4 Non-profit 40%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Personal Family Financial Academic Dissat. Schedule Other

Reason for Leaving2003-04 Enrollees – Depart at/by End of 1st Year

* Source: Beginning Postsecondary Study 04:06, NCES, Dept. of Education

Public 2 Public 4 Non-profit 40%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Personal Family Financial Academic Dissat. Schedule Other

Reason for Leaving2003-04 Enrollees – Depart at/by End of 3rd Year

* Source: Beginning Postsecondary Study 04:06, NCES, Dept. of Education

Personal Family Financial Academic Dissat. Schedule Other

Public 2 +5% -45% -38% -42% -7% +93% -16%

Public 4 -41% -36% -35% -8% +25% +31% ***

Non-profit 4 -55% -75% +35% * -11% ** +38%

Reason for Leaving2003-04 Enrollees

% Change from: Depart at/by End of 1st to Depart at/by End of 3rd

* Source: Derived from Beginning Postsecondary Study 04:06, NCES, Dept. of Education

* Increase from 0% to 6%** Increase from 0% to 11%*** Increased from 0% to 16%

Reason for Retention Concern• Financial Earnings

o Bachelor’s degree holders earn 31% more than workers with an Associate’s degree and 74% more than those with a high school diploma*

* Source: Carnevale, Rose & Cheah, (2011) ** Source: Carnevale, Smith & Strohl, (2010)

• Need for New Workerso By 2018, the U.S. will need 22

million new workers with Associate’s degrees or higher**

• Will be 3 million workers short• Will need at least 4.7 million new workers

with postsecondary certificates

Reason for Retention Concern cont.• Recent Recession

* Source: Carnevale, Jayasundera & Cheah, (2011)

o Job Changeso +187K Bachelors Degree or highero -1.75M Associates/some collegeo -5.6M HS Diploma or less

o Recovery Job Changeso +2M Bachelors Degree or highero +1.6M Associates/some collegeo -230K HS Diploma or less

o Peak Unemployment rateo 13.4% for adults with HS diploma

o 6.8% for college graduatesVS

Reason for Retention Concern cont.

o The average default rate for those borrowers with no credential/academic earning is more than 4 X the rate for those with a Bachelor’s degree*

o Loan borrowers not completing a program default at a higher rate than those who complete programs

* Source: Nguyen, M. (2012)

• Loan Default Rate

o Loan default = no Title IV, bad credit reports, collection agency contact, IRS income tax offset, negative impacts on ability to get jobs

Reason for Retention Concern cont.• States beginning to tie funds to

graduation rates or other performance indicators• Course completion, time to degree, transfer

rates, number of degrees awarded, number of low-income & minority graduates

* Source: NCSL. (2012)

First Year Retention RatesTotal Public and Private (2010)

RMASFAA StatesColorado: 50%Kansas: 52.6%Montana: 51.6%Nebraska: 59.6%N. Dakota: 54%S. Dakota: 64.5%Utah: 50.8%Wyoming: 57.1%US Average: 54.3%

Source: NCES, IPEDS Fall 2010 Enrollment Retention Rate File

Two-Year Four-Year

RMASFAA StatesColorado: 75.5%Kansas: 72.7%Montana: 68.4%Nebraska: 77.8%N. Dakota: 73.6%S. Dakota: 68.2%Utah: 73.3%Wyoming: 72.7%U.S. Average: 77.1%

Graduation RatesThree-Year Graduation

Rates for Associate Students

RMASFAA StatesColorado: 39.3%Kansas: 34.4%Montana: 24.4%Nebraska: 30.3%N. Dakota: 37%S. Dakota: 60.7%Utah: 36.4%Wyoming: 53.9%U.S. Average: 29.2%

Total Public and Private (2009)

Source: NCES, IPEDS Graduation Rate Survey

Six-Year Graduation Rates of Bachelor’s

Students

RMASFAA StatesColorado: 53.3%Kansas: 53.2%Montana: 45.2%Nebraska: 55.1%N. Dakota: 46.9%S. Dakota: 44.8%Utah: 51.5%Wyoming: 55.4%U.S. Average: 55.5%

Student Pipeline Rates 9th Grade to College Grad

Total Public and Private, Two-Year and Four-Year (2008)

RMASFAA StatesColorado: 22.2%Kansas: 22.0%Montana: 16.1%Nebraska: 24.9%N. Dakota: 24.6%S. Dakota: 29.5%Utah: 20.8%Wyoming: 25.5%U.S. Average: 20.5%

• Financial Concerns

• Not Academically Prepared

• Financial Aid Knowledge

• University Connections

• Other Concerns

What are some barriers to retention?

Financial ConcernCost of college has gone up 2x

the inflation rate; average 5-8% per year

• Families may plan for first year, but not for 2nd, 3rd or 4th years…

Cost of living has continued to go up

No help from parents

Many families experiencing catastrophic financial situations

More PLUS loans being denied*o ED made change October 2011 (after

most loans for 1112 originated) – started to see issues 1213

o Originally looked at whether applicant had an adverse credit history for an account in the past 90 days

o Now looks for delinquent accounts during last 5 years o Foreclosures, bankruptcies, wage

garnishments, repossessions, tax liens, past due payments.

* Source: Vergakis, B. (2013)

Financial Concern cont.

Financial Concern cont.

Increasing financial aid packages creates only modest improvements in retention

o On average $1,000 increase in gift aid results in only a 2-4% increase in student retention*

o Is a marginal benefit worth a large-scale (and costly) expansion?

o Challenge: Identify more cost-effective forms of aid vs. targeting aid programs more effectively

* Source: Crockett, K, Heffron, M.,& Schneider, M. (2011)

Financial Concern cont.

• Colleges and universities (especially at department level) use endowed funds to reward continuing academic success instead of increased need

VS.

4.0

EFC 0

o Higher performing students are more likely to transfer out regardless of a financial aid package. *

o Thus college cost is not a variable in student selection process for higher performing students.*

* Source: Herzog. (2008)

Not Academically Prepared• Remedial classes*

* Source: Elliott, S. (2013) ** Source: Complete College America. (2013)

o >50% of students entering 2 yr colleges and almost 20% of those entering 4 yr colleges are placed in remedial classes.**

o Drains money intended to pay for college courses

o Student may go into debt over these courses

o Imperils student’s chances of success in college

“The evidence is clear very few students who have this cycle (going into debt for remedial classes) ever graduate from an institution of higher education”*

• Dan Clark, executive director of the Education Roundtable

* Source: Elliott, S. (2013) ** Source: U.S. Dept. of Education (2002)

• According to ED, students who are more likely to withdraw are:**

o Students who take any remedial courseo Students with a GPA below 2.75

Not Academically Prepared cont.

Financial Aid Knowledge• Lack of student and family

knowledge of financial aid programs “College students are generally mentored by

their parents and ignore experts (especially online experts)” *

* Source: Millennial Branding & StudentAdvisor.com, (2012)

• Sallie Mae - 2007 Survey of Parents of College-Bound Freshmeno “Cost of school” top priority for15% of

respondents (4th most popular choice)

o “Location of school” was top priority for 34% (most

frequently selected choice)

University Connection• Retention requires a degree of connection

between student and institution

o Students “… who experienced lower social and academic integration into campus life during their first year of postsecondary education were more likely than others to leave within 3 years”*

* Source: U.S. Dept. of Education (2002)

o Students are at higher risk of withdrawal if they begin attending higher education during any semester other than fall*

• Withdrawal is failure to make that connection.

Other Concerns • Embarrassment to ask for help

• Students who are undecided or who have a less job specific major are more likely to drop out*

• Inability to cope with the demands of coursework, studying, a family and job

* Source: Harvard. (2011)

• Cost of going to college really worth the time and effort in school and out of the workforce?

Other Concerns cont.

* Source: Singell, L.D. & Waddell, G.R. (2010)

• Students who are high risk for withdrawal remain high risk throughout their college enrollment*

o May not be cost (or time) effective to target this group

• Students who are the most high risk may also be the least responsive to retention efforts*

In postsecondary education, students are the customers, and customer service is everyone’s responsibility…

What can the Financial Aid Office do?

Ideas for Improvement• Financial Aid Awarding

• Outreach

• Campus Connections

• First Generation Awards

• Minority Populations

Financial Aid AwardingUse endowed funds to respond to increased

need among returning students instead of only targeting to academic success

o Academically successful students are more likely to be retained anyways*

* Source: Scannell, J. (2011)

Create grant programs with set criteria so new and continuing students can see stability

Have funds that can be used on a case by case basis to holistically assess need and retention

Colorado State University (CSU)◦ Commitment to Colorado

Promises grant funds at least equal to the amount of annualtuition and fees for Pell grant eligible CO residents

Promises grant funds equal to half the amount of annual tuition for CO resident students whose families earn CO’s median household income or less

More information: http://www.sfs.colostate.edu/commitment-to-colorado

◦ Student Support Grant Holistic grant that helps students in financial need

nearing graduation stay in school. Amount of grant is different for each student and based

on multiple factors determined by the financial aid counselor.

Financial Aid Awarding cont.

Financial Aid Awarding cont.

Examine where breakpoints in retention occur at various levels of unmet need to identify financially at risk populations

Do a cost/benefit analysis * Source: Scannell, J. (2011)

First GenerationSpecific awards targeting First

Generation studentso Student’s and families with the least

knowledge on college and associated costs

o Additional funding aids in retention of this group

o Encourage first generation college students to participate in Higher Ed and to promote diversity in student population

First Generation cont.

Colorado State University First Generation Award

o $4,000 per year, renewable up to 5 years

o Student’s parents must NOT have received a bachelor’s degree

o Must demonstrate financial needo Must demonstrate potential for academic

successo Outreach and Support Programs

Department• Provides University connection, staff support and

mentoring

Campus ConnectionsEnhancing connections between

financial aid office with academic faculty, advisors, and advocacy offices

o Let other offices know that the financial aid office may have solutions

o Allow others to report students they are concerned about (financial reasons).

• Offer presentations to faculty groups and departments

• Assign a financial aid counselor liaison for each department on campus

• Communication can be initiated by either office

OutreachFinancial literacy campaign for new

and continuing students

o Peer-to-peer counseling/presenting

o Require completion of an annual programs or if a student fails a course, withdraws or their GPA drops below a certain point

• Put fellow students in position of mentor• Topics chosen via peer focus groups

o Classroom workshops, on-line programs, publications, emails

• Students have an increased risk of dropping out with lower GPAs and withdrawals; intervene early

Outreach cont.Kansas State University

o Offers free financial counseling to students to help with budgeting and managing debt

• Met with 406 students on campus during the 2012-2013 academic year

o Offers group financial presentations covering budgeting, credit, student loan repayment and financial planning• Presented to over 5,300 individuals

during the 2012-2013 academic year

Outreach cont.

Sitting Bull College (ND)o Holds Health & Financial Fairs

each semester, bringing in local area services to educate student

o Holds Student Summit each semester to allow students to ask question and visit with representatives from various departments on campus

Outreach cont.

Notifying at-risk students of specific SAP requirements in advance

o Reduce the risk of students leaving due to financial aid exclusion

o KSU contacts students that are admitted on exception and informs them of specific financial aid requirements for their first academic year• These students are also placed on an academic

plan (through the University’s requirement) for their first few semesters

Outreach cont.

Academic Improvement Program – Salish Kootenai College

o Takes students on financial aid probation due to academic probation, and provides one academic quarter of intensive intrusive advising & skill building

• Provides connection with faculty in academic major

• Improved persistence rates were shown for these students

• Provides academic help when students may not know how (or be willing) to ask for it

Outreach cont.

Increasing outreach to middle schools for family financial planning

o Start early! Educate!o More financially ready students &

families

* Source: USA Today. (2013)

o A study published February 2013 in the American Sociological Review found that students who received $12,000 from their parents in the first year of college were more likely to complete their degree*

o However, they were also more likely to get lower grades

Social media/networking for financial aid outreach

Outreach cont.

o Everybody’s doing it…. Set up a Facebook page or a Twitter account to get the word out to these Millennials and Social Media-friendly parents

o Have school’s main Social Media site (official) send out status reports and tweets of important financial aid events and deadlines

• Have the main site “share” your page’s status updates

Outreach cont.

CSU – Warner College of Natural Resources, Social Media Case Study

o What has worked: • Unique photos• Stories/posts about student, alumni &

faculty• Cross promoting• Being a good “friend”

o (responding/”liking” to posts on page, tagging other campus departments)

• “Like” ads o Generally $10/wk or $350 lifetimeo Less successful:

• Open ended questions• External news• Videos• Posting more than 1-2 times a day, 7

days/wk

Outreach cont.

Cecil Community College (MD)◦ Campaign to increase financial aid awareness

Informational workshops Targeted mailings Phone calls to students eligible for financial aid but had

not enrolled◦ Campaign resulted in financial air participation

rate increase of 33 -39% in two years Retention rates of financial aid recipients increased

slightly at 1%◦ College expansions

Increase staff & computer support in learning centers Retooled career & job placement services

* Source: Center for Community College Student Engagement.(2006)

Other ThoughtsStating “financial reasons” on

withdrawal surveys might be easier than listing more personal or difficult reasons.

Michael Collette, VP for Marketing & Strategic Planning at Anderson University (Ind.)

• Degrees of dissatisfaction and satisfaction (the latter involving esteem, relationships, etc.) are the real drivers/influencers to re-enrollment behavior. *

• Financial aid or costs are much more important for “first purchase” than “repurchase” decisions. *AND

* Source: Scannell, J. (2011)

Other Thoughts cont.

Financial issues may be more of a “tipping point” when students are already concerned with:◦Academic performance◦Campus relationships◦Family issues◦Work situations

Assuming is always the main driver to improved retention rates is not enough

* Source: Scannell, J. (2011)

Group Discussion

• Specific aid? Targeting specific groups or case-by-case?

• Campus Connections?

• Outreach?

• Other Thoughts?

What is your office doing to aid in retention?What would you like to see your office do to aid in retention?

ReferencesColorado State University, Warner College of Natural Resources. (2013). Social Media Case Study.

Carnevale, A.P.; Jayasundera, T.; and Cheah, B. August 2012. Executive Summary: The College Advantage: Weathering the Economic Storm. Georgetown University Center on Education and the Workforce.

Carnevale, A.P.; Rose, S.J.; and Cheah, B. August 2011. The College Payoff: Education, Occupations, Lifetime Earnings. Georgetown University Center on Education and the Workforce. Retrieved from: http://www9.georgetown.edu/grad/gppi/hpi/cew/pdfs/collegepayoff-complete.pdf.

Carnevale, A.P.; Smith, N.; and Strohl, J. June 2010. Executive Summary: Help Wanted: Projections of Jobs and Education Requirements Through 2018. Georgetown University Center on Education and the Workforce.

Center for Community College Student Engagement. (2006). Act on Fact: Using Data to Improve Student Success. Austin, TX: The University of Texas at Austin, Community College Leadership Program.

Complete College America. Spring 2012. Remediation: Higher Education’s Bridge to Nowhere.. Retrieved from: http://www.completecollege.org/docs/CCA-Remediation-final.pdf. pp. 2-3.

Crockett, K., Heffron, M., Schneider, M. (2011). Targeting Financial Aid for Improved Retention Outcomes. Noel-Levitz and American Institutes for Research. Retrieved from: http://www.air.org/files/LA_PELL_STUDY_report_1011.pdf

Domonell, K. (2013). Sequestering Minority Education. University Business 3/26/2013.

References cont.Ellitot, S. (2013). Indiana legislature bill aims to boost college readiness by typing financial aid to state exams. Retrieved from: http://www.indystar.com/article/20130124/NEWS05/130124042/Bill-aims-boost-college-readiness-by-tying-financial-aid-state-exams?gcheck=1&nclick_check=1

Harvard Graduate School of Education. (2011). Pathways to Prosperity Study.

Henderson, S., Tatum, J. (2009). Beyond Leveraging: Financial Aid’s Role in Executing SEM Recruitment and Retention. 19th AACRAO Enrollment Management Conference. Univeristy of Michigan-Dearborn. Retrieved from: http://handouts.aacrao.org/sem19/finished/T0215p_J_Benfield%20Tatum.pdf

Herzog. (2008) Journal of Student Financial Aid. 37(3)

Musselwhite & Reeve. (2013). Academic Advising and First Generation Students.

Millennial Branding and StudentAdvisor.com. (2012). Millennial Branding and StudentAdvisor.com Release New Study on Student Career Development. Retrieved from: http://millennialbranding.com/2012/11/student-career-development-study/

NCHEMS Information Center for Higher Education Policymaking and Analysis, http://www.higheredinfo.org/

National Conference of State Legislatures (NCSL). (2012). Performance Funding for Higher Education. Retrieved from: http://www.ncsl.org/issues-research/educ/performance-funding.aspx

Nguyen, M. February 2012. Degreeless in Debt: What Happens to Borrowers Who Drop Out. Retrieved from: http://www.educationsector.org/publications/degreeless-debt-what-happens-borrowers-who-drop-out

Sallie Mae. (2008). 2007 Survey of Parents of College-Bound Freshmen. Retrieved from: http://www.rmasfaa.org/docs/exchange/200803/rme6.html

References cont.

Scannell, J. (2011). The Role of Financial Aid and Retention. Retrieved from: http://www.universitybusiness.com/article/role-financial-aid-and-retention

Singell, L. D., & Waddell, G. R. (2010, September). Modeling retention at a large public university: Can at-risk students be identified early enough to treat? Research in Higher Education, 51(6), 546-572. doi: 10.1007/s11162-010-9170-7Time Ideas. (2012). 8 Ideas to Improve Higher Education. Retrieved from: http://ideas.time.com/2012/10/18/8-ideas-to-improve-higher-education/#slide/tie-funding-to-graduation-rates/?&_suid=13594909150780032817017170189644

U.S. Department of Education. (2002, November). Short-term enrollment in postsecondary education: Student background and institutional differences in reasons for early departure, 1996-98. Washington, DC: National Center for Education Statistics.

USA Today. (2013). Which colleges offer the best value? Retrieved from: http://www.9news.com/news/article/314987/339/Which-colleges-offer-the-best-value-

Vergakis, B. (2013). Feds’ loan changes hamper black college enrollment. Associated Press. Retrieved from: http://news.yahoo.com/feds-loan-changes-hamper-black-162929184.html

Wilmsen, E. (2011). Educational Policy Institute honors CSU with 2011 Outstanding Student Retention Program award. Today @ Colorado State. Retrieved from: http://www.today.colostate.edu/story.aspx?id=5727