What do we know about the impact of the design, operations, and marketing of financial aid programs on college enrollment?

It has been well-established that the price of college and the availability of financial aid influences students’ college-going decisions, especially with lower-income and minority youth. The amount of financial aid is a huge factor. But what role, if any, is played by the way financial aid programs are designed, run, and marketed to students?

Several research studies have demonstrated that middle and high school students and their parents frequently overestimate the price of college while underestimating the availability of financial aid. To counteract these misperceptions, policy makers, advocates, and researchers have recommended creating marketing campaigns to publicize the affordability of college and redesigning financial aid programs to make the actual price of college more easily understood.

In part, these recommendations are based on knowledge gleaned from commercial marketing research. Complex and difficult-to-understand products and services are less likely to be understood by consumers and more importantly, less likely to be successful in the marketplace. In the case of financial aid, the students most in need may not use it because the types of aid and the processes for securing it are hard for them to grasp.

To better understand the possible role of marketing and simplification efforts in increasing the effectiveness of student aid programs, TERI, with support from Lumina Foundation for Education, recently commissioned research reviews to identify what is known about the impact of financial aid program design, operations, and marketing on the perceptions of lower-income and minority youth and their parents. The reviews concluded that little, if any, research exists on these important issues.

It is clear that more research is needed to understand how students and families perceive financial aid, and how changes in financial aid program design, operations, or marketing can influence critical college-going decisions.

For accompanying literature, click on the hyper-linked report below. Clicking on any of these links will open up a PDF document.