Financial Aid Advice for
Middle-Class Students What to Do When Your Income Makes Finding Financial Aid Difficult

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Rebekah Salcedo Read bio

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Hannah Fattor Read bio

College applicants who are in the middle class are caught between low-income financial aid opportunities and full tuition costs, a gap that may explain why middle-class students enroll in college at a lower rate than both high- and low-income students. They and their families may make too much money to benefit from many income-based student aid offerings; however, they don’t have to resign themselves to paying full tuition prices that higher income students and their families can afford. From specialized policies and aid opportunities to repayment solutions, middle-class students at any stage of the college process can find funding options that can help make earning a degree possible below.

Points of View: Can Middle-Class Students Afford College?

In calculating a student’s federal student aid eligibility, the government employs a standardized formula with an Expected Family Contribution (EFC): a measurement of a household’s financial situation that takes into account family income, assets and benefits, among other factors. Schools see the resulting amount of federal aid that an applicant has available to them, and come up with a payment plan to present to the applicant. This strict limit for federal aid can complicate college payment options for middle-class students. Below are some potential scenarios that students might find themselves in when an EFC is higher than what a family can actually provide for a student’s post-secondary education.

Challenge

My EFC is too high for me to qualify for the amount in federal loans that I need.

Federal student aid is not the only source of financial assistance for students. There are scholarships available through colleges and private institutions that will fund students based on merit, interests and extracurriculars; potential careers; or demographics such as gender, race, ethnicity, or religion. Some examples are included below:

Also keep in mind, the EFC also depends on a student’s year in college, family size, and how many family members will attend college each year, so a student’s financial aid status may fluctuate throughout their enrollment.

Challenge

The colleges I’m applying to don’t offer enough student aid.

A college determines a student’s financial need by subtracting their EFC from the cost of attending that college. Going to a lower-cost school will not increase the amount of federal student aid that a student is eligible to receive, rather it will increase the impact of that aid.

Another option is to consider private colleges. Private institutions may offer greater amounts of student aid than public colleges. In 2017, the National Association of College and University Business Officers reported that 64 percent of private colleges in the U.S. used financial aid strategies and 20 percent used tuition pricing strategies to attract higher numbers of students to their institutions. This means nearly two-thirds of the private colleges in the nation are offering financial incentives to their students.

Challenge

My parents aren’t helping pay for college, it doesn’t matter what their income is.

Middle-class parents and students from middle-class families may think that keeping their income off a Free Application for Federal Student Aid (FAFSA) will help them receive more financial aid. However, the information provided on the FAFSA is used to calculate a student’s EFC, and this number is necessary to receive any federal funding assistance, whether parents plans to help pay for college or not. The Federal Student Aid website offers a few suggestions of how students can request their parents’ information for the FAFSA if they are a dependent, even if parents aren’t helping pay college costs.

Paying for College as a Middle-Class Student

If federal student aid is not enough to pay for a college degree, there are other financial aid options beyond standard scholarships and grants that students can explore. Read on to explore a range of funding sources and alternative, lower-cost education plans, as well as opportunities for students and their families to start saving for college early.

Parents can start saving for their children’s college payments through two different pre-tax, federal education savings plans : a 529 plan or a Coverdell Education Savings Account (ESA).

Colleges and degree programs may offer the opportunity to attend college as a part-time student. In 2017 alone, 37 percent of undergraduates attend college part-time. Though it requires careful planning to make this strategy work, academic and career advisors are available to consult with students at most colleges. It takes more time to complete a degree as a part-time student (depending on the amount of credits required to graduate), but being able to work part- or full-time during college can help offset the costs of tuition, living expenses and educational fees.

Increasingly, middle-class students are starting their college careers in community college. Community colleges are a great way to complete prerequisite courses in preparation for a four-year degree at a lower cost than attending a university for the full time needed to graduate with that degree. It is important to make sure that credits earned in a community college will transfer to other institutions—transfer credit regulations vary by school.

Enrolling in an online degree program allows students to learn on their own schedule, often for a fraction of the cost of an on-campus degree. These programs also allow students to complete classes anywhere they have access to an internet connection, and the quality of the education a student receives through an accredited online degree program is the same as any on-campus course.

Students who register for the SAT, ACT, and other standardized college entrance tests can use their College Board account to create a College Scholarship Service (CSS) profile. This method of applying for non-federal student financial aid is accepted at nearly 250 academic institutions and is used to award grants based on financial need. Unlike the FAFSA, students must pay a fee to submit their CSS profile to a college, though there is a fee waiver for low-income students. Through the CSS profile, students can provide a more thorough picture of their family finances and explain special financial circumstances.

State or federal loan forgiveness programs exempt graduates who work in specific service or nonprofit sectors from repaying their student loans. Federal loans can be forgiven through the Public Service Loan Forgiveness Program for graduates who work with Americorps, Peace Corps, or another qualifying non-profit. The Association of American Medical Colleges lists state loan repayment or forgiveness programs available to medical students. Medical professionals willing to work in rural areas can also have their loans forgiven by federal or state governments through the programs listed on the Rural Health Information Hub website.

Because they need to be repaid and accrue interest over time, student loans should be the last resort for funding a college education, but they are a common way of paying for a post-secondary degree. To learn more about student loans:

Middle-Class Students Considering Online College

As technology expands communication and education possibilities, academic programs increasingly take advantage of this new learning format to engage their students; 5.8 million U.S. students were taking courses online in 2016. It can be difficult to earn a degree online, but there are also reasons for middle-class students to seek out the flexible, less-expensive learning opportunities available through online degree programs. Check out some pros and cons below:

Cons of Online Education
  • Fewer interactions with academic professionals.

    Learning from and developing relationships with experienced professors is a valuable advantage in college. Face-to-face interactions with potential advisors and mentors can be limited by distance, time-zones, schedules, and technology. It is also more difficult to find internships and other work and academic participation opportunities. Developing physical tasks and social skills needed in certain fields such as nursing also becomes more difficult when classes are held online.

  • Missing out on “the college experience.”

    There is an image of what going to college looks like, beyond the academics. An online course does not offer the shared space or, often, the shared class scheduling of an on-campus degree program, and this does limit the social interactions available to online students who want to connect with peers as well as professors.

  • Challenge to maintain academic standing.

    A study of online versus in-person classes at a for-profit college found that students who took a class in-person outperformed the students who took the same class online by nearly a complete letter grade. It takes greater discipline to complete coursework and perform well on tests when not in a classroom setting, and it can be difficult to connect with peers for study sessions or editing help during a class. Online classes are ideal for self-motivated students, or students who can develop these skills quickly.

Pros of Online Education
  • Access to a range of classes and experts.

    An online course can be led by a professor who lives miles away, or on another continent. Online degree programs engage these experts remotely and bring their experience and knowledge to the online classroom in a cost-effective way. Even if an online class has low attendance, the college may still run the course because it is so inexpensive to the school.

  • Fewer expenses.

    The true cost of online learning may be cheaper than an on-campus experience. Most colleges require students to live on campus for their freshman year, and purchasing a meal plan as well as paying for the other perks available on-campus adds on to the overall cost of college. By taking online courses, students will not have to pay for these fringe benefits. Additionally, the cost of taking an online class is often far less than taking the same class on-campus.

  • Resources and opportunities to engage.

    Colleges that offer online courses should provide their students with the same academic advising, career assistance, and office hour opportunities that their on-campus students receive. This is not very difficult to do in an online format; students can video conference with professors, or chat though a live text window with a librarian. As colleges recognize the need for interaction and collective learning, some online degree programs are also working to bring remote classmates together and establish a space where they can interact with each other.

Financial Aid Policies Affecting the Middle Class

Making college affordable for middle-class students is a hot topic in the academic governing world, but there are no clear solutions addressing this issue. Below are a few of the areas of financial aid that students should pay attention to as tuition costs, enrollment numbers and student aid grant amounts all continue to increase.

Private colleges typically provide a greater amount of financial aid to enrolled students, as in 2017, when Cornell University expanded the eligibility requirements for reduced student loans to include middle-class students and increased the amount of grant aid available. However, public universities may have their own financial aid policies that can benefit middle-class students. For example, Pennsylvania State University has a grant-based—not loan-based—student aid policy that has been in place since 2014.

Many states offer a financial aid package to students who are middle- to low-income that is separate from federal aid. For example, the state of New York has created The Excelsior Scholarship to pay full tuition for middle-class students attending any public college or university in the state, and the Oregon Promise grant is merit-based and helps cover student tuition costs at Oregon community colleges.

However, state financial aid programs face difficulties when their funding decreases, tuition rises, or more eligible students apply for aid. Louisiana’s Taylor Opportunity Program for Students has awarded students with state aid since 1999, but has been subject to funding cuts as the state faces budget deficits. States must also balance the demographics of students who receive these awards, and often face criticism when grants are given to students who are not low-income. California has financial aid opportunities specifically for middle-class students who attend college at University of California or California State University campuses, but this award may be phased out because most recipients come from families that earn over $100,000 a year.

Progressive tuition models are emerging in some states to keep college affordable for low- and middle-income students. This model invests a third of the institution’s tuition income into financial aid for low-income and middle-class students. A 2016 study reported some success with this model, as the amount of aid a school can offer to students will increase proportionally with tuition increases.

The practice of tuition discounting is controversial, with critics insisting it is not a financially sustainable system for colleges. This model offsets the amount a student pays for college tuition with institutional grants for certain students, but is presented as a reduced tuition rate to the student. These discounts are based on merit and do not take financial need into account, which can benefit middle-class students.

Keeping College Affordable: Advice from a Scholarships & Financial Aid Director

Rebekah Salcedo, Ph.D., is the Executive Director of Scholarships and Financial Aid at The University of Arizona. She is an enthusiastic, results-driven higher education professional, dedicating her time to student scholarship access and success. She received her undergraduate degree in Liberal Studies from Marymount University in 2004, then went on to earn a master’s in Human Services from Capella University and her Doctor of Philosophy, Higher Education degree from the University of Arizona in 2012.

Q: What do you advise students to do when their parents’ income excludes them from significant federal financial aid?

Students and families who do not qualify for Federal Pell Grants and Institutional need-based aid have several different options including scholarships, Federal Work Study, Federal loans for students, Federal loans for parents, private educational loans, and family savings and out-of-pocket payments, including payment plans. It is critical that families are informed about their different options in order to make the best decisions for them—both in terms of institutional cost and payment options.

Q: What are some ways that students can be proactive in funding their own college education?

Every Title IV eligible school in the country is required to have a Net Price Calculator. This tool helps future students and families estimate costs like tuition, fees, books and living expenses. College savings accounts offer opportunities to save for their education. In addition to fully researching the costs and aid options at different institutions, students can use college savings accounts and also look for scholarship opportunities starting as early as middle school. Students can begin building a resume for colleges by joining groups and service organizations that offer scholarships, such as 4-H and Scouts. Searching for scholarships does not end after a student’s senior year of high school. Students should continue to look for scholarship and work study opportunities while in enrolled in college.

Q: What changes have you seen in recent financial aid trends that positively affect students from middle-class families?

With all the media attention on college costs and the potential dangers of over-borrowing, I believe today’s consumers ask more questions and search out more scholarship opportunities than before. They are understanding the incredible value a public education provides and the increased earning potential that results from a college education.

Q: What changes have you seen in recent financial aid trends that negatively affect students from middle-class families?

The loss of subsidy in loans for graduate students means that the only federally available loan options for graduate students are unsubsidized.