11/4/2011 1

Financial Aid’s Challenge of Recruiting and Retaining Today’s

Demographic while Balancing Increased Scrutiny of Metrics and

Scorecards

Presented by:

Rod Andrews – Associate Director of Financial

Aid, University of West Florida

Mike O’Grady - Financial Aid Services & SASFAA

Diversity Committee Chair

Francisco Valines – Director of Financial Aid,

Florida International University

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Why should Financial Aid Offices Care about “persistence?”

1) Accountability - Accountability - Accountability

2) National discretionary budget has a bull’s eye on it

3) Huge waste of tax payers’ money when students don’t graduate

4) “Stop outs” are less likely to pay their student loans (University of MD

study found that stop outs were 3.7 times more likely to default)

5) Default rates are up 6 years in a row

Race for Retention

New Race Participants

Source: Lumina Foundation

Non-Hispanic white population will increase

by 10.2 million by 2020

African-American population will increase

by 9.5 million by 2020

Hispanic population will increase by 24.1

million

31.1 %

12.6 %

17.6 %

% that have a

college degree

11/4/2011 2

Running into the Wind

Decreasing traditional college bound population

Worst economy since the Depression

Budget freezes on all levels

One out of four homeowners is in a negative equity

position or no equity position

Filling seats and keeping students from a new demographic

Unfriendly Finish line

By 2020 65% of all jobs will require postsecondary education

In 1993 the average student loan debt load (in today’s

dollars) was $14,500

In 2011 the average student loan debt load was $26,600

In 1999 the default rate was 5.6%; in 2010 the default

rate was 9.1%

3 Year 2010 default rate was 14.7% up from 13.5%

Relationship between Enrollment & Cost

Source: College Board TiSA 2011

11/4/2011 3

Proximity to College

Changes in Bachelor’s

Degree Types Received 1998–99 2008–09 1998–99 to 2008–09

Field of study Number Number

Change in

number of

degrees Percent change

Bachelor's degrees Total1 1,200,303 1,601,368 401,065 33.4

Parks, recreation, leisure,

and fitness studies 16,532 31,667 15,135 91.5

Security and protective services 24,601 41,800 17,199 69.9

Visual and performing arts 54,404 89,140 34,736 63.8

Communication and communications technologies 52,460 83,109 30,649 58.4

Business 240,947 347,985 107,038 44.4

Health professions and related clinical sciences 85,214 120,488 35,274 41.4

Family and consumer sciences 16,059 21,905 5,846 36.4

Multi/interdisciplinary studies 27,545 37,444 9,899 35.9

Liberal arts and sciences, general studies, and humanities 34,772 47,096 12,324 35.4

Social sciences and history 124,658 168,500 43,842 35.2

Foreign languages, literatures, and linguistics 15,821 21,158 5,337 33.7

Psychology 73,636 94,271 20,635 28.0

Biological and biomedical sciences 64,608 80,756 16,148 25.0

Computer and information sciences and support services 30,574 37,994 7,420 24.3

Physical sciences and science technologies 18,285 22,466 4,181 22.9

Public administration and social service professions 20,287 23,851 3,564 17.6

Engineering and engineering technologies 72,445 84,636 12,191 16.8

English language and literature/letters 49,800 55,462 5,662 11.4

Agriculture and natural resources 23,916 24,988 1,072 4.5

Education 107,086 101,708 -5,378 -5.0

Changes in Associate’s

Degree Type Received 1998–99 2008–09 1998–99 to 2008–09

Field of study Number Number

Change in

number of degrees Percent change

Associate's degrees Total1 559,954 787,325 227,371 40.6

Psychology 1,625 3,949 2,324 143.0

Social sciences and history 4,550 9,142 4,592 100.9

Security and protective services 17,430 33,033 15,603 89.5

Multi/interdisciplinary studies 8,661 15,459 6,798 78.5

Health professions and related clinical sciences 93,218 165,163 71,945 77.2

Physical sciences and science technologies 2,399 3,617 1,218 50.8

Communications and communications technologies 5,167 7,525 2,358 45.6

Liberal arts and sciences, general studies, and humanities 181,977 263,853 81,876 45.0

Education 10,165 14,123 3,958 38.9

Computer and information sciences 22,445 30,006 7,561 33.7

Business 95,897 127,848 31,951 33.3

Family and consumer sciences 8,063 9,020 957 11.9

Public administration and social service professions 3,881 4,178 297 7.7

Biological and biomedical sciences 2,213 2,364 151 6.8

Visual and performing arts 17,640 18,629 989 5.6

Legal professions and studies 9,133 9,062 -71 -0.8

Precision production 2,201 2,126 -75 -3.4

Foreign languages, literatures, and linguistics 1,705 1,627 -78 -4.6

Engineering and engineering technologies 57,292 52,933 -4,359 -7.6

Agriculture and natural resources 6,632 5,724 -908 -13.7

11/4/2011 4

The ED Finance Challenge The difference between college and a can of Coke

Permanent Income Hypothesis

People don’t spend based on their “current” income

but instead on their permanent income

Students have distorted perceptions about

borrowing and future income

They underestimate debt and overestimate income

potential (Source: Carlo Salerno, PHD)

How Colleges Function Colleges are NOT factories. They don’t produce

“graduates” the way General Motors produces cars.

Instead, colleges behave (at least on the educational

side) like health clubs.

The important aspect of the health club model is that

responsibility for education production lies with the

patron, not the firm providing the service.

For many students, the objective is not to get an

education, but to get a credential (Source: Carlo Salerno, PHD)

Obstacle Course! Institutions lack a great deal of control over many facets of education production and post-graduate employment.

Borrowing – no mechanism to limit at school level?

Caliber of Students – 2/5 unprepared?

Major/Career Choice – Hooray more students in leisure

studies.

Academic Performance – No more in loco parentis.

Completion Timeframe – Avg student changes majors 3x

and 80% do it at least once?

Future Earnings – College credential is not the only

factor shaping who gets what job.

11/4/2011 5

Student Effort

Student Effort (cont.)

Student Effort (cont.)

11/4/2011 6

Student Effort (cont.) The average student skips about 104 classes over

their college career – the cost is about $2,400

($6,600) at a public (private) institution.

That’s about $2,400 in grant aid blown on skipping.

Students who waste time are about 3x more likely

to find themselves unemployed after leaving college

and about 2x more likely to live back at home with

their parents again.

(Source: Carlo Salerno, PHD)

Retention Funnel

A

D

M

I

T

T

E

D

Recruiting students that don’t

matriculate is extremely expensive

and is a “lose-lose” proposition. G

R

A

D

U

A

T

E

S

A

L

U

M

N

I

Freshmen Sophomores Juniors Seniors

According to Thom Golden from Vanderbilt University, non-traditional students don’t enroll often due to:

Concerns over affordability and Lack of clarity around

eligibility

According to ACE- 1.8 million low-income students would received financial aid but didn’t apply

Financial constraints are the #1 reason given by 50% of

students who drop out. What is the real reason?

Financial Aid’s Role

11/4/2011 7

From: The Cost of College Attrition at Four Year Colleges & Universities, EPI Policy Perspectives, Feb. 2013

Real reasons

students leave

higher

education

Out of Shape!!!!

Can’t Afford Retention Initiatives???

•Dr. Raisman study: More than half of schools get failing grades for retention (“D” or “F”)

•Private schools lose $8,331,593 on average

•Public schools lose $13,267,214 on average

Based on Vincent Tinto’s research,

there are formal and informal

systems that influence success

11/4/2011 8

Systems Impact Academic engagement

Student Support Services

Faculty and staff interactions

Student Community

Financial aid staff can impact both formal and informal

systems through intentional focus on debt burden, time

to degree, and breaking through silos - using structure

and culture to enhance outcomes.

Practical Structure Short-term and standard course sequencing

Students start together and stay together (cohorts)

Block scheduling of coursework

Structured career-specific curriculum

Remediation built into coursework

Tutoring by faculty and peers

Hands-on teaching and learning

Integration of workplace experience

Stable full-time staff

Cultural Student success and retention are consistent themes, and produce integrated solutions (collaboration)

Commitment to student success is an important

consideration in hiring

Caring community– institutional and personal

Staff and faculty members are committed to helping students

Maintain focus on quality and accountability

Consistent advising and counseling

Systemic and continuing efforts to improve student graduation rates

11/4/2011 9

Successful Outcomes

Shorter time to degree reduces costs/debt

Campus wide efforts needed

Loan counseling integrated with academic and

career guidance through access to data

More intrusive counseling and outreach based

on assessment of risk

Practical Suggestions

• Reminders to FAFSA filers who do not refile

before state deadlines

• Package for full time attendance

• Project monthly debt by academic program

based on completion data

• Provide training to career and academic

counseling staff regarding aid limitations (Pell

grant limits, aggregate debt)

Retention Pays A small private college of 1000 students in New York State with 43% of its

students Pell eligible instituted an early identification and automated alert system to improve retention.

Spring 2010 to Fall 2010 they retained 36 students more than the

previous year.

Fall 2010 to Spring 2011 they retained 39 students more than the

previous year.

Spring 2011 to Fall 2011 they retained 59 students more.

Fall 2011 to Spring 2011 they retained 70 students more than the

previous year.

Total Net Revenue: More than $2 Million dollars.

11/4/2011 10

Model of Communication

Sender Encoder Decoder Receiver

“The Medium is the Message”… Marshal McLuhan

E-Mail

Facebook

Twitter

Net Price Calculator

Dynamic Award Letters

Snail Mail

Direct Mail

Phone

Internet

Campus Visits

GPS all the above through automatic communications.

College “Culture Shock” &

Veteran’s PTSD/I Awareness

Introduced by 1954 by Kalvervo Oberg

Normally a student blames his or her “financial aid” as the reason

for leaving school.

Difficulty in assimilating to new culture and environment

Anxiety, disorientation, uncertainty, confusion

Phases: Honeymoon Phase - Negotiation Phase - Adjustment

Phase (things become “normal”) - Reverse Culture Shock

11/4/2011 11

Veterans and Post Traumatic

Stress Disorder/Injury (PTSD/I)

Re-entry issues for veterans often result in alcohol abuse, drug abuse, family or marital problems or suicide.

Symptoms of PTSD may include anger and irritability,

“spacey stare,” short attention span, confusion, trouble

sleeping, and “self-medicating”.

What is your SAP policy regarding PTSD?

Veterans and Post Traumatic

Stress Disorder/Injury (PTSD/I) continued..

One in five veterans will experience re-entry

issues or possibly PTSD/I

Approximately 200,000 women served in

Afghanistan and Iraq

23% to 33% of women veterans report

experiencing “MST” of which 42% will acquire PTSD

Internal Champions/Task Force –

Consider a “One Stop Shop”

Admissions

Financial

Aid

Multicultural

Affairs

Veterans Affairs

Student

Accounts

Psychological

Services

11/4/2011 12

Transfer work-load to where interpersonal skills

are needed

Reduce rote tasks

24/7

Institution can become

bilingual

Consistent brand management

Mitigate budget cuts

Go Green

Use analytics as your GPS

for default management

Diversify your staff - age, sex, and ethnicity

Technology, Technology, Technology

Leverage resources from the Department of Ed

Benchmark with your peers constantly

Acquire cross-cultural training

Create a financial literacy culture

• http://www.tgslc.org/pdf/Balancing-Passion-and-Practicality.pdf

• http://www.tgslc.org/pdf/Graduate-High-Risk-Students.pdf

• Contact us?

• mogradyva@hotmail.com 703-906-7318

• randrews@uwf.edu 904-474-3132

• valinesf@fiu.edu 305-348-2333