How Will the Coronavirus Pandemic Affect College Financial Aid?
COVID-19 Series The Princeton Review
I’m Rob Franek, Editor-in-Chief at The Princeton Review.
Thanks for joining me here today.
Right now, there are many things you’re probably worried about:
The health and safety of your family and friends, foremost
Your school work and finishing up the academic year
Your plans for the future, including: Whether the SAT and ACT exams will be permanently
canceled Whether your at-home AP exam will be a fair
and accurate assessment of your abilities Whether you’ll get into college!
And when you do get in, how you’ll pay for it.
Folks, that last topic is what we’re here to talk about today.
There are a few different threads I want to weave together.
First, let’s talk about colleges’ own financial circumstances.
The picture’s not great for them, my friends.
First, the stock market downturn has significantly affected their endowments.
Add to that the fact that, at some schools, enrollments—and therefore tuition dollars—are
down.
Plus, many schools are refunding prorated room and board fees to students who are no
longer on campus.
And they’re paying hefty fees to deep-clean dorms and other campus buildings.
Lots of schools are continuing to pay student workers.
In the meantime, sporting events and other revenue generators have all been canceled.
Private donations are likely to be down, and the same goes for public revenues.
Plus, creating and running an effective online program also comes with a cost.
There are a few opportunities for some cost savings; for instance, large, expensive events
like commencements are being canceled.
But overall, colleges are facing unprecedented financial challenges.
And with many students and parents in very tough financial straits themselves, schools
are looking for ways to increase the aid they offer.
Simply put: There’s less coming in, and more that needs to go out.
This is not a sustainable situation—and we are all hoping it won’t continue.
For now, schools—like the rest of us—are taking it one day at a time, dealing with
the most urgent needs first, and setting aside the rest for later.
In the long term, we do expect to see some school closures or mergers.
But for now, with everything in a state of suspended animation, colleges’ own lenders
seem poised to be flexible, and higher education leaders are actively looking for ways to be
efficient and effective.
Now, from students’ perspectives—here are things you need to know.
For starters, if your financial situation has changed (and this is whether you’re
a college-bound senior or a current college student), please reach out to the financial
aid office at your school.
Be polite, be kind, and be forthright.
The folks in those offices care deeply about their students.
They want you to continue your education, and they want you to continue it at their
school.
They will work with you to the greatest extent they can.
It’s likely that if your financial situation has changed—and
it has for so many students—it will, I hope, change again for the better.
And in that case, the
school will probably want
to re-revisit your
financial aid award down the road so that it always suits your circumstances.
Another thing we’ve been asked about: student loans!
The recently passed CARES Act (that stands for Coronavirus Aid, Relief, and Economic
Security) will temporarily pause your federal student loan payments for six months—that
happens automatically—for both your principal and interest.
If you can still make payments, you may want to—but you don’t have to.
(Keep in mind that this doesn’t apply to all federal student loans, and it doesn’t
apply to any private student loans.)
To get information about the CARES Act—go to studentloanborrowerassistance.org.
The full text of the act is published on the government site.
The bottom line is: If you’re worried about how you’re going to make your federal student
loan payments right now, for many of you, you can set those concerns aside.
Now, here’s another bit of good news: If you have a dream school that you’re hoping
to attend, you may actually have an edge right now.
Enrollments at many schools are at best more unpredictable than they usually are.
So if you would definitely enroll at your dream school if admitted—either off the
waitlist or in the regular admissions cycle—let the school know that!
Your chances of getting in may be better than ever.
Also look at the enrollment picture from the college’s side: The schools, as always,
are eager to fill their first-year class for the coming year, and likely more so this year.
Hundreds have even pushed back their deposit dates to give students more time to decide.
With lots of students now keen to stay closer to home, the schools may not be attracting
as many out-of-state students or, simply put: students who live many miles away from the
schools.
Here’s what all this math adds up to: Your chances of getting in to a school (near to
you or farther away)—and once in, your chance of getting aid—may be better than you think.
Here’s my advice to you: Be hopeful.
Be kind to yourself.
Take care of yourself.
Send at least one nice email or text to a friend or family member each day.
Take advantage of the changes that benefit you—for example, the student loan pause—and
try to hold steady amidst the changes you can’t do anything about.
We’re all in this together.
We share common goals.
You will get through this.
Take care.