At age 18, students are making some of the most important decisions of their lives: where to attend college, which job to pursue and how much to invest in their future. The choices they make now have the potential to impact them for a lifetime – which is why it’s scary to see that most 17- and 18-year-olds have a “shockingly low understanding” of student aid, according to a survey from the ACT’s Center for Equity in Learning
The survey was conducted on 1,200 juniors and seniors who had registered for the ACT test, as reported by NASFAA
, and these are the key findings:
• Approximately 36% of those surveyed did not believe in taking on any debt in order to pay for college; however, 73 – 81% were not aware of subsidized student loan options in which the federal government pays all interest accrued while in college.
• When it comes to loan repayment, 67 – 70% were not aware of income-based plans that allow borrowers to pay back student loans in proportion to their annual salary after graduation.
• About 20% of survey respondents said they were financing their own education without any help from family, the highest percentage of those being first-generation and black students.
• Finally, the report found that college financial aid officers were highly underutilized, especially by low-income students. Of the Pell Grant eligible students and those intending to pay without help from family, only 40% and 46% had conversations with their prospective colleges about paying for college.
In the end, it seemed as if students that were wealthier and had more financial support from family and friends were more educated about and more willing to take on student debt in order to pay for college, according to the survey featured by NASFAA
So how can students better prepare themselves for conversations about student aid and paying for college?
First, students need to understand that there is no one to hold their hand through this entire process. It’s up to them, their parents and/or support systems to do the research, attend helpful financial aid seminars at their high school or prospective college and to compare options.
If student aid seems too overwhelming or complicated, seek out resources for help. Every college has a financial aid office with professionals knowledgeable and skilled in helping students pay for college with as little student debt as possible. Really. Their jobs are to help students understand AND get them the best deal possible. What’s more, these officers can help students get a realistic picture of their post-graduate student loan debt and repayment plan.
Financial aid officers can also point students toward scholarship opportunities, whether they’re provided by the school or university, local community or big corporations and philanthropic organizations. Furthermore, a financial aid officer can be a guide throughout the entire collegiate experience (and after). Annual – if not more frequent – conversations with a financial aid officer should occur, regardless of how much or how little students are depending on aid to pay for school.