Greater Access – A Discussion on the Newest Solutions for Affordability and Enrollment Challenges

1. Greater Access – A Discussion on the Newest Solutions for Affordability and Enrollment Challenges

2. Agenda for this Session • Trends in the Marketplace that Impact Affordability • Review of Models being Implemented from Four Schools Experience • Q & A

3. Affordability and enrollment strategy are top issues facing colleges today • 86% of college professionals surveyed are concerned about affordability and enrollment issues – Eduventures survey • College Alumni see affordability as an important issue – 48% of 350 graduate students surveyed – Opinion Dynamics Corp survey

4. Economic factors influencing college affordability • There is growing income inequality between the higher income segment (53% growth) v. lower income (5% growth) between ‘79-01 • Slowing economy, spending cuts at the state level • Less disposable income leads to an increase in debt burden (20% v. 24% from ‘79-03), decline in savings • While the ability to pay is declining, college price continues to rise – 94-95 and 04-05 – median income rose by 2%; college tuition rose by 59% at public 4-yr; 42% at private 4-yr

5. Impact of college enrollments on affordability • Enrollments will continue to increase, but the rate of growth will decline • The ability to attract your quality student will continue to be competitive 13% 20%

6. Changing student population may influence college affordability • Between 2000 – 2015, minority student growth is expected to exceed 50% while non-minority growth is only expected to grow 3% • Traditionally these students have been underrepresented, but they may have an impact • More low-income students will need financial help to offset the high cost of attendance

7. More students are requiring loans • From 01-02 to 04-05, the number of students taking out loans increased by 21% • Federal loans accounted for 62% of the $122B in aid received by students in 2004-2005

8. Student/parent debt loads are increasing

9. Financial literacy among students is a big concern • Less than 50% of high school students aren’t prepared to manage their finances • 45% of college students are in credit card debt – average debt - $3400 • College students spend ~30% of their monthly income on debt repayment – this is double the % spent in 1992 • Undergraduate students in the U.S. who borrow for education graduate with loan debt averaging $18,900; graduate school loan debt – $31,700; Private Medical School - $107,000

10. Default rates have increased • While default rates are at an all time low, slight increases should be watched closely

11. The role of financial aid is changing • Historically Financial Aid supported universal access and choice; now there is an increase focus on supporting enrollment and tuition revenue goals • Aid professionals have always worn many hats, but now they are required to be pricing experts and get more involved in the enrollment process • Required to be more tech savvy with limited resources

12. FAOs need to be involved in the decision making of their institutions • What FAOs bring to the table: • Represent the students • Are important to the retention of students • The only ones engaged in the entire student lifecycle

13. Challenges FAOs face in communicating with enrollment • Establishing common objectives among enrollment managers and financial aid • Working within a “Admission driven” institution • Balancing “Financials” with the institutional mission

14. Success in financial aid is “The Aid/Enrollment Officer” • Focused on Customer Service - have their finger on the pulse of the needs of their families and consistently exceed those needs • Team Players – equal partners with their admissions colleagues, in managing enrollment and retention goals • Data Driven – able to study and interpret the impact of financial need on enrollment behavior • Masters of Process Re-engineering - identify opportunities to streamline operations and improve current processes • Effective Communicators – with families, their colleagues; must be able to educate their leadership on the implications of certain decisions FAOS wear multiple hats and their role is evolving to one of enrollment management

15. Summary of Market Trends • Economic and environmental factors are adversely impacting students ability to afford college • Financial illiteracy of students is becoming a concern as they take on more debt and are unable to manage it effectively • The role of FAO is changing as the needs of students change • FAOs need to take a more active role in the decision making process of their institutions