Juana Sánchez and Lara Couturier
May 6, 2021
Important changes to federal student aid are on the horizon. The Consolidated Appropriations Act of 2021 simplifies the Free Application for Federal Student Aid at long last, reducing the number and complexity of questions that students and families must answer to determine their eligibility for federal aid. The bill package also includes provisions that make student eligibility for the Pell Grant more predictable while expanding access to the maximum award for independent adult students.
Building upon this momentum, President Biden announced last week his American Families Plan, which proposes to increase the maximum Pell Grant award by approximately $1,400 to help low-income students better finance increasing college costs. These structural changes and investments are good news for today’s students, many of whom struggle to navigate complex financial aid application processes and obtain the aid needed to bring their college goals within reach.
As promising as these federal policy developments have been, we can’t help but note that at least one key lens is missing: how financial aid must be redesigned to keep up with today’s highly mobile students. We know that 38 percent of first-time students change institutions within their first six years, and nearly half of all bachelor’s degree holders complete some credits in community colleges. In addition, 34 percent of all students earn some college credits in high school, and another 35 percent of students earn credits online, likely transferring these credits as they advance in their educational journeys.