Article by Matthew Matthew Maillet
Last year, universities increased spending on financial aid at an average of 9.3% while tuition rose by just 4.3%. However, there is a great deal of curiosity about what colleges plan to do for the coming academic year. While most universities report their financial aid budgets in February, most economists believe that tuition assistance spending will dramatically decline.
Private universities rely on their endowments to cover operating expenses. The economic recession of 2009 took a huge toll on many private university endowments. For example, Dartmouth reported a $835 million decline in the school endowment. Because of this, schools are forced to find other ways to meet their growing operating expenses. One easy way to raise capital is by cutting down on financial aid.
It is important that students take advantage of outlets that are still helping with tuition costs. For example, many federal financial aid programs such as the Perkins loan and SEOG grant will still be an excellent resource for tuition assistance. Beginning in January of next year, students will have the opportunity to utilize the Free Application for Federal Student Aid (FAFSA.) This will make it much more convenient for students to apply for federal and state aid while not costing them a dime.