Financial Aid Nonprofit Works to Make College Affordable

By Douglas Fehlen

Jessica Schmidt Bonifant

Many of today's higher ed students are finding themselves in a difficult position. College costs are rapidly escalating upward, while a bad economy is causing many sources of financial aid to dry up. As more students struggle to finance a degree, financial aid nonprofits are more important than ever. Baltimore-based Central Scholarship Bureau (CSB) is one such organization working to make college affordable. Development Director Jessica Schmidt-Bonifant works with donors and program staff to help make college a reality for those students who might otherwise be unable to attend. Central Scholarship Bureau received about 5,300 financial aid applications in 2011. How does this figure compare to totals from years past? Does this change correlate with current trends you see in higher education funding?

Jessica Schmidt-Bonifant: This was a record-breaking year for us; we almost doubled the number of applications that we received in 2010. For us, the increase is due, in part, to a change in our outreach strategy. We have put more effort into reaching students across the state and have steadily grown our contact list. We now have over 10,000 contacts that we connect with each year.

That said, there are definitely more students looking for financial assistance. Between institutions offering less financial aid and steady increases in tuition and fees, students have fewer options for financial support. Your organization will award more than $1 million in financial aid this year. How many students are expected to receive awards? How are recipients of scholarships, grants and interest-free loans selected?

JSB: We just finished up the selection and awards process, and we are pleased to say that 250 students will receive scholarships or interest-free loans from us this year. We have close to 40 different scholarship and loan programs, many with their own list of specifications. From funding bilingual graduate students to undergraduates from certain high schools, our programs vary greatly.

The application window opens in January and students have four months to apply online for our funding. From there, our program department selects the top candidates for each program. The top candidates are interviewed and then the selection committee selects the students that are the best fit for each program. The National Center for Education recently revealed that the Class of 2011 is the most indebted in the history of U.S. higher education. Can you talk about college tuition and financial aid trends contributing to this situation?

JSB: We've also been following this research and it is certainly an alarming statistic. I think that there are a lot of different factors that have created this perfect storm for the class of 2011. One thing that we try to address here at CSB is a lack of understanding about the cost of college and how to finance it. We've spent countless hours with students and parents who are confused about the financial aid process and often 'sign on the dotted line' without fully understanding the financial aid awarded.

We want students and families to become better consumers of higher education. This means helping them to understand what their student loans really mean for their future and helping them to figure out better ways to invest in their education. The Central Scholarship Bureau holds an annual event called 'Financial Literacy Day.' Can you explain what this event is designed to achieve?

JSB: In 2010, we offered our first student financial literacy seminar. After interviewing and communicating with our students, we realized that many were unprepared for the financial decisions they were going to be faced with. Our goal was to arm them with the financial know-how they would need to make these important decisions.

This was the second year that we hosted our Financial Literacy Day and we consider it to be a great success. Initially, we wanted to host a brief seminar for our students that addressed challenges and pitfalls that they may come across once they enter college. This year we expanded the seminar so that it addressed everything from student loan debts to creating a budget and avoiding common credit card pitfalls. We also expanded the day to offer different tracks and courses for students. Our students vary in ages and experiences so we wanted to offer classes that would appeal to all students.

We concluded with a panel of industry experts to help students understand what employers are looking for during the hiring process. We hope that the students who attended can use the information to better understand what college is costing, how much they've borrowed, what they can expect to make when they graduate and how all of that must be managed in their personal budget. Based on the feedback that we received, we hope to expand the program even further in 2012. Many studies suggest that college is becoming increasingly unattainable for students from low-income and middle-class households. What advice do you have for students who feel priced out of higher education?

JSB: I would suggest applying for every scholarship that they can. Even if the student feels that they barely have a shot, go for it. You never know if a scholarship committee will see something in you that will make you stand out from the crowd. Talk to your guidance counselors and your financial aid officers to see if they know of any scholarships to apply for.

Also, complete the FAFSA, the federal form that you need for all federal and state aid, as soon as possible after January 1st. Even if you think college is unaffordable for you, apply and complete the FAFSA anyway; you may not realize what aid options are out there. Don't listen to your friend who tells you won't get any aid because he/she didn't - everyone's circumstances are different. For students who don't receive a sufficient aid package from the school of their choice, it's important for them to know that they can contact the financial aid office to request a professional review of their circumstances, with the possibility of receiving more funding. This is especially applicable to students experiencing financial hardship (such as loss of parental employment or family medical issues) that might not be reflected on their FAFSA or tax return.

I'd also suggest closely evaluating the college or university they've chosen. Is there a more affordable school that offers the same major? Is there a closer school so they could live at home? Community college can be a less expensive option for the first two years, but it takes careful planning to make sure your classes will transfer to the 4-year college of your choice. Have you noted any positive trends that provide hope we'll one day get past current funding challenges in higher ed? If not, what policy changes would you advocate for that could improve the crunch?

JSB: At CSB, we've noticed a recent recognition that the traditional 4-year, full-time, on-campus model no longer suits everyone. So that we don't lose the talent in our community, schools are starting to look at options to fit the nontraditional student and the student who has to work; these options include online classes or certification programs in specific career fields. Unfortunately, in the current economic climate, we are unlikely to see any increase in federal or state funds.

It seems that the scrutiny of for-profit colleges and things like job placement rates at law schools have kickstarted a national conversation about the value versus the cost of a degree, which is an important dialogue that needs to be happening. CSB works with about a dozen community partners. How do you work with other organizations to improve access to higher education?

JSB: We feel very fortunate to work with so many great community partners. Our approach in working with these partners is to ensure that the students we're helping have full wraparound services. Generally, our partners provide mentoring support to students who may have been incarcerated, come from broken families or have been in foster care. Our partners provide the students with the support they need to succeed in school and we provide the funding for their education. We've found this method to be very successful. Current economic challenges have led to a reduction in charitable donations. Have you observed declines in individual, corporate and nonprofit giving? What is the outlook for organizations devoted to funding students' higher education?

JSB: We consider ourselves to be incredibly fortunate. In this challenging economic climate, our donors have stepped up and continued to provide funding for our students. We are very proud of the fact that we have consistently committed over $1 million to students in 2009, 2010 and now in 2011.

Our staff and board continuously look for new ways to bring in funding and to find new ways to increase the number of students we're helping. I think we've largely been so successful because people value and understand the importance of education. We are helping these students to create a future for themselves and their families, which will improve our community as a whole. We are helping them to break the cycle of poverty that may have held back their families for years. To quote an age-old fable, we are teaching them to fish, so they can feed themselves and their families for a lifetime.

I think the outlook for higher education is a challenging one, but an encouraging and exciting one as well. Postsecondary education is expensive, but the impact on individuals, families and communities is extraordinary. Our donors understand that education is the key to many of life's problems and they are willing to invest in our students. Many people are in the financial position to donate because of their education and they understand, from their own experience, the undeniable importance of it. You're active on Twitter. Can you talk about the role of social media in your work as Central Scholarship Bureau's Development Director? Does your organization utilize social media in other ways for public outreach?

JSB: Twitter is great! We've found that it's a great way to connect with the broader higher ed community. We've had some great exchanges with organizations we otherwise would have never connected with. I've found it to be a great resource for current research and news articles.

In the past year and a half we've really ramped up our social media efforts. We've found that social media is an important tool for us, primarily for our students and community partners. It is a great way for people to connect to us and hear from us in a more casual, conversational way.

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