Most people engage in comparison shopping before making a major purchase and a college education should be no different. It’s one of the largest purchases a family will ever make. And since the federal government subsidizes many of those purchases through grants and loans everyone has an interest in making sure that students get a good deal. That’s why Congress should require that financial aid offers are comparable across colleges so that families are equipped with full information about the cost of college options when choosing among them.
College-bound students lack the most basic necessities to make comparisons across colleges because they do not have reliable, comparable information about the net cost of college. Colleges typically provide information about cost and financing in financial aid award letters. The trouble is that each college’s notification looks different.
Students and families shouldn’t have to decode financial aid awards. The differences in out-of-pocket cost and student loan burden should be in bold print, not fine print. Congress should bring clarity, reliability, and uniformity to financial aid award letters just as it stepped in to bring more clarity to credit card offer letters and billing statements. After all, Americans now owe more in student loans than they owe to credit card companies.
The federal government could easily mandate a uniform financial aid comparison table that must be included in an acceptance and financial aid notification as a condition for receipt of financial aid funding under Title IV of the Higher Education Act. The table would make consumer choices more efficient and more informed at little or no cost to the government, the college, or the individual.
It’s time to stop letting colleges wiggle out of providing transparent, comparable information.
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