Report Warns of "Dysfunctional" Financial Aid System

The U.S. Secretary of Education’s Commission on the Future of Higher Education recently issued a draft report warning that this country's financial aid system is "increasingly dysfunctional, inefficient and inadequate."

That's probably not news to anyone who has been grappling with the problem of paying for college for themselves or a family member. As the Commission's draft report points out, college costs have outstripped increases in family income for over a decade. The average cost of tuition at private schools rose by 32 per cent over the past ten years. Although public schools remain less expensive for in-state students, their costs have risen even more sharply, going up by 42 per cent. By contrast, median family income rose by only 3 per cent during the same period.

The Commission's report calls on colleges and universities to do more to control costs and recommends that the Federal Government completely overhaul financial aid programs that are “convoluted, complex and counterproductive.”

One important improvement, policy experts say, lies in giving students and parents a more realistic idea of what college attendance will cost them at an earlier stage of the admissions process. As things stand now, students and their families often do not receive this information until it is too late to re-think school plans or to explore alternatives.

Although it's welcome news to see that officials are paying attention to the problem of higher education financing, it is unlikely that any reforms will come out of this or subsequent reports in time to benefit anyone applying to colleges and universities this year. For now, college students and their families are best served by starting their financial aid search early and exploring every possible source of aid available to them.