Study shows low-income families receive less college scholarships-what families can do

By Kelly Carrion, NBCLatino

A new study, “How America Pays for College,” conducted by Sallie Mae, found that students from wealthier families are more likely to receive larger scholarship awards than low-income families.

The report shows that 36 percent of families with an income of $35,000  or less receive an average of  $7,237 a year in scholarships while 35 percent of families making $100,000 or above receive  $10, 213 a year.

“For Latinos specifically, we are much more likely to be of low income, so the ability to have need- based aid is very critical,” says Deborah Santiago, the Vice President for Policy and Research at Excelencia in Education.

Santiago says these numbers consist mostly of merit-based scholarships rather than need-based aid.  In a report released in May by the New America Foundation, data shows that public and private colleges are shifting their scholarships to mostly merit-based – rather than need-based – aid.

According to the study, colleges are doing this because they are in pursuit of prestige and revenue. Colleges are seeking brighter students and students that will be able to pay the full price. An example they use is, “it’s more profitable for schools to provide four scholarships of $5,000 each to induce affluent students who will be able to pay the balance than it is to provide a single $20,000 grant to one low-income student.”

So what should low-income students do now?

Families need to prepare more and do thorough research of all the financial resources that colleges and other institutions provide. Students and their families should make use of resources in their schools and communities as well as websites to obtain information on different scholarships available. One is the Latino College Dollars tool provided by the Hispanic Scholarship Fund.  Another helpful website on how to apply for college and financial aid is  New Futuro. 

“Increasing your academic preparation is important and getting good grades is vital, the other is choosing intuitions of higher education that have more institutional aid and support,” says Santiago.

A study by Georgetown Public Policy Institute shows that minority students are less likely to attend top level universities compared to white students. Santiago believes that financial aid and other mitigating factors are to blame – and in many cases, students do not know there is aid available.

“The challenge, I think is the sticker price of those [top level] institutions.  They do offer merit-based aid, but the sticker price is very high and discourages low income Latino students from enrolling there.   But the students do not know they could not just get federal aid but other institutional aid, so instead the student chooses to go to community college instead of a four-year college,” says Santiago.

Another issue, Santiago says, is that these institutions are not doing a better job at recruiting low income minorities.  In addition, it is important colleges not only focus on the number of students of color they enroll, but on how many they retain to completion and help them integrate into the school along the way. “They [colleges] have not thought strategically on what they are doing, it’s more cost effective to keep a student than to keep recruiting them,” says Santiago.

This article was first published in NBCLatino.