At first glance, you may think you don’t have any financial aid funds left, and you may say, “Well, we don’t have any more aid to allocate.” But be careful! That’s not going to increase your enrollment, and, could create extremely negative word-of-mouth marketing. And negative word-of-mouth spreads at least 250 times faster than positive word-of-mouth does.
Let’s back up a little. When the schools I worked with had some financial aid funds to allocate, they could do so either one student at a time, or wait until a large group of students had applied. That’s why most students applied early, since funds were typically awarded on a first come, first served basis, according to financial need. And, when the financial aid funds ran out, the schools had to answer incoming calls from parents and say they no longer had aid to distribute, which made those parents turn away and look for other options.
If you have budgeted financial aid to allocate, and you reach the point that you’ve allocated all of it, that simply means you can no longer allocate to one student or to one family at a time. You must wait until a number of parents have applied for their children to be accepted in your school, and have completed their respective application(s) for financial aid. This is also why it’s critically important to keep that enrollment pipeline filled! Marketing and enrollment is a year-round job! When you have a number of applications, you can determine the need of each student through FACTS Grant & Aid Assessment and discover what amount parents say they are able to pay for each of their children.
What you’ve been doing through most of the year is allocating financial aid based on a family’s financial need. When you run out of financial aid to allocate, the “allocation mindset” needs to shift to your school’s financial need, and you can start working on that “family ability to pay” side of the equation, so that their ability to pay fills your “need.”
The best demonstration is through an example.
- Let’s suppose your school’s posted tuition is $4,000 per student, and you have no financial aid funds left. However, you have $10,000 to go to make your yearly budget. There are six students that have applied for aid through FACTS: Three are from one family and have $3,000 of calculated need for each child, so each child could attend your school for $1,000.
- One is from one family that has $0 need, so the child could attend your school for the full amount of $4,000.
- The two other children need $1,000 each, so each could attend your school for $3,000.
If you were looking at each family individually, you would be able to accept the one child that had $0 need, but turn the other five away.
If you shift your focus to what a family can actually pay for the student, rather than what they need, you might find you could offer quite a bit of aid:
- The family with $0 need says they can indeed pay $4,000.
- The family with $1,000 calculated need for each student says they can pay only $2,500 for each child. Note that amount is $500 less than what their calculated ability to pay is.
- The family with three children says they can pay no more than $500 each (even though that’s $500 less per child than their calculated ability to pay).
With me so far?
Even though you don’t have financial aid funds to allocate, you could award:
- $100 in aid to the family that had $0 need (just because you really want to enroll their child), and award these funds as scholarship if the child qualifies for such a program at your school according to your school’s policies;
- $1,600 in need-based aid for each of the two children that had $1,000 of need, resulting in tuition of $2,400 each – which is even less than what the family said they could pay;
- $3,500 in aid to each of the children in the family of three, awarding MORE aid than their calculated need, but also meeting what the family said they could pay!
If you do that, you’d be collecting $3,900, $2,400, $2,400, $500, $500, and $500, which totals $10,200. You will have met your budgetary need of $10,000, have $200 in extra income (perhaps for additional aid for another family), and have not only met, but exceeded, the need of each of the families you’re working with here, creating a win-win-win situation.
The result – you’ve awarded $13,800 in financial aid without having $13,800 on hand to award, and you have six more students in your school.
Be sure to pair FACTS Tuition Management with Grant & Aid Assessment so your office can stop chasing tuition, and start chasing enrollment.