Student Aid Perspectives is an occasional, longer-format series designed to offer thought-provoking articles on current student aid topics written by expert authors. The opinions offered and statements made do not imply endorsement by NASFAA or guarantee the accuracy of information presented.

By Sara Goldrick-Rab

As experienced financial aid administrators know, the current financial aid system is highly bureaucratic and tightly regulated. As a result, it is also inflexible and often slow-moving. Not only is the application process complex, but the frequent need for verification and the time involved in processing requests often creates delays in delivering funds to students.

These system characteristics do not mesh well with the needs of today’s undergraduates. At a time when the price of college is higher than ever, need-based aid is more scarce, and many families are seeing their incomes stagnate or decline, students are having a great deal of difficulty obtaining financial help at the moments when they most need it. There is growing evidence that true emergencies—for example, challenges paying for basic needs such as housing or food—are more common than ever in higher education. For example, a new study of 33,000 students attending 70 community colleges in 24 states revealed that 33 percent of those students had the very lowest levels of food security, associated with hunger, and 14 percent were homeless.

Emergency aid is therefore a necessary tool in the modern financial aid office. It aims to deliver money to students fast, and to convey institutional interest in providing support in times of need. Both of those functions—the financial and the psychosocial—are critical. Granting $500 so that a student can pay their electricity bill while also imparting a sense of care can be an invaluable retention tool.

Over the past 10 years, I have studied thousands of moderate and lower-income undergraduates as they attempt to obtain college degrees, and I describe those findings in my newest book, Paying the Price. Most of those students were very careful with their finances, as they often grew up experienced in stretching to make ends meet. But the evidence is clear: money matters for student success, and timing makes a big difference. When students need textbooks, supplies for courses, or have financial holds, the longer they go without, the greater the chances they will leave college. The shortfalls in funding that they face during college are not always a new experience—economic volatility is a persistent facet in the lives of the poor. But the time constraints placed on students with classes to attend makes it harder to cover emergencies with more work hours, and turning to payday loans or credit cards for help seems especially risky to students who already borrowed student loans.

There are more than 500 colleges and universities around the country housing an emergency aid program, and the vast majority have operated those programs for at least three years. But there are thousands of other institutions without emergency aid programs, and growing evidence that an expansion of the practice would help students.

Practitioners around the country have developed approaches to delivering emergency aid using simple, accessible approaches that do not compromise students’ regular financial aid. A few years ago my research team at the Wisconsin HOPE Lab surveyed emergency aid program operators and learned from their experiences. [1] NASPA and the Great Lakes Higher Education Guaranty Corporation have conducted studies as well. Next, I review several lessons gleaned from that work, and offer five recommendations for effective program implementation.                 

1. Communication. By making emergency aid available, even in limited quantities, a college affirms that economic hardships among its students exists, and signals willingness to help. This can help reduce stigma and create a more supportive, trusting atmosphere. Advertising the program is crucial, since an unadvertised program tends to only attract the best-equipped students. Unfortunately, word-of-mouth is currently the most common method used for disseminating information about emergency aid. Of course, the risk in raising awareness is that the program will run out of funds—but the benefits exceed this risk. Simply note in the advertising that the program will support as many students as it can, and that fundraising efforts are underway to provide more support. Let faculty know of its existence. Keep a waitlist of students who cannot be served, and use this both to attract more funds, and also to evaluate program effectiveness (compare the served students to the waitlisted students).
2. Simplicity. Emergency aid programs should be distinct from regular aid, particularly when it comes to the application process. Students in financial distress should not be subjected to complex forms that could deter them from seeking support. Program administrators should develop a short list of key questions that will help them ascertain if the students’ emergency meets their criteria, and allow students to answer those questions either on paper or verbally, at the students’ choosing. Be careful about reserving emergency aid only for students who have maxed all federal aid or are in good academic standing, since this will reduce the ability to support students of color (who are more likely to decline loans) and those whose financial constraints are affecting their studies.
3. Timeliness. Delivery of emergency aid should be as fast as possible. Speed is critical, since the goal is not only to reduce the financial constraint but also the student’s stress so that they can return to a focus on school. Avoid the use of committees in this process whenever possible, and work with the institution’s foundation to deliver checks quickly.
4. Stewardship. Balance the need to deliver funds quickly with the need to be responsible with funding by utilizing multiple forms of emergency aid. Pre-purchase gift cards for gas, grocery stores, and other local stores to distribute as needed to students. Pay third-party bills directly for students, rather than offering cash. These sorts of funds should not be counted against students’ eligibility for financial aid.
5. Supplement. Emergency aid programs are necessary but insufficient, and should be supplemented by other forms of support. These should include: free on-campus tax assistance to help students not only complete the FAFSA but also draw down on the Earned Income Tax Credit and the refundable American Opportunity Tax Credit; a campus food pantry; assessment (perhaps by a social work student or financial aid student worker) of eligibility for support programs like SNAP and child care; and free legal advice. The co-utilization of these supports may help alleviate demand on the emergency aid fund as well.

Fundraising to support emergency aid programs should begin with alumni. Many students observe financial emergencies while in college, and summoning those personal recollections can provide motivation to give. Unlike traditional aid programs, alumni can make a difference with relatively small donations—even a campaign focused on $25 per person could lead to sizable growth in emergency funds. College foundations report that fundraising for emergency grant aid is not difficult, and savings generated from improved retention rates can generate savings to support emergency aid with core funding. Yet only two percent of institutions report that alumni giving is currently used to support their emergency aid programs.

State support may also be possible. Wisconsin Governor Scott Walker recently allocated funding for emergency aid in his biannual budget. States reconsidering the way in which their need-based grant aid programs are administered will be very interested in these lower-dollar, shorter-timeframe approaches.

One increasingly popular form of emergency aid are "completion grants." These programs are focused on students who are nearing the end of their degrees, but have run out of funds needed to cover tuition and/or fees. The approach aims to fill in just enough of the gap in need to keep them enrolled. But what we do not know is whether these efforts are the best use of funds. Most students leave college during their first or second year, often because of surprising financial challenges. Institutions should experiment with initial versus completion-based emergency aid, or use the two in tandem, to maximize effectiveness. The Institute for Education Sciences at the U.S. Department of Education is supporting a large program evaluation of completion grants implemented at ten urban-serving universities, and results will be available in a few years.

Many of us worked our way through college, and hope that students can too. But these days, jobs available for lower-skilled workers like undergraduates are harder to find, volatile, and they do not pay well. Prices are so high that without sufficient earnings, students must turn to loans, and even then, they may still fall short. This increased dependence on loans is risky for both students and institutions, which are held partly responsible for successful repayment. In some cases, providing an emergency grant may eliminate a student’s need for a loan—and may even prove more useful, since the funds arrive quickly. In other cases, emergency aid may help ensure that students remain in school and complete degrees, helping greatly increase the odds that they will repay their loans.

For these reasons, and because we all have a vested interest in ensuring that students not only start college but also finish, we need emergency aid as a tool in every college and university. It is a supplement that can help strengthen the efficacy of traditional financial aid, as well as other student support programs. Those operating emergency aid programs should work with those who currently do not to form communities of practice, learning from one another. Aid administrators should identify states that may prove interested in creating their own emergency aid programs, and the U.S. Department of Education should explore opportunities to do so at a federal level. A helping hand provided at just the right moment is an effective and meaningful way to create more student success, and emergency aid provides exactly that.

[1] Dachelet, K., and Goldrick-Rab, S. 2016. "Investing in Student Completion: Overcoming Financial Barriers to Retention through Small-Dollar Grants and Emergency Aid Programs." Wisconsin HOPE Lab report.

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Sara Goldrick-Rab is professor of higher education policy & sociology at Temple University, and founder of the Wisconsin HOPE Lab.

Publication Date: 3/13/2017

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