Can texting get students more financial aid?

Try asking a high school senior what’s more difficult — AP Chemistry or completing a FAFSA (Free Application for Federal Student Aid). You might be surprised just how confusing the financial aid process is for students.

Today we are excited to launch the NextGenVest College Money Mentor, a free SMS service that helps students navigate the financial aid process through text message reminders and on-demand guidance.

The financial aid application process is broken

$2.9 billion of financial aid for qualified students went unclaimed in 2014. This represents the amount in Pell grants (money that doesn’t need to be repaid) that could have been awarded to students that meet the requirements.

In New York alone, $182 million was left on the table in free financial aid. Ouch.

It’s not like students don’t need the money

College tuition continues to rise. The growth in the price of a college education has grown much faster than prices in many other categories, including inflation.

Average total tuition at a private, non-profit, four-year college was $42,419 for 2014–2015, up from $30,664 in real dollars in 2000–01.

College Board, 2013. More here.

Not surprisingly, student loan burdens continue to be staggering. The average college graduate owes approximately $35,000.

So why are students leaving free money on the table? 3 reasons:

1. Lack of personalized guidance. Nationwide, 1 in 5 high schools lack a school guidance counselor.
2. Complex forms that students don’t complete: The FAFSA (Free Application for Federal Student Aid) is a key financial aid document that is notoriously confusing. President Obama has made strides to simplify the form and required tax documentation, but there needs to be more simplification.
3. Hard to manage deadlines: Financial aid is disbursed on a first come, first served basis. Federal aid, universities, and scholarships all have varying deadlines.

NextGenVest’s Solution: Save students time, reduce frustration, and provide on-demand guidance to increase financial aid application completion

Procrastinating large tasks is easier than taking action. We want to change this for students during the financial aid application process by saving them time, hassle, and frustration thereby increasing their likelihood of application submission. We’re doing this in 2 ways:

1. Nudging students with customized and actionable deadline + form reminders over text message.
2. Allowing students to ask questions over text message and get a response in less than 10 minutes.

Nudge Reminders: Customized for students based on graduation year

Students can receive text reminders on:

• Easy ways to get started
• Key financial aid deadlines
• Scholarship opportunities
• Financial aid form explanations

Top student questions that we received in our beta in New York City ranged from:

• “Should I even start this process if I’m not sure my family would qualify?”
• “There are only 10 college fields on the FAFSA, what do I do if I’m applying to more schools?”
• “I work several part time jobs, what do I have to report?”
• “My parents are in the process of getting a divorce, how does this work for my dependent status?”

Why text message?

Ask a parent if their kids ever answer their emails or pick up their phone calls.

“Teenagers don’t necessarily spend a lot of time on a computer when they have a mobile device…reaching them by text is effective; when they hear that ding on their phone, they’ll check it.” — VentureBeat on NextGenVest

Know a student you think we could help? Tell them to sign up for free at www.nextgenvest.com.