What is old is new.

In 2002 the then attorney general Spitzer worked to get a court order to bar a Lynbrook company from using a “fake” marketing scheme where the company sent schools a survey to complete by children to collect personal information and then used/sold that information to target sales pitches to children for items such as magazines, music videos, credit cards, clothes, cosmetics and student loans.

What is old is new.

We are now getting inundated with solicitations to place a “scholarship(s)” online or to notify our students about scholarships that our students cannot afford to not know about.  These are a scheme to collect personal information to market and sell that data. Often the entity will give away the $1,000 at random to stay legit.  The survey for a potential scholarship is used to collect extensive data and is then resold. The $1,000 is small change for the profits the marketing firm makes. They often present themselves as any number of names or companies.

When we as financial aid professionals, in our urge to assist our students, place these phony scholarships on our web sites or notify our students, we unwittingly help the marketing firms gather data and resell this data at extensive profits. The fake scholarship gimmick has become big business. At my school we must get at least 3-5 e-mails a week from various so called scholarships. If you try to locate information online about these awards you never find them.

What is old is new.

Maybe it is time for the current Attorney General to start looking into these marketing firms posing as scholarships? You would think our job would get easier?

New Life Delayed study shows perception is reality for struggling student loan borrowers

By John Zurick; SALT, American Student Assistance

American Student Assistance® recently released an update to our Life Delayed study. The results were largely consistent with and extended our original survey’s message: Student loan debt is having a profound impact on the daily lives and spending habits of young Americans long after they leave school, regardless of the type of institution they attended or the level of credential earned, and preventing many from participating
fully in our economy.

Highlights of the study show 62% of respondents said their student debt posed a hardship on their personal budget when combined with all other household spending. Specifically, 35% of respondents said they found it difficult to buy daily necessities because of their student loans; 52% said their debt affected their ability to make larger purchases such as a car; 62% said they have put off saving for retirement or other investments; and 55% indicated that student loan debt affected their decision or ability to purchase a home. While recent other reports have pointed to student debt as being a crisis for only certain portions of the student population, large swaths of Life Delayed respondents from all institution types reported having difficulty with their debt. Community college students faced the biggest challenge, with 49% saying it is difficult or very difficult to make student loan payments, while 48% of private institution borrowers and 40% of public school borrowers said they faced similar challenges. Forty-three percent of graduate school borrowers said they find it difficult to pay student loans each month.

These results made me think about the difference between perception and reality. In the ongoing debate as to whether or not a student debt crisis exists, many researchers rightfully point to data that shows only small amount of students default, primarily confined to students who drop out before completion and/or attend certain types of institutions. That may be so, but a) default is only the tip of the iceberg – there are many more who get behind on payment and damage their credit, without ever defaulting; and b) even more importantly, many more borrowers perceive they’re struggling with their student loans or feel the debt is a burden. Their perception of the debt, and how it impacts their other financial decisions, is their reality and is just as important as the reality of whether or not they’re making their student loan payments on time.

We cannot make the assumption that just because loan payments are being made, the debt is not a burden. In reality, many borrowers are making huge sacrifices to both pay down their education debt and stay financially afloat. If a borrower pays his student loan religiously every month, but feels he has to forego buying a home, a car, saving for retirement, or putting away college savings for his own children, can we really say there’s no problem?  He may be successfully managing the education debt, but it’s at the expense of his entire financial well-being. And, in a consumer economy, his financial well-being impacts all of us, when he doesn’t start a household and purchase the necessary consumer goods that keep our economy running now and in the future.

The crisis naysayers fear that admitting there’s a crisis will make policymakers jump to drastic measures, like restricting borrowing to the most creditworthy or focusing
solutions on high-debt borrowers, when it’s the dropouts with $5K in student loans who really need the help. My fear, though, is that if we continue to sweep the crisis under the rug and whistle past the graveyard, nothing-to-see-here style, then we’ll never confront the bigger policy issues around making higher education affordable. As I’ve written in the past,
higher education is a public good and as a society we should commit to shouldering some of the financial burden so it’s affordable and accessible to all who are academically qualified. If we don’t put a stake in the ground now and unequivocally aspire to free (or debt-free) public K-14 education as the new norm, then when will we?

Helping Students Explore Scholarship Opportunities

“Helping Students Explore Scholarship Opportunities”

By Shaun Hoff

Associate Director, SUNY New Paltz Financial Aid Office

As the costs for attending college continue to rise, it is more important than ever for students to apply for scholarships. A scholarship award can positively impact the lives of students and recognize the academic accomplishments of a student scholar. Scholarships can allow students to attain an education that may otherwise not be affordable due to financial constraints, as well as result in reduced loan borrowing by students and their parents to pay for college. A scholarship award can alleviate a student’s financial worries, and allow students to focus more on their studies and academics.

To help families prepare for the process of applying for private and institutional scholarships, the SUNY New Paltz Office of Financial Aid developed an “Exploring Scholarship Opportunities” presentation. This presentation has been available to explain the definition of a scholarship, the benefits of scholarship awards, the types of scholarships that are available for students, and the various ways students can successfully navigate to find scholarship opportunities since it can be a very challenging endeavor.

The presentation provides helpful information about why students should be awarded a scholarship, and explains how students need to be prepared to do writing, such as cover letters and thank you letters. It also provides useful websites for scholarship searches, as well as a list of common mistakes on scholarship applications. Some common mistakes include submitting an incomplete scholarship application without all of the necessary requirements, forgetting to sign the application, having spelling errors, and not taking the opportunity for someone to read their application before submitting the final version.

In addition, tips for writing an autobiographical and personal scholarship essay are provided so students have a better chance to be awarded a scholarship by a committee. For instance, applicants should consider beginning their essays with a familiar saying that guides them or by utilizing a quotation that is particularly meaningful to them. Applicants can also start with an outline and then begin to write paragraphs about each particular point. Another tip is for applicants to write about their dreams, goals, achievements, and activities at home or school.

The presentation includes valuable scholarship search tips, information about scholarship deadlines, and seven common signs a private scholarship is a scam. For instance, applicants should always be cautious and never give out their social security numbers, credit card numbers, or bank information. Lastly, ten tips for scholarship success and the expectations for being a scholarship recipient are outlined.

For details about this presentation and the SUNY New Paltz Office of Financial Aid, please visit http://www.newpaltz.edu/financialaid/.

New Minimum Wage Discussion

I think there are still so many unanswered questions on this topic. Certainly some of the implementation questions will be answered. But reading through what has been provided: are campuses meeting to discuss the ramifications? How will the campuses handle the situations where your student employees (work study and others) make more than your CSEA employees? How will this impact the cost of services like meal plans for the students? I think many students and families value work study as a part of their financial aid package. How will this affect enrollment if we fund fewer work study positions?

Kathy Flaherty

NYSFAAA Secretary

Announcement of Governor’s Minimum Wage Increase for SUNY

I would like to invite discussion on this. Thank you Jim Gathard for raising the questions that you have raised for the SUNY announcement on the wage increases. The Bursars and Financial Aid Directors received an email from SUNY that answers some of the questions that you raised. Below is the email we received.

“While the particulars of SUNY’s approach to this change will be presented to the SUNY Board of Trustees at next week’s meeting, I thought it important to share the foundations from which decisions will be made:

– General:
o Incremental direct State tax support will being requested to cover costs estimated to be caused by 2015/16 and 2016/17 rate increases, as well as future increases,
o Increases would only impact hourly employees that are not represented by a collectively bargained unit,
o Increases to the minimum wage will have to be approved by the Board of Trustees,
o The impact on student financial aid packages will have to be taken into consideration when offering hourly wages to students.
– State-operated Campus Specific:
o Specific technical information will be provided following Board of Trustees review and approval.
– Community Colleges and Statutory Colleges:
o Actions related to minimum wage increases at the community colleges or the statutory colleges will need to be approved by the individual local Board of Trustees, or of the Boards of Trustees of the respective statutory college.

Thank you, and we will follow-up with further information following the upcoming meeting of the SUNY Board of Trustees”.

That said, of course there will be impacts to students awards and hours worked. In the 23 years I have been at SUNY Canton we have had the exact same CWS allocation. Through many wage increases we have tried to balance raising awards and awarding fewer students to best provide for our student population. We do not expect any increases to federal allocations and as mentioned in SUNY’s email there will be requests for additional state matching funds.

Wage increases have always been difficult to manage and will continue to be that way, especially since the jump will be much larger over the next few years. We expect more information from SUNY as it develops.

What do you all think? What do you forsee as an impact for your institutions, whether SUNY or private?

Kerrie Cooper
NYSFAAA President