Paying for Itself: How Financial Aid is a Smart Investment in Our Nation's Future   [open pdf - 0B]

From the Document: "On its face, investment in financial aid is an expensive policy, with close to $30 billion in federal Pell Grant expenditures allocated in 2019 alone and significantly more coming from state and local governments and philanthropies. From the student perspective, financial aid is one of the most successful policies for increasing college attendance and completion rates. Yet only recently has research begun to evaluate financial aid from a government perspective, finding that aid is also a successful investment that produces positive returns through higher employment rates and tax revenues--even if these returns might not be visible until far into the future. Given the crushing budget challenges that lie ahead for both states and the federal government, it would be easy for policymakers to consider cutting funding for financial aid programs. But that short-term decision would be counterproductive and come at the expense of society's long-term goals. A better approach is for the government to turn an eye to improving these programs' cost-effectiveness, targeting aid toward those who are most likely to benefit, and increasing the transparency and accessibility of aid programs in order to encourage applications among those traditionally less likely to attend college."

Third Way
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