According to a recent survey by NextGenVest.com, 68% of prospective students say "they literally know nothing" about their student loans or about their refinancing options post-graduation.
Kelly Peeler, founder and CEO of NextGenVest, recently wrote about the survey and her team's findings in Forbes.
To conduct the survey, researchers asked questions about financial aid to 225 high school seniors who were deciding between college financial aid packages and acceptance offers.
One of the reasons financial literacy was so low is that students haven't had adequate guidance at the high school level, Peeler argues. In fact, of the students surveyed, only 31% reported having had any guidance about college financing during high school.
Peeler shares that this figure was not surprising, since the average college counselor-to-student ratio is 1:476.
Around 45% of the students surveyed say that navigating financial aid paperwork is even more stressful than standardized tests. Aspects of the financial aid process that make it so stressful include:
- Compiling tax forms;
- Remembering passwords;
- Answering over 400 questions; and
- Offering up personal information.
"One of the main hurdles with completing the FAFSA is just the number of steps that students have to go through and the different moving pieces that are required from parents and students," says Margaret Feldman, the director of college advising with the Scholarship Fund of Alexandria. Feldman says that even with the new early FAFSA, there are still many steps involved that slow down students.
These steps can end up deterring students from applying for loans and aid altogether—in fact, $2.7 billion of free federal aid goes unclaimed each year, according to Peeler (Peeler, Forbes, 2/15).
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