Optimize Financial Aid to Shape Your Independent School’s Student Body

Most independent schools view financial aid as a mechanism for making their institution affordable to as much of the applicant pool as is needed to fill the seats in each class. But pricing and aid strategy should be optimized to balance toward two specific ends:

Through our research we have found that most independent schools do not fully utilize financial aid as a lever to help shape their classes. Our purpose in creating this resource is to show schools how to employ aid as a tool—not view it as expense—to enroll the racially and socio-economically diverse classes they seek in an effort to produce the well-rounded leaders of tomorrow.

The six steps of optimizing financial aid

To take advantage of the COVID “moment” when many public-school families are considering independent schools for the first time, school leaders must approach their financial aid policy with a clear strategy to enroll more diverse and middle-income families.

Properly conducting financial aid optimization requires to independent schools to prepare, analyze, and act on your enrollment data. This includes six key components:

1. Set enrollment goals: Your institution must be clear about enrollment goals. These goals must be specific, guide trade-offs as the school sets aid policy, and have clear timelines.
2. Adopt a strategic mentality: Think of how financial aid can help your institution to achieve its enrollment goals, rather than considering it to be strictly a means to help with affordability.
3. Understand yield patterns in relation to aid awards: Review historical financial aid data and yield rates to better understand how financial aid is impacting your yield for subsets of students.
4. Identify misalignment: Review historical financial aid data and yield rates to to assess where you are not yielding the students you expect.
5. Make data-driven hypotheses: Use data to hypothesize what would get desired students and families to say “yes” to attending your institution.
6. Continue to track enrollment outcomes: Test out hypotheses and adjust as needed to meet enrollment goals.

A deep dive into financial aid data

To serve the needs of our partners, the Independent School Executive Forum worked with EAB’s higher education Financial Aid Optimization team to develop a tool for independent school partners to analyze historical financial aid data. Enrollment and financial aid leaders can use this tool at their institutions to better understand whether their use of financial aid is advancing their enrollment goals.

Enrollment management teams simply copy data from SSS reports into the tool to populate a series of tables that can be used to answer key questions about enrollment trends. We highly recommend that independent schools utilize this resource to examine their historical financial aid data and challenge or confirm assumptions about how their current financial aid policy yields their desired study body.

Watch the video below for an explanation on how to use the Financial Aid Optimization Tool.