It should be more difficult to get financial aid in 2011-12, according to an article from yesterday’s US News & World Report. Colleges have seen their asset portfolios decline in recent years, putting the pinch on financial aid and other university budgets. And the Obama Administration has eliminated the Academic Competitiveness Grant (ACG), a small but helpful grant awarded to first and second year students who are high achievers.
These are uneasy, strange times. In last week’s State of the Union Address, President Obama stressed the importance of higher education, explaining that 50% of all new jobs will require a college degree. Yet because of our rising national deficit and debt, the administration is moving to eliminate the ACG in order to save about $860 million.
The good news is that the Pell Grant will remain unchanged, at $5,550 for families in the greatest need. The bad news is that the Pell Grant will remain unchanged, at $5,550 and won’t be increasing. Who knows what next year will bring, but don’t be surprised if they slash the Pell Grant somehow, or make eligibility more difficult.
More “good” news: Interest rates on subsidized student loans will decline from 4.5% today to 3.4% next year. This is great for students who incur debt, but the better approach would be to avoid debt entirely.
A college degree is more important than ever. And paying for it is more difficult than ever. That’s why you should attend one of my FREE workshops on the subject.