Decades of technological and economic change have dramatically increased the importance of postsecondary education for economic mobility and labor market success. Still, substantial disparities in four-year college enrollment, persistence, and graduation rates remain for students from disadvantaged backgrounds. In response to these challenges, colleges and universities across the country are experimenting with financial aid programs in hopes of increasing accessibility and improving student outcomes. In the fall of 2015, the Camden campus of Rutgers, the State University of New Jersey (Rutgers–Camden), announced plans to implement a last-dollar financial aid program called Bridging the Gap that would eliminate or substantially reduce the cost of tuition and certain fees for in-state students from lower- and middle-income families. The Federal Reserve Bank of Philadelphia is engaged in a multiyear, mixed-methods evaluation of Bridging the Gap to assess its impacts on student success and financial wellbeing.
The second report in this series provides a mixed-methods look at the inaugural Bridging the Gap cohort’s first full year of college, complementing analysis of enrollment and academic performance data with insights from student interviews. Early results suggest positive impacts on enrollment among lower-income students, although it is unclear whether observed improvements in academic performance are attributable to the program. Interviews with participants suggest the program improved affordability and reduced financial stress but illuminate challenges with the financial aid process and maintaining eligibility.
Full Report: "How Does Last-Dollar Financial Aid Affect First-Year Student Outcomes? Evidence from the Bridging the Gap Study" (28 pages, 9.3 MB)
The first report in this series presents findings from interviews conducted with Rutgers–Camden administrators and students who participated in the first cohort of Bridging the Gap, exploring the impact of the program on students’ college application process, transition to college, and financial wellbeing. Qualitative analysis of these interviews provides early evidence that the program has been successful at expanding financially disadvantaged students’ access to a traditional four-year degree program. However, challenges identified in the interviews, including the difficulty of managing ongoing living and educational expenses beyond tuition, emerged as potential obstacles for students’ persistence in college. Additionally, many students struggle to navigate and make sense of program requirements and bureaucratic processes, particularly with respect to financial aid.
Full Report: "Navigating the First Semester: How Students Get to and Get by in College" (20 pages, 984 KB)
College Promise Programs and Lower-Income Students: Design, Implementation, and Impact
May 29, 2019
Experts discuss the current landscape of college promise programs, research on their effectiveness in promoting college access and student success, the program designs that are most successful, and the partnerships necessary to keep these program sustainable in the long term. Phoebe Haddon, chancellor of Rutgers University–Camden, provides opening remarks, and Martha Kanter, executive director of the College Promise Campaign, delivers the lunch keynote.
This report outlines the recent history of student loan borrowing in the Third Federal Reserve District and explores lending patterns, by the neighborhood income of the borrower, to better understand the implications for low- and moderate-income communities.
This interactive tool enables users to look at quarterly changes in credit use indicators, including student loan debt use and delinquency, and to compare indicators across different areas.
This paper examines whether student loan borrowers changed their bankruptcy filing behavior in response to policy changes that restrict the dischargeability of student loan debt.
This paper examines how restrictions on for-profit colleges’ access to federal financial aid programs affect enrollment patterns and student loan outcomes.
This study examines the impact of the growth in student debt on small business formation, finding a negative correlation between changes in student loan debt and net business formation for establishments with four or fewer employees.
This report discusses policy considerations for regulating the disbursement of federal financial aid, balancing the goals of student protection and efficient use of public funds with expanding access to postsecondary education for disadvantaged groups.
This paper examines whether student loan repayment insurance, in the form of loan forgiveness in the event of failure to complete college, affects student welfare and enrollment and graduation rates.
This paper reports the results of an experiment in which college students are provided important information about their borrowing options, finding that information alone does not substantially affect students’ borrowing behavior.