For cash?strapped students across the country, financial aid can often make or break the ability to go to college. The already thorny issue may become even pricklier if the Senate passes the proposed changes to federal aid in President Barack Obama's 2012 budget plan, which was already approved by the House of Representatives last month.
These changes would target two groups already struggling under the weight of the education price tag: Pell Grant recipients and graduate and professional students.
"Obama's proposals are trying to find the funds for financial aid," Patricia Reilly, the Tufts director of financial aid and co?manager of Student Financial Services, said. "It's sort of thinking about, what are our priorities?"
According to Reilly, increased student need due to the recent recession should make Pell Grants a priority.
"[The federal Pell Grant program] is the basic need?based program for undergrads," she said. "Because the need for the program has gone up in the last couple years, they need to find money to fund the Pell."
The Pell Grant program, which provided a maximum scholarship of $5,500 for the 2010?11 school year, is the largest source of federal aid to some 8 million low?income college students. The budget plan proposes to save $8 billion dollars next year and $60 billion over the next 10 years by eliminating the "year?round Pell," a recent addition to federal aid that allows Pell candidates to receive the grant twice in one calendar year, intended for use toward summer courses.
"It looks like [the summer Pell] will go away as quickly as it arrived," Reilly said. "It's sort of a neat program, in that it allows students to accelerate their degrees. Last summer, it was used at Tufts by about 50 students. There will be students disappointed when we don't have it a year from now."
The second proposal would affect a greater number of students, namely those pursuing graduate and professional studies. If the budget passes, this proposal will reduce subsidies for graduate and professional loans, saving the government $2 billion next year and $29 billion over the next 10 years. It would also profoundly impact the way these loans are repaid.
"That's a really tough decision," Reilly said. "It's one of the issues that's been kicking around in the financial aid community for the last few years: Is it better to subsidize loans while students are in school, or is it better to subsidize loans while students are in repayment?"
Instead of the government paying interest on graduate loans while students are in school, students would enter into a vigorous repayment plan once they graduate, according to Reilly. Known as Income?Based Repayment (IBR), the system allows students to allot a portion of their salary toward what they owe.
"They may borrow a lot but then go into a low?paying job. Instead of subsidizing everyone, let's wait and see who can't afford it when they're in repayment," Reilly said. "They don't put it all on the backs of grad students. There's something in place. I hate to see the cost of borrowing go up while grants go down. I feel that, given the fiscal reality right now, there are some tough choices to be made."
For current graduate students, the proposed changes, while not welcome, are a mere drop in the sea of student debt.
"In my opinion, the extra cost of accumulated interest during deferral periods is very small in relation to the amount of money I've taken on in loans to pay for my education," Timothy Welch, a graduate student studying German, said. "I am able to pay off my loans over a long period of time, so the extra interest may only amount to a few more dollars per month in payments."
According to Reilly, the reality of student loans is hardly immediate.
"The numbers are so unreal when you're enrolled as a student - it doesn't mean much to you until you get to repay," she said.
The mix of grants, loans and scholarships leaves some students feeling as though they are in over their heads.
"I don't think I'm completely aware of what I got myself into," sophomore Brittney Veeck said. "When I was applying to college, my parents said, 'Don't think about where you got scholarships and such, we'll figure out a way to pay for it.' I think my parents didn't want that to affect my decision, but I think that made me unaware. For now, I'm opting to be blissfully unaware."
Veeck's story may ring a chord for many who feel the financial strain of attending the second?most expensive university in Massachusetts, according to the Chronicle of Higher Education; tuition plus room and board for the 2010?2011 school year totaled $52,866. 45 percent of Tufts students currently receive federal aid of some sort, and 12 percent receive a Pell Grant, Reilly said.
"[The proposal] worries me because I feel that the financial aid system isn't that great, and it's them cutting back even more," Veeck said. "I feel it's a little worrisome because it's hard enough for students as it is to graduate, move, start a new career and pay off your loans. It's hard enough as it is to get out of that debt and now it's going to make it even harder."
While the summer Pell Grant may be too new to actually be missed, the reduction in graduate loan subsidies may have a greater effect.
"I have so many loans when I graduate as it is, I don't want to add to it even more," Veeck said. "It's already a tough decision: Do I want to go to grad school, or get a job and then consider going back to grad? I always thought I would get a job right out and this would push me in that direction even more."
Reilly and Welch, however, disagree.
"In my mind, the opportunity to study something I'm passionate about and the opportunity to build a career in that subject vastly outweigh the financial concerns," Welch said.
