Using a Latino Lens to Reimagine Financial Aid

Financial aid has not kept pace to serve today’s students. Historically, the majority of financial aid recipients had a similar profile. Today, financial aid recipients are significantly more diverse. The profile of today’s college students continues to evolve, and at Excelencia in Education, we are focused on a significant part of this evolving student profile—Latinos. For example, Latinos’ college enrollment rate after high school has increased 20 percentage points since 2000 to 67 percent. And we are the largest growth population overall in the country. 

Consider some facts about Latino college students. Excelencia’s analysis of federal data showed Latinos receive an average financial aid award of $12,260—the lowest of all racial/ethnic groups. And yet, Latinos’ average family income is significantly lower than others ($58,920 vs. $88,270 for all) and have an average expected family contribution of about $6,000, compared to $10,000 for all students. And less than a third (29%) of Latino students accept federal loans. 

Latinos are less likely to receive federal aid, borrow, and are more likely to come from low-income families than other students. How are Latinos affording college? We are adapting our choices and pathways around financial aid since it does not serve our current needs. For example, Latinos are more likely to attend a two-year public institution (41%), attend part-time or mix part- and full-time (60%), and more than half (51%) work over 30 hours a week. Latinos are progressing through college, albeit slowly, and about a fifth of Latinos (19%) are still enrolled six years after beginning their education. Latinos are adapting to the system to make college affordable for them, but what if it worked the other way around? What if financial aid adapted to the needs of today’s students? Such a framework should guide how we think about financial aid. 

Excelencia’s analysis sees high participation among Latinos in the Federal Pell Grant program—about half of Latino students (47%) receive a Pell Grant, and they receive a larger average award ($3,855) than most other racial/ethnic groups. One reason for this may be that the Pell Grant is distributed regardless if a student is attending full- or part-time. Making financial aid eligibility independent of enrollment intensity is one way to help students. 

Another source of grant funding that should be reimagined with a Latino lens is campus-based aid, including Federal Work Study. Only 2 percent of Latino students currently receive any sort of campus-based aid, shutting out thousands of potential beneficiaries. Revisiting the distribution formula so it better reflects the needs of today’s students can help. Additionally, Federal Work-Study capitalizes on Latinos’ high work participation, but allows them to work on-campus and better access on-campus resources.

Policymakers need to reimagine federal financial aid to benefit all of today’s students—including Latinos. Too many of today’s students are like Latinos—they are adapting their choices and pathways around financial aid because it does not serve their current needs. Reimagining financial aid means more than distributing more grants. At Excelencia, we’ve identified programs serving Latino students—and all students—in our Growing What Works database. For example, providing mentors, tutors, peer cohorts, and helping students feel connected to their campus can all help as they navigate the many systems in higher education and complement the financial support. 

Financial aid is critical to today’s students’ success. Latinos are indicative of today’s students’ needs. Policies, programs, and institutional efforts that adapt to better serve Latino students are more likely to serve all of their students better. In the same vein, federal financial aid policy that applies a Latino lens can serve today’s students better.