Families Are Finessing Their Way Through Financial Aid
By Taylor Durham
- 86.8% of Black students borrow federal loans to attend four-year public institutions
- 46% of all Black students are federal Pell Grant recipients
A second college admissions scandal hit the news recently, involving parents who are disowning their children to secure financial aid. Read that again. Parents are actively giving up their legal rights in order for their children to apply as independents when receiving financial aid. A ProPublica article highlighted an instance at the University of Illinois where families that pursue this route can expect to save about $11,000 a year in combined federal and state grants.
Why This Matters: Financial aid is a necessary evil because, without it, most families wouldn’t be able to pursue the dream of attending a college or university. The perpetrators of this new financial aid scheme are well-to-do families and while technically legal, are hurting less wealthy families. Minority communities have been told that education is the path to freedom, but at what cost?
Black students borrow federal student at rates higher than any other group at 77.7% versus the national average at 60%
One such grant is the Pell Grant, which provides more than $4 billion in assistance to Black college students each year. However, it may not be enough. Black students borrow federal student aid at rates higher than any other group at 77.7% versus the national average at 60%. As such, 1 in 2 Black students defaulted on their loans and others saw their balance grow by 113%. The end result is Black families have high levels of debt which affects their overall income, effectively continuing the cycle of amassing debt for prosperity.
Situational Awareness: It’s distressing enough that Black households are receiving barely any financial support towards higher education, but non-minority households posing as poor to take advantage of the financial aid system compounds the wealth disparity gap. Because of this, Black families who are already financially stressed have to bear the burden of taking out loans, prolonging the economic struggle of seizing generation wealth.
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