What Does Financial Need Look Like for Student Parents?

College can be expensive. In addition to the tuition, fees, textbooks, and supplies required to enroll and succeed in their courses, students need to cover costs outside of the classroom. These include housing, utilities, food, transportation, medical care, and for student parents, child care. All of these necessities have price tags that vary depending on a variety of factors, including a student’s living situation, their major, their location, and their employment situation. Reforms to the federal financial aid process that will more accurately calculate a student’s need and may improve estimation of these costs are on the horizon. While these changes are an important step in the right direction, more must be done to help students, particularly parenting students, pay for college.

Reforms to the financial aid process are on the horizon

The financial aid process can be complicated and confusing. Colleges that receive federal funds are required to estimate expenses for their students to produce a cost of attendance (COA), an academic year budget that includes such categories as tuition and fees, room and board, books and supplies, transportation, and other personal expenses. The COA sets an upper limit on the amount of aid a student can receive.

Students and their families then fill out the Free Application for Federal Student Aid (FAFSA) with information about their household size, income, savings, and assets, and the Department of Education uses that information to determine a student’s Expected Family Contribution (EFC). The EFC is an index number representing a family’s financial strength—students with lower EFCs are typically eligible for more need-based grants and scholarships—and is another key determinant of a student’s financial aid package, which can include resources offered by the federal government, states, and schools.

The implementation of the FAFSA Simplification Act will both simplify the process of applying for federal student aid for many as well as change some elements of how aid decisions are made. Starting with the 2024-25 FAFSA, which will be available for students and families starting in December of 2023, EFC will be replaced with the Student Aid Index (SAI). Unlike with EFC, students will be able to have a negative SAI, reflecting the fact that some students have financial burdens that make it especially hard to meet the costs of college attendance. In addition, the FAFSA Simplification Act will make aid thresholds relating to the Pell Grant more generous for single student parents and dependent students who are the children of single parents. A Brookings Institution analysis suggests changes to Pell Grant eligibility for both student parents and other students will increase Pell Grant receipt by several billion dollars.

The FAFSA Simplification Act also gives the Department of Education the power to regulate how institutions produce COA calculations rather than leaving those decisions at the discretion of the school. Today, colleges calculate COAs differently, and estimates of living expenses can vary, even among schools located in the same city or region. In addition, many institutions underestimate or fail to include common costs like course materials and textbooks in their financial aid offers. As a result, potential future changes to COA estimates could improve understanding of the actual costs students accrue and facilitate access to more aid. Another related change will require institutions to explicitly include the cost of three meals per day in the cost of attendance, regardless of whether students have an on-campus meal plan.

Paying for college will remain a challenge, especially for student parents

While these reforms will provide much-needed additional support for many families, low-resource students, and particularly student parents, will still struggle to access and braid together resources to enroll in and complete college. For example, student parents have expenses—such as the costs of their children’s housing, food, medical care, education, and child care—that may not be considered part of the cost of attending college. Some students may also be supporting other family members. As a result, a school’s COA may not accurately reflect the resources students need for basic economic security while enrolled.

Institutions may only include some of these expenses, such as child care, in a COA at a student’s request, putting a burden on students and student parents to ensure their financial needs are accurately assessed. And even when colleges accurately assess a student parent’s child care costs and include them in a student’s COA, those costs may not be covered by available student aid, especially at schools that have not committed to meeting 100 percent of students’ financial need. Child care arrangements can also change abruptly, even mid-term, leaving parents scrambling to find new arrangements and with financial aid packages that, having been determined at the start of the term, may not reflect resulting increases in the cost of care.

A recent assessment by California Competes found that student parents’ net price is more than $7,500 greater, per child, than the net price of students without children, largely due to child care costs. The Education Trust assessed the typical affordability of public colleges and universities in all 50 states and found that net prices are between two and five times greater for student parents than for other students and that there is no state in which student parents can work 10 hours per week at minimum wage and afford to attend a public college.

These scenarios not only highlight the importance of resources to cover care expenses but also underscore that it is critical for students to be able to access other types of supports, such as aid to cover emergency expenses. Programs covering sudden needs for college students exist on hundreds of college campuses. Some aid may take the form of loans rather than grants, however, and although the American Rescue Plan distributed funds for college student needs arising from the COVID-19 emergency, no permanent, national source of funding for this sort of aid exists.

Many student parents have low incomes and are eligible for broader public benefits programs, which can help them meet their basic needs and the needs of their children. Institutions may use FAFSA data to help inform students about, and in some cases help facilitate access to, public benefits programs. But even when they have information in hand, benefits can be difficult for students to access, especially when programs require that recipients be employed or be seeking work. The requirement to meet and document hours worked at specific types of jobs can make accessing support hard to balance with college enrollment, even among those who already work for pay while attending college.

A comprehensive approach to education must include realistic assessments of financial need, including the fact that life with children is not always predictable at the beginning of a college semester. Building more generous financial aid systems, financial support for child care, and support for emergencies can help ensure that student parents not only access but also complete college.