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Class of 2022 Missed Out on $3.6B in College Grants, Report Shows
2022 high school graduates left almost $3.6 billion in Pell Grants on the table by not completing the Free Application for Federal Student Aid, a new report found.
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Eliza Haverstock Lead Writer | Student loan repayment, paying for college
Eliza Haverstock is NerdWallet's higher education writer, where she covers all aspects of college affordability and student loans. Previously, she reported on billionaires and investing for Forbes in New York, and she also covered private markets for PitchBook in Seattle. Eliza got started at her college newspaper at the University of Virginia and interned for Bloomberg, where she spent a summer writing a feature story about plastic straws. She is based in Washington, D.C.
Karen Gaudette Brewer Lead Assigning Editor | Core Personal Finance
Karen Gaudette Brewer leads the Core Personal Finance team at NerdWallet. Previously, she guided students and their families through the ins and outs of paying for college and managing student debt on the Higher Education team. Helping people navigate complex money decisions and feel more confident brings her great joy: as the daughter of an immigrant, from an early age she was the translator of financial documents and the person who called the credit card company to fix fraud.
She joined NerdWallet with 20 years of experience working in newsrooms and leading editorial teams, most recently as executive editor of HealthCentral. She launched her journalism career with The Associated Press and later worked for The (Riverside) Press-Enterprise, The Seattle Times, PCC Community Markets and Allrecipes.com.
She is a graduate of the 2022 Poynter Institute Leadership Academy for Women in Media. Her writing has been honored by the Society for Features Journalism and the Society of Professional Journalists. In addition, she’s the author of two books about the Pacific Northwest.
NerdWallet ratingNerdWallet's ratings are determined by our editorial team. The scoring formula for student loan products takes into account more than 50 data points across multiple categories, including repayment options, customer service, lender transparency, loan eligibility and underwriting criteria.
Fixed APR
3.59-17.99%
College Ave Student Loans products are made available through Firstrust Bank, member FDIC, First Citizens Community Bank, member FDIC, or M.Y. Safra Bank, FSB, member FDIC. All loans are subject to individual approval and adherence to underwriting guidelines. Program restrictions, other terms, and conditions apply. (1)All rates include the auto-pay discount. The 0.25% auto-pay interest rate reduction applies as long as a valid bank account is designated for required monthly payments. If a payment is returned, you will lose this benefit. Variable rates may increase after consummation. (2)As certified by your school and less any other financial aid you might receive. Minimum $1,000. (3)This informational repayment example uses typical loan terms for a freshman borrower who selects the Flat Repayment Option with an 8-year repayment term, has a $10,000 loan that is disbursed in one disbursement and a 7.78% fixed Annual Percentage Rate (“APR”): 54 monthly payments of $25 while in school, followed by 96 monthly payments of $176.21 while in the repayment period, for a total amount of payments of $18,266.38. Loans will never have a full principal and interest monthly payment of less than $50. Your actual rates and repayment terms may vary. Information advertised valid as of 11/1/2024. Variable interest rates may increase after consummation. Approved interest rate will depend on creditworthiness of the applicant(s), lowest advertised rates only available to the most creditworthy applicants and require selection of the Flat Repayment Option with the shortest available loan term.
Variable APR
5.34-17.99%
College Ave Student Loans products are made available through Firstrust Bank, member FDIC, First Citizens Community Bank, member FDIC, or M.Y. Safra Bank, FSB, member FDIC. All loans are subject to individual approval and adherence to underwriting guidelines. Program restrictions, other terms, and conditions apply. (1)All rates include the auto-pay discount. The 0.25% auto-pay interest rate reduction applies as long as a valid bank account is designated for required monthly payments. If a payment is returned, you will lose this benefit. Variable rates may increase after consummation. (2)As certified by your school and less any other financial aid you might receive. Minimum $1,000. (3)This informational repayment example uses typical loan terms for a freshman borrower who selects the Flat Repayment Option with an 8-year repayment term, has a $10,000 loan that is disbursed in one disbursement and a 7.78% fixed Annual Percentage Rate (“APR”): 54 monthly payments of $25 while in school, followed by 96 monthly payments of $176.21 while in the repayment period, for a total amount of payments of $18,266.38. Loans will never have a full principal and interest monthly payment of less than $50. Your actual rates and repayment terms may vary. Information advertised valid as of 11/1/2024. Variable interest rates may increase after consummation. Approved interest rate will depend on creditworthiness of the applicant(s), lowest advertised rates only available to the most creditworthy applicants and require selection of the Flat Repayment Option with the shortest available loan term.
NerdWallet ratingNerdWallet's ratings are determined by our editorial team. The scoring formula for student loan products takes into account more than 50 data points across multiple categories, including repayment options, customer service, lender transparency, loan eligibility and underwriting criteria.
Fixed APR
3.49-15.49%
Lowest rates shown include the auto debit. Advertised APRs for undergraduate students assume a $10,000 loan to a student who attends school for 4 years and has no prior Sallie Mae-serviced loans. Interest rates for variable rate loans may increase or decrease over the life of the loan based on changes to the 30-day Average Secured Overnight Financing Rate (SOFR) rounded up to the nearest one-eighth of one percent. Advertised variable rates are the starting range of rates and may vary outside of that range over the life of the loan. Interest is charged starting when funds are sent to the school. With the Fixed and Deferred Repayment Options, the interest rate is higher than with the Interest Repayment Option and Unpaid Interest is added to the loan’s Current Principal at the end of the grace/separation period. To receive a 0.25 percentage point interest rate discount, the borrower or cosigner must enroll in auto debit through Sallie Mae. The discount applies only during active repayment for as long as the Current Amount Due or Designated Amount is successfully withdrawn from the authorized bank account each month. It may be suspended during forbearance or deferment. Advertised APRs are valid as of 10/25/2024. Loan amounts: For applications submitted directly to Sallie Mae, loan amount cannot exceed the cost of attendance less financial aid received, as certified by the school. Applications submitted to Sallie Mae through a partner website will be subject to a lower maximum loan request amount. Miscellaneous personal expenses (such as a laptop) may be included in the cost of attendance for students enrolled at least half-time. Examples of typical costs for a $10,000 Smart Option Student Loan with the most common fixed rate, fixed repayment option, 6-month separation period, and two disbursements: For a borrower with no prior loans and a 4-year in-school period, it works out to a 10.28% fixed APR, 51 payments of $25.00, 119 payments of $182.67 and one payment of $121.71, for a Total Loan Cost of $23,134.44. For a borrower with $20,000 in prior loans and a 2-year in-school period, it works out to a 10.78% fixed APR, 27 payments of $25.00, 179 payments of $132.53 and one payment of $40.35 for a total loan cost of $24,438.22. Loans that are subject to a $50 minimum principal and interest payment amount may receive a loan term that is less than 10 years. A variable APR may increase over the life of the loan. A fixed APR will not.
Variable APR
5.04-15.21%
Lowest rates shown include the auto debit. Advertised APRs for undergraduate students assume a $10,000 loan to a student who attends school for 4 years and has no prior Sallie Mae-serviced loans. Interest rates for variable rate loans may increase or decrease over the life of the loan based on changes to the 30-day Average Secured Overnight Financing Rate (SOFR) rounded up to the nearest one-eighth of one percent. Advertised variable rates are the starting range of rates and may vary outside of that range over the life of the loan. Interest is charged starting when funds are sent to the school. With the Fixed and Deferred Repayment Options, the interest rate is higher than with the Interest Repayment Option and Unpaid Interest is added to the loan’s Current Principal at the end of the grace/separation period. To receive a 0.25 percentage point interest rate discount, the borrower or cosigner must enroll in auto debit through Sallie Mae. The discount applies only during active repayment for as long as the Current Amount Due or Designated Amount is successfully withdrawn from the authorized bank account each month. It may be suspended during forbearance or deferment. Advertised APRs are valid as of 10/25/2024. Loan amounts: For applications submitted directly to Sallie Mae, loan amount cannot exceed the cost of attendance less financial aid received, as certified by the school. Applications submitted to Sallie Mae through a partner website will be subject to a lower maximum loan request amount. Miscellaneous personal expenses (such as a laptop) may be included in the cost of attendance for students enrolled at least half-time. Examples of typical costs for a $10,000 Smart Option Student Loan with the most common fixed rate, fixed repayment option, 6-month separation period, and two disbursements: For a borrower with no prior loans and a 4-year in-school period, it works out to a 10.28% fixed APR, 51 payments of $25.00, 119 payments of $182.67 and one payment of $121.71, for a Total Loan Cost of $23,134.44. For a borrower with $20,000 in prior loans and a 2-year in-school period, it works out to a 10.78% fixed APR, 27 payments of $25.00, 179 payments of $132.53 and one payment of $40.35 for a total loan cost of $24,438.22. Loans that are subject to a $50 minimum principal and interest payment amount may receive a loan term that is less than 10 years. A variable APR may increase over the life of the loan. A fixed APR will not.
Credible lets you check with multiple student loan lenders to get rates with no impact to your credit score. Visit their website to take the next steps.
High school graduates left billions of dollars in free college aid on the table by not filling out the Free Application for Federal Student Aid, or FAFSA, in 2022. Among the class of 2022, 44% of high school graduates skipped the FAFSA — and eligible students left behind $3.58 billion worth of Pell Grant money — per a January analysis by the National College Attainment Network, or NCAN.
The need-based Pell Grant is the largest federal grant program offered to U.S. undergraduates, and 2022 high school graduates who qualified for it received an average award of $4,686, the NCAN report found. A Pell Grant does not need to be repaid; it’s free money.
There are a few caveats to the report, however. FAFSA noncompletion percentages are based on the entire high school class of 2022, thus assuming that all of these students would want to go directly to college. Plus, not everyone can fill out the FAFSA. Undocumented students, for example, are not eligible for federal college aid, including Pell Grants, and are typically blocked from the FAFSA.
The class of 2022’s relatively high 44% national FAFSA noncompletion rate nonetheless marks an improvement from 2021 — the report’s debut — when 46% of students skipped the application, forgoing roughly $3.75 billion in Pell Grants.
The findings underline the work still to be done to encourage demand for higher education, says Bill DeBaun, NCAN’s senior director of data and strategic initiatives.
“The overarching message here is that there is slack in the postsecondary pipeline,” says DeBaun. “We are not connecting all the students that we can with available financial aid.”
Filling out the FAFSA is the key to unlocking federal, state and school-based loans and aid — including Pell Grants, work-study options and even some private scholarships. You should complete the FAFSA if you’re considering attaining a higher education, regardless of whether you’re currently enrolled or accepted to any schools. The application applies to most types of universities, including community colleges.
Rebound of the college-bound
The slight drop in FAFSA noncompletion percentages fits into a larger narrative of college applications and attendance rebounding after a pandemic slump.
College freshman enrollment is improving steadily, though it remains below 2019 levels. In the fall of 2022, freshman enrollment was up 4.3% from the fall of 2021, an increase of almost 100,000 students, according to recent data from the National Student Clearinghouse Research Center.
Admissions applications indicate that number is poised to grow in the year ahead. Through Jan. 1, 2023, nearly 1.1 million students applied to college for the first time — a 20% increase from the 2019-2020 application cycle, according to Common App, a nonprofit membership organization of universities that facilitates admissions applications. Of those students, underrepresented minority applicants increased by 30% and first-generation applicants increased by 35%.
The percentage of high school graduates who didn’t complete the FAFSA varied widely from state to state.
Alaska, Utah and Oklahoma demonstrated the highest 2022 noncompletion rates, at 65%, 62% and 57%, respectively. On the other hand, Washington, D.C. (26%), Tennessee (29%) and Louisiana (31%) had the lowest noncompletion rates.
State policy decisions could help explain the discrepancies, says DeBaun. For example, Louisiana became the first state to make FAFSA completion a high school graduation requirement, starting in the 2017-2018 academic year — although students have some ways around it, like getting a parent to sign a waiver. Tennessee promises free community or technical college to all of its high school graduates, but eligibility hinges upon completing the FAFSA.
Aid deadlines vary
The FAFSA nonparticipation rates featured in NCAN’s analysis could change in the coming months, because the high school class of 2022 still has time to complete the FAFSA.
The 2022-2023 application will remain open until June 30, 2023. And students enrolled in college can still receive federal aid for the entire current academic year, including Pell Grants and direct loans, says Jill Desjean, a senior policy analyst at the National Association of Student Financial Aid Administrators.
However, states and universities typically have their own, earlier FAFSA deadlines for students to qualify for other types of aid. Many of those deadlines have passed for 2022 high school graduates who enrolled in college this past fall.
Fill out the FAFSA as soon as possible after it opens ahead of the academic year during which you plan to start college. The FAFSA for the 2023-2024 school year opened on Oct. 1, 2022.
“The earlier you file, the better, but students who miss a deadline shouldn’t just give up,” advises Desjean. “Especially with schools, where [students] might be able to request an exception to the deadline if they have a valid reason for missing it.”
