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Session 47
Research & Recommendations
to Help Students Succeed
Ed Pacchetti | Dec. 2015
U.S. Department of Education
2015 FSA Training Conference for Financial Aid Professionals
Agenda
1.
Introductions
2.
Federal Student Aid
Behavioral Science Insights and Borrower Outreach
3.
Lumina Foundation
Form and Formula: How the Federal Government Distributes Aid to Students
4.
Ideas 42
Breaking Behavioral Barriers in the Financial Aid System
2
Adopting the insights of behavioral science will help bring
our government into the 21st century in a wide range of
ways - from delivering services more efficiently and
effectively; to accelerating the transition to a clean energy
economy; to helping workers find better jobs, gain access to
educational opportunity, and lead longer, healthier lives.“
— President Barack Obama, September 15, 2015
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The Student Aid Bill of Rights
Finding New and Better Ways to Communicate with
Student Loan Borrowers. By January 1, 2017, the
Secretary shall also, in consultation with the Director
of the White House Office of Science and Technology
Policy, develop and implement at least five
behaviorally designed pilot programs to identify the
most effective ways to communicate with borrowers
to maximize successful borrower repayment and help
reduce delinquency and default and report to the
President, through the Director of the Domestic
Policy Council, on the status and results of those pilot
programs.
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Federal Student Aid Borrower E-mail Campaigns
Over 2 million borrowers were sent e-mails in Fiscal Year
2015 through four behaviorally informed pilots:
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1.
Borrowers that missed a payment
2.
Borrowers in default
3.
Borrowers at risk of withdrawing from school
4.
Borrowers in income-driven repayment that needed to complete their annual
recertification
Federal Student Aid
Federal Student Aid makes use of data and research such as:
• Customer segmentation
• FAFSA completion data
• Customer surveys of students and borrowers
• A/B message testing
• Experimental sites
• Best practices
• Behavioral insights, for example…
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Behavioral Insights and Borrower E-mails
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Social and Behavioral Sciences Team
Results from Borrower E-mail Campaigns
To help Federal student-loan borrowers stay on top of their payments,
SBST and FSA sent a reminder e-mail to over 100,000 borrowers who
had missed their first payments. Reminder e-mails to Federal studentloan borrowers who missed their first payment led to a 29 percent
increase in the number of borrowers making a payment.
To increase awareness of income-driven repayment plans among
student loan borrowers, SBST and FSA sent an informational e-mail
about IDR plans to over 800,000 borrowers who had fallen behind on
their payments. The message led to a fourfold increase in applications
for IDR plans.
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http://youtu.be/Xd_KIvNjLAs
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Josh Martin, Senior Associate
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Are systems designed to help or hinder?
12
What you were may have been doing last night
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Why does the house always win?
“Gambler’s”
or
“hot hand”
fallacy
14
• “I’m due for a win”
• “It has to even out soon”
• “Ride the hot hand, baby!”
Weird things we all other people do
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What does the science say?
16
You have one job…
Say out loud the color
of the shape you see
on the screen.
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18
19
20
21
22
23
24
25
BLUE
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When might students need to think carefully?
FAFSA
completion
Course
registration
Choosing among
aid options
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Standard Model of Decisions and Actions
Decision
I want X
So, what should I do?
Outcome
I get X
Yes
A
Yes
No
B
No
Don’t
know
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Action
BEHAVIORAL Model of Decisions and Actions
Decision
I want X
Action
So, what should I do?
Is it easy?
Outcome
I get X
Am I in the right mood?
Yes
A
Yes
No
B
No
Don’t
know
Will it take a
long time?
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Can I put it off?
BEHAVIORAL Model of Decisions and Actions
Problem: Students are not applying for financial aid (even though they’re eligible to)
Traditional perspective:
– They lack information
– They don’t want/need aid
– Not enough aid is
available
Behavioral perspective:
– The form is a hassle to fill
out
– It contains things that
make students question
whether they’re “right”
for college
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The ideas42 Methodology
REDEFINE
PROBLEM
FIND ANOTHER
BOTTLENECK
DEFINE
DIAGNOSE
DEFINED
PROBLEM
STATED
PROBLEM
CAPACITY AND
SCALABILITY
ideas42
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partner
ACTIONABLE
BOTTLENECKS
BEHAVIORAL
MAP
DISENTANGLE
PRESUMPTIONS
DESIGN
CONTEXT
RECONNAISSANCE
consumer
sequential
SCALABLE
INTERVENTION
INTERVENTION
CONCEPT
HYPOTHESIZED
BOTTLENECKS
TEST
POLISH
INTERVENTION
DETERMINE
FEASIBILITY
iterative
as necessary
CLARIFY
OUTCOMES
ROBUST
EXPERIMENT
IDENTIFY
SIDE EFFECTS
Project 1
Increasing FAFSA Applications with Behavioral Design
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Problem: Only 18% of students file by the priority deadline; some never do
•
Priority filers are guaranteed maximum aid package
•
Nationally, priority filers are offered 2x as much aid as those
who apply later
•
Nationally, at least 2 million students did not receive grants
they qualify for because they did not file the FAFSA1
1. In 2011-13 http://money.cnn.com/2014/03/07/pf/college/fafsa-financial-aid/
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Behavioral Barriers to Filing
1
2
3
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Students do not understand what
information they need to file the FAFSA
Students do not adequately plan to
collect the information they’ll need (once
they know)
Parent information is difficult to obtain
and may require significant effort by both
student and parent
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5
6
Priority deadline not salient at the right
time
Inaccurate mental model of who
receives financial aid
Misperceived social norms of how many
students submit the FAFSA
before priority deadline
Solution: Behavioral communications to students
and parents before deadline
Solution 1: student action
•
•
•
Population: 63,000 continuing students
Treatment group: 8 behavioral e-mails sent to students
– 3 sub-treatments compared BE e-mail, short BE email, and peer BE e-mail
Control group: 1 standard ASU e-mail sent to students*
*Note this is standard protocol for ASU
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Solution 2: parent action
•
•
•
Population: 22,000 continuing students with parent emails on file
Treatment group: 2 behavioral e-mails sent to parents
Control group: no communications*
Solution 1: Facilitating student action
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Solution 2: Facilitating parent action
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We increased priority FAFSA filers by as much as 72%
+72%
+52%
+38%
**
**indicates significance at the 95% level
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**
**
We increased total FAFSA filings by up to 9%
+9%
**
**Indicates significance at the 95% level
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**
**
Project 2
Choosing courses to stay eligible for financial aid
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Problem: Choosing Courses at Valencia College
We observe:
Valencia students register for courses that
are not relevant to their major,
jeopardizing their federal aid
We want:
Valencia students to register for more
relevant courses, maximizing their aid
eligibility
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What Leads Students Off Track?
Before registering…
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After registering…
Solution 1: Make the Right info Salient
clear, easy action
steps
only the “right”
information
ideal sequencing
of help
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Solution 2: Improve Feedback with Action Steps
clear, easy action
steps
friendly, personal
tone
salient
consequences
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Did the solutions improve aid eligibility?
E-mails increased aid offered by 4%
for minority students
E-mails increased aid offered by 3%
for all students
$6,600
$6,600
$6,400
$6,400
3% increase
($150)
$6,000
$5,800
$5,600
$6,000
$5,800
$5,600
$5,400
$5,400
$5,200
$5,200
$5,000
$5,000
Control
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$6,200
Total Aid Offered
Total Aid Offered
$6,200
4% increase
($182)
Email 1
Email 2
Both emails
Control
Email 1
Email 2
Both emails
Project 3
Take-up of work-study
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Problem: Few eligible students apply for work-study jobs
Fall 2014 data
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Behavioral barriers prevent application
Students did not have the correct mental model about workstudy jobs
Application deadline not salient
Hassle factors in the application process prevented action
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12 e-mails designed to target barriers
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1
Shape the right mental model of SEED jobs —
emphasize financial and academic benefits in
clear language
2
Make deadline salient and force a moment of
choice
3
Reduce hassle factors with plan-making activity
Results: More applicants and applications
Number of Unique Applicants
Number of Applications
**
+30%
Number of Hires1
**
+60%
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hires
in control
**significant at the 95% level
1. Not a significant result. A large portion of applications were never reviewed due to organizational constraints
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<
55
hires
in treatment
Be a Behavioral Innovator on Your Campus:
It’s Easier Than You Think!
FAFSA filing project
Course choice project
2
1
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Work-study project
3

Email platform with standard
RTF or html capabilities

Email platform with standard
RTF or html capabilities

Tracking open and clickthrough rates for emails

Access to parents as well as
students

Particularly relevant if using
Banner CAPP module

Ability to collect parent email
addresses

BONUS: ability to adjust online
registration form interface
Contact Us
Ed Pacchetti - Federal Student Aid
Croom - Lumina
PhilDavid
Schuman
Director of Financial Literacy
Indiana
UniversityLee - Gates
Nicholas
[email protected]
317-274-7430
[email protected]
[email protected]
Foundation
[email protected]
Sarah Bauder - Gates Foundation [email protected]
Josh Martin - ideas42
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[email protected]
QUESTIONS?
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