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College & Workforce Readiness

Study: Giving Aid to At-Risk College Students a Better Bet

By Caralee J. Adams — July 08, 2011 1 min read

Just how to disburse financial aid to students who are most likely to benefit from the support can be a tricky calculation. A new study released Thursday may offer some direction: It shows that giving additional money to at-risk students can be a better investment than awarding it to those who are considered likely to complete a four-year degree.

In the report, Conditional Cash Transfers and College Persistence: Evidence From a Randomized Need-Based Grant Program, researchers at the University of Wisconsin-Madison considered the impact of giving extra need-based aid to first-time, full-time freshmen who received Pell Grants.

The study examined how students fared who had received $1,750 a semester from the Wisconsin Scholars Grant—all of whom were already eligible for Pell Grants and were selected by lottery. It included interviews with 1,500 students—600 of whom got the extra aid and 900 who did not over three years. Some students were categorized as more likely to succeed in college than others.

For those who were more disadvantaged and less likely to get a degree, the additional money was found to have the most impact on whether the were on track to complete college. For example, 72 percent of students who were categorized as having a low propensity to persist and who received the additional aid were still in college three years into the program, compared with 55 percent of students who also had a low propensity to persist and did not receive the extra money.

The extra cash had little statistically significant impact on improving degree success for the other group, initially considered more likely to persist because their parent finished college and they had higher test scores. Of students most likely to persist, 79 percent of grant recipients were still in college three years later, compared with 94 percent of those who did not receive the additional aid.

The reports suggests a need to better target financial aid, but acknowledges doing so without make the application process more complex is a challenge.

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A version of this news article first appeared in the College Bound blog.