Correction Appended: A previous version of this story inaccurately reported the amount of money raised for need-based scholarships raised by the President’s Donor Challenge. The challenge raised $72.6 million for need-based scholarships.
With the tough economy, universities nationwide have recently seen a big increase in the number of students applying for financial aid and scholarships — and colleges have been responding by making more financial aid funds available.
According to Mark Kantrowitz, founder of FinAid.org — an educational website that discusses financial aid options available to students — there was a 56-percent increase in the total amount of financial aid available for college students from the 2008-2009 academic year to the 2009-2010 academic year.
Kantrowitz said the jump in available financial aid is directly related to the increasing number of students that qualify for need-based financial aid during the past year.
“The economy is causing more people to be needier,” he said. “The people in the economy who have lost their jobs are going to need financial aid.”
A 33-percent rise in the total number of Pell Grants available to eligible students may also explain the increase in financial aid. Decided annually by Congress, the maximum amount a student can receive from the federal Pell Grant program also increased from $4,731 to $5,350 in the past two academic years.
Consistent with the national trend, the number of University students that applied for Pell Grants or was eligible for federal aid also increased. Pamela Fowler, executive financial aid director at the University, said the number of University students applying for federal financial aid increased from 22,091 to 24,592 students.
Many University students who had previously been denied financial aid asked the University’s Office of Financial Aid to reassess their Free Application for Federal Student Aid applications, Fowler wrote in an e-mail interview. The office, she wrote, experienced a 40-percent increase in the number of students seeking reassessment this year.
Echoing Kantrowitz’s sentiments, Fowler wrote that more students applied for financial aid because of the recession, but added that she expects the number of applicants to taper for the next academic year.
“Our target freshman class size for fall 2010 is about the same as fall 2009, so the number of aid applications should be comparable to this year,” Fowler wrote in the e-mail.
To meet students’ financial needs, Fowler wrote that the University expanded its financial aid budget, adding the funds raised by the President’s Donor Challenge, led by University President Mary Sue Coleman.
As part of her Donor’s Challenge campaign, Coleman said the University would match dollar for dollar funds raised by the University’s Office of Development during the Michigan Difference Campaign, which ended in November 2008. According to Fowler, Coleman’s campaign raised about $$72.6 million in need-based scholarships for undergraduate students for the current academic year.
For some students, the decision to enroll in the University was heavily affected by the recession and the amount of financial aid available to them.
Business sophomore Mikhail George said he received a scholarship to help cover his tuition costs. George added that he would not have been able to attend the University without the funds awarded by the scholarship.
“The bad economy led to tougher times, less money, so I had to consider my debt when I graduate in this bad economy,” George said.