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Summaries of RCT Grants

RCT of providing college students with federal loan eligibility information

This project comprises of two randomized controlled trials (RCTs) of providing low- and moderate-income students with information on their federal loan eligibility as part of the students’ financial aid award letters.

Grant Recipient: University of Illinois at Urbana-Champaign

Term: 2019 –2022

Principal Investigators: Benjamin Marx, Ph.D., University of Illinois at Urbana-Champaign

Lesley Turner, Ph.D., Vanderbilt University

Funding: $245,489

Summary: This project comprises of two randomized controlled trials (RCTs) of providing low- and moderate-income students with information on their federal loan eligibility as part of the students’ financial aid award letters. Providing such information is not the norm at many postsecondary institutions (particularly two-year colleges). The goal of this informational intervention is to increase college enrollment, credit accumulation, academic performance, and student financial health.

This intervention is backed by promising prior evidence. A well-conducted, single-site RCT found that providing federal loan information in award letters to community college students significantly increased their loan uptake, credit accumulation, GPA, and likelihood of transferring to four-year institutions.

This grant will fund two separate replication RCTs within an anonymous college system – one at a community college and one at a bachelor’s degree granting institution, with a total sample of approximately 30,000 students across the two trials. Within each school, students will be randomly assigned to either (i) a treatment group that receives an award letter with information on their federal loan eligibility, including a loan amount that they may qualify for; or (ii) a control group that receives the status quo letter with no such information.

Over a two-year follow-up period, the study will measure the impact of the intervention on college enrollment, credits earned, academic performance, transfer to a four-year institution, and measures of financial health. Outcomes will be measured using administrative data from the college system, the National Student Clearinghouse, and credit bureaus.

The study’s pre-specified pre-analysis plan will be posted shortly.

Grants

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