Financial aid is an important part of the college process. Since a higher education is not free, and, in some cases, not cheap, many students rely on assistance to pay for schooling.
Many people voice their concern about how much tuition has increased over the years while aid has decreased, but financial aid has been needed and distributed for centuries now.
1643: First Scholarship Established
In 1643, Lady Anne Radcliffe Mowlson established the first scholarship at Harvard University, essentially making financial aid over three centuries old.
Almost 200 years later on the same campus, the first student loan program was born. Scholarships, which is money that you do not have to give back, relieve the heavy financial burden for a lot of students.
1935: The First Financial Aid Association
Indiana Student Financial Aid Association was the first state financial aid association, coming to be in 1935. This became a trend as the years went on, enabling more students to be able to attend college.
1944: GI Bill
The GI Bill, also known as the Servicemen’s Readjustment Act, made its debut in 1944. With this bill, those in active service had an additional incentive to complete their secondary education.
1965: Stafford Loan & Pell Grant
1965 saw the beta-version of the Stafford Loan Program (then named the Guaranteed Student Loan Program) and the Pell Grant (called the Educational Opportunity Grant Program). These opportunities allowed students to pay for their schooling in increments, as well as provide them with more “free money”.
In 1966, NASFAA (National Association of Student Financial Aid Administrators) was created. This important association has opened the door for a multitude of students to attend college now that they have more financial options.
1972: Sallie Mae
Sallie Mae came to be as the Student Loan Marketing Association in 1972, and is still used to this very day. Sallie Mae gives students the chance to build their credit while paying off their loans.
1983: Student Loan Consolidation and Technical Amendments Act
The government began to step in with the Student Loan Consolidation and Technical Amendments Act of 1983, which made the GSL interest rate 8%. This was another relief for students who had multiple loans.
1993: Student Loan Reform Act
The Student Loan Reform Act added income contingent repayment and jump-started direct lending. This act made it easier for students to be able to pay back their debt.
Later in the 90s, monumental milestones were achieved including the establishment of the FinAid website in 1994, FastWeb in 1995, FAFSA on the web in 1997, and the online version of FAFSA in ’98. Making websites like these gave more students access to funds available to continue their education.
Although the recession has made financial aid a more crucial deciding factor in which university students are choosing to pursue their education, financial aid is not new, in fact, is older than some universities.