Going to college is one of the biggest financial decisions individuals make in their lifetime. For many, it is their first big financial decision. Always, students must carefully consider many financial factors, especially the financial aid packages they have been offered. This year, students must also understand whether their college will survive (be financially solvent) long enough for them to graduate.
First, financial solvency refers to the school’s ability to meet long-term debts and financial obligations; if not, the school may cut programs or staff, reduce services, and perhaps even close. Students need to understand if they can enroll, stay enrolled, and graduate. If not, the cost is too high to bear, even if a student’s dream must be deferred.
Second, some schools have already declared financial exigency, which is their way of announcing imminent financial crisis that threatens the survival of the school. There are two schools in Missouri which have declared financial exigency: Lincoln University and Missouri Western State University.
At The Scholarship Foundation, we are closely monitoring schools’ financial solvency and, as we have identified colleges where the risk is great, we are working with students to initiate transfer plans or create a contingency plan, in the event their campus announces financial exigency or closes entirely. After reviewing several financial solvency indices, we are using scores from a few to inform ourselves:
- Forbes’ 2019 College Financial Health Grades
- Department of Education Financial Responsibility Scores
Those of us working with students have an ethical responsibility to ensure students understand the possible risks to enrolling or returning to an institution where financial solvency is in doubt.
Things can, and will, continue to change as summer progresses. What seems true today many not remain the same in the coming weeks. The Scholarship Foundation will continue to issue advisories. If you would like to sign up to receive these advisories in your email, please subscribe here.
Students—We encourage you to find your school on one, or both, of these lists. Unfortunately, the available lists do not include every single school. Whether you can locate your school or not, if you have serious concerns about your college’s financial solvency and would like to speak with one of our Student Advisors, please complete our intake form and we will be in touch ASAP.