Last week, CampusLogic released “Clear Disparity: New Data Adds Consumer Voices to Award Letter Confusion Debate,” a research report around student and parent confusion with financial aid award notifications. This research provides the first large-scale survey data documenting what, precisely, students and parents find unclear about a form that is used by millions of families each year to help determine whether a college may be affordable and how to go about paying for it.

The report confirms what many pundits and policymakers have long suspected: award letter notifications are confusing to a majority of the consumers who must read and act on these letters. The report also shows that confusion isn’t a singular idea. Who finds things unclear and what they report as unclear or confusing depends on a variety of factors, including age, household income and race/ethnicity.

The report also shows that what students and families find confusing is a far cry from what financial aid experts predicted. Which begs the question, why such a gap?

Lots of confusion

Award letter comprehension is key to driving student financial success—a strategic imperative for higher education institutions nationwide. A majority of students and parents reported finding some aspect of award letters unclear. Almost 60 percent of students identified some dollar amount as confusing, and a similar percent of parents expressed confusion with some aspect of the wording or phrasing.

Whether that’s a lot or not remains to be seen as we have no baseline to compare our results against. If asked the question, “Does it “feel” high?” I’d suspect most would say yes. Outside of high school and first-year college students, almost every student looking at an award letter has seen one before. Many students as well as parents have familiarity with other financial documents like mortgages and auto or credit card applications. Throw in the fact that financial literacy has been a growth industry and it becomes clear that something big is still missing from our equations. Consumers are still widely confused.

Clear Disparity helps unpack the “something big” of why people struggle to understand award letter notifications.

The people award letters are intended for seem to understand them least.

From a policy standpoint, a frustrating observation from our survey results is that the people who stand to benefit most from clear award notifications struggle the most. A standout finding in the report: Students and parents from households earning less than $25,000 a year disproportionately struggle to understand concepts like Cost of Attendance, especially compared to those who report earnings of $100,000 to $200,000.

Common sense tells us that lower-income students are more price sensitive, which means if they struggle to understand something like the Total Cost, then they’re at serious risk of not securing all of the resources they’ll need to succeed. Funding shortfalls that go unrealized until late in a semester or late in a program are difficult for most families to cover—often leading to debt with no degree. Students with fewer resources to begin with struggle more to cover the gap.

Confusion is personal and multi-dimensional

Different consumers find different things confusing for different reasons—and that’s important in a world where everyone is talking about ‘standardizing’ information. Whose standard matters? The institutions or the students?  Respondents who said, for example, they didn’t understand what a number represented were most likely to select Expected Family Contribution (EFC) or Grants and Scholarships amounts. Yet those who didn’t understand “why” a number was relevant most often selected Cost of Attendance. Traditional-age students more often told us they didn’t understand what a word or term meant while respondents in their 40s were more likely to say they didn’t understand why they needed to know it.

Award letters are sent to students but parents read them as well, bringing a different perspective. Parents often questioned why some things were included and others weren’t. Should schools that cater to a population of predominantly “traditional” students be obligated to report the exact same information in the exact same way as institutions that serve older, or commuter-based, student populations? With evidence in hand to support the idea that confusion is intricately personal, we need more debate around finding a balance between ensuring clarity and presenting relevant information.

Next step: Do more to solve their confusion

The hard truth is that what we’re doing today to minimize confusion just isn’t good enough. We need to think more about the problems that consumers tell us they’re facing, rather than ones we assume they are. We need to think more about how to improve the delivery of financial literacy tools to address the confusion they face. We need to think more about what institutions need to best assist the specific kinds of students they serve.