The University will begin sending debt letters to students at the end of each spring semester, allowing them to see how much debt they’ve accumulated as result of financial aid.
“UT-Austin strongly supports keeping college affordable and helping students graduate with as little debt as possible,” communications coordinator Kendall Slagle said in
In 2017, the Texas Legislature passed Senate Bill 0887, requiring all institutions of higher education that participate in a state financial aid program administered by the Texas Higher Education Coordinating Board to send debt letters.
The letters will only include state financial aid, so Slagle said students should keep in mind any aid they receive outside of state aid.
Indiana University pioneered the debt letter initiative in 2012. Six years later, the total loans decreased by about $125 million, said James Kennedy, associate vice president of
University Student Services and Systems at IU.
“Hopefully, there are no surprises,” Kennedy said. “Every year, you know exactly how much you have, what the estimated payment amount is going to be, so when you get out you can start to plan earlier on.”
Carly Williams, English and health and society senior, said she thinks UT debt letters would be a “double-edged sword” for students, because along with the benefit of knowing the amount they have taken out in loans comes the burden of financial stress.
Williams said UT has the resources to promote financial awareness, but they do not do enough to advertise them.
“A lot of the time students feel like they’re completely on their own with money issues and then really only reach out to financial aid if it’s a dire issue, not in the build-up,” Williams said.
At Indiana University, Kennedy said they do three things to create more financial awareness. These resources include an Office of Financial Literacy, where they do outreach initiatives and programming, a financial aid office, where they send debt letters and look at award letters, and an emphasis on graduating in four years.
“I think the debt letter is a good start, but I think, overall, just the counseling that we provide and information and how we can get that to students is really important,” Kennedy said.
Although Kennedy is happy about the decrease IU has seen in loans, he said loans are not necessarily harmful.
“Student loans are a great way to finance your education, but the key is you don’t want to have excessive student loan debt,” Kennedy said.