A recent article via Forbes.com asks a fairly interesting question regarding financial aid for students attempting to attain a higher education.

Does financial aid help colleges more than students?

The article is based on a report via the Federal Reserve Bank of New York that shows how well financial aid works for students.

“Students pay an extra 55 cents in tuition for every dollar of Pell Grant they receive, meaning they only save 45 cents in terms of out-of-pocket costs. Colleges gain even more than the 55 cents from each dollar of new Pell Grants because they collect the extra tuition from all their students, including all the ones who do not receive Pell Grants.”

Basically students can’t seem to catch a break.

The study goes further by stating that student loans make the situation worse as “college tuition goes up by 70 cents for every extra dollar of student loans.”

So basically, if the federal government truly wants to help drive down the cost of higher education and help students, making student loans and Pell Grants more available to students isn’t the best route to take.

The other part of that is how may students attain capital in order to attend college without help from the federal government? Is there a way to place caps on the tuition charged to students who receive loans and grants? If so, then that would make the playing field uneven for everyone.

Certainly a study worth looking further into, the government has to find ways to ensure that colleges aren’t unfairly profiting off of programs meant to help students.