Rethinking Access: A Closer Look at Student Aid Proposals in the "Big Beautiful Bill"

Changes to federal student aid in the recently passed “Big Beautiful Bill,” has one issue weighing heavily on the national conversation: access — particularly for students and families with the greatest financial need.

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Changes to Pell

To avoid sounding too critical, it’s important to acknowledge the expanded access to Pell grants for students that are pursuing short-term programs at accredited institutions. This is a big win for students that take a less traditional pathway to a career. Unfortunately, the Big Beautiful Bill has less good news than bad for many students and their families. For one, some changes to federal methodology could exclude some students from Pell grants in the future – particularly those with higher SAIs, foreign income exclusions, or recipients of non-federal grants that exceed their Cost of Attendance.

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Restructuring Parent PLUS

The new law includes major changes to the Parent PLUS loan program for the 2026-27 school year. It imposes a $20,000 annual cap per dependent and a $65,000 lifetime borrowing limit per dependent on parent borrowers. Luckily, an earlier version requiring the student to take their full subsidized loan didn’t make it to the final version, still these caps would disproportionately affect middle- and lower-income families whose out-of pocket costs often exceed traditional aid packages. These limits will push families into private markets or force difficult choices about where — or whether — a student enrolls, since many will struggle with identifying credit worthy cosigners.

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Threats to Graduate Financing

Graduate students are also at risk, since the law eliminates the Graduate PLUS loan entirely beginning with the 2026-27 school year and reduces borrowing caps on federal unsubsidized loans. While some private lenders may fill the gap, that is not a viable option for everyone. Many graduate students, like their undergraduate counterparts, will not have credit history or co-signers needed to qualify for private loans.

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This shift would remove a critical pathway for thousands of talented students pursuing careers in law, education, public health, and other graduate fields that rely on federal loan access to remain within reach. The risk of shutting out those who most need these opportunities to achieve upward mobility and contribute to their communities is substantial.

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New Loan Proration Threatens Student Completion

One lesser-known provision of the new law requires institutions to prorate the maximum loan a student can receive proportionate to their enrollment level similar to the current Pell grant rules. While this initially sounds reasonable, consider that many students bring college credit from high school to their undergraduate pursuits. In such cases they often graduate early or do not have to take a full-time courseload in their final term to graduate.

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These high achievers will now be financially penalized. And for those considering adding electives to maintain full-time status — not so fast. There are already provisions that exclude courses from financial aid eligibility if they are not required for the students’ degree.

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A Call for Balance

These changes are framed as steps to limit student debt and federal spending — both are important goals. But there are also unintended consequences; they may unintentionally limit student opportunity. It is important to ask: Who pays the price for these changes? And what new supports are being offered in their place?

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The costs of providing federally funded access avenues which lead to productive graduates who repay their graduate loans — with interest — and contribute to the broader tax base as higher-earning individuals seems like a reasonable investment. Whatever happened to education as a public good?

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As the impact of these changes become better understood, a more balanced and equity-minded approach will be essential — one that achieves fiscal responsibility without restricting access to the American dream. It is critical that future policymaking reflects this need and considers the long-term consequences for students and families. These reforms warrant continued dialogue and advocacy to ensure that access to education remains a national priority.