Ability to Pay and other trends in admissions

Parents Forum
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<p>It’s gaming the system. In some cultures, money and assets are fluid between extended family members. If you brought that over here, theoretically you could have a family business with the grandparents owning the business, the parents working in the business and collecting a very small income while their actual assets are “owned” by their parents. This would make them look quite poor for FA purposes.</p>

<p>A coworker told me of a family that they knew that basically reported very little in the way of assets by assigning ownership to extended family and received very good FA despite significant assets. Of course there is always the risk that the extended family members could keep the assets - I guess that it’s a matter of trust.</p>

<p>At any rate, setting the rules invites people that try to game the system.</p>

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<p>We have that now.</p>

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<p>nightchef</p>

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<p>You are looking at just a FAFSA calculation. There are not a lot of schools who use FAFSA only and meet full need. Many of the pirvates are Profile schools and I can tell you that for these schools, from where you are with $75K AGI, the EFC goes up exponetially for every extra dollar earned</p>

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<p>I often see the word “strong” and “great” being used without a frame of reference. Strong and great for whom and relative to what? A program may be “strong” for a C average student from a middle of the road public high school senior, but the same program may be very “weak” for an A student from a magnate school.</p>

<p>There are some schools and programs that majority of educated folks would agree are “great” and “strong”, e.g, UC Berkeley and JHU BME. It would be nice to compare a suggested “strong” school or “great” program to one of the well established ones so the audience can relate better.</p>

<p>A program may be “strong” for a B average student from a middle of the road public high school senior, but the same program may be very “weak” for an A student from a magnate school.</p>

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<p>I think that something like 70 to 80 percent receive FA at my son’s school. Average graduating debt is below $20K and I think that a lot of students pay between $2,500 and $7,500 for tuition and fees. Sticker is $10K. At the $2,500 price point, you can pay for most of your tuition and fees with the American Opportunity Credit. My personal feeling is that inexpensive public state universities and community colleges do the heavy lifting for students from the lower and middle classes.</p>

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<p>They do. This is why folks posting that losing a few hundred seats at ivies will disrupt changing the poverty cycle gets my eyes rolling. It’s these schools that are providing the most upward mobility.</p>

<p>California does have an organized system of CCs, and the methods they have used to get kids to go on to 4 year state schools have been fairly successful. But they are not the utopia painted in many posts here. Nothing like the NY one mentioned which caps class at 25, etc. </p>

<p>They are commuter schools where there’s a huge mix of students. Some right out of high school there because of bad grades or money, some there because they didn’t make it in 4 year colleges and lots of older people seeking career changes. They are overcrowded to say the least and most of the profs do not have PhDs.</p>

<p>Friends who teach there rant and rave about how most come in not knowing how to write a paper and leave not knowing how to write one. </p>

<p>IMO, the tragedy is the states being broke and letting these schools continue to decline. In our day these schools changed lives, it remains to be seen what will happen now.</p>

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OK, I just ran the “institutional methodology” calculator on College Board and here’s what I got, with all data exactly the same except AGI, earnings from work, and income tax paid (I’m adding $3K more tax for each $15K of additional income, even though the tax bite would probably go up faster than that, which would further moderate the increase in EFC):</p>

<p>$75K: $16,809
$90K: $18,798
$105K: $21,612
$120K: $25,070
$135K: $29,502
$150K: $33,741</p>

<p>So a $75K increase in income amounts to only a $17K increase in expected contribution. If this is an “exponential” increase, the exponent is pretty tiny.</p>

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<p>^^nightchef, popping that in Excel gives EFC = 8091.7<em>exp(.000009</em>AGI)</p>

<p>:)</p>

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<p>Using that calculator my parents should only be paying about $2500 towards my 50k/year education…Well that is so not happening, no wonder they’re drowning in debt</p>

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<p>R6L–
Your parents are planning to fill out the FAFSA, aren’t they?
And if you apply to Smith, do they (Smith) have their own financial aid form? </p>

<p>In any case, your folks should write a polite & friendly letter to the FA office in which they include a list of your family’s monthly bills that cannot be changed. Not charge cards (“consumer debt”) but bills such as mortgage/rent, utilities, medical bill payments, tuition to siblings’ school if any, health ins etc. Include phocopies of these bills. Don’t forget that most FAOs earn far less than a lot of the people who think they deserve aid at their schools and don’t let it look like you believe you are entitled to the world just because you got in (that was the AO’s decision, not FA’s).</p>

<p>FA offices and the FAFSA work off tables showing regional averages of cost of iiving. But one family’s cost may be very different from those averages. If the regional average of heating oil is $1.70/gal but in your town it is $2.30, it makes a big difference in your monthly bills. </p>

<p>An average is not attending the school; a child from a family is. If the school has any ability to make adjustments, they will use your family’s own figures when calculating FA.</p>

<p>We did this when our oldest was attending an Ivy. Smith is as able as most Ivies to meet your need if they want you there as a student.</p>

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<p>hmom5 - Ah, but who belongs to the “upper middle class”? Schools like Carleton and Chicago currently cap their loan initiatives at around 75k or 80k. My family makes 85k (in a good year), so now we are upper middle class despite having an estimated financial need of more than half COA?</p>

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I agree with “education” but not “fit.” For example, as someone whose preferred learning style is well-suited to LACs, and also seeking a challenging peer group for humanities discussion, neither CCs nor large universities (public or private) are good “fits” for me. However, I could certainly get a great education at most of them (admittedly I have heard nothing but bad news from friends about their experiences at our local CC vs. the local flagship U).</p>

<p>BCEagle - A true sliding scale at publics would mimic current optimal FA policies without a tuition “cap” for the upper-middle-class.</p>

<p>Remember that nightchef’s scale assumes the same assets. It seems like a lot of upper-middle-class families get hit hard by assessment of savings and home equity. AND, the EFC is only useful if your college is one of the handful that meets full need without significant loans.</p>

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<p>Nightchef, those IM EFCs look low. I’m guessing you put in zero assets? Most families I know making $150 will pay full freight at all but the most generous privates.</p>

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<p>Again, Keilexandra, most people think a Mercedes would be a far better fit for them that a VW Bug. Even in your socialist home country, kids do not get to choose from many LACs. </p>

<p>A preferred learning style, unfortunately, can not be an issue for most students everywhere in the world. Getting an education at all is still at issue for most.</p>

<p>And $85K, by definition is upper middle class in America. It doesn’t mean you live like royalty, but it means you have considerably more income than the average American. I understand your family has financial issues and the generous schools will address them, but as said above, many families are pleading poverty to aid officers who make half what they do.</p>

<p>Read some of their posts. Families driving up in luxury cars, having sent their kids to $5K summer programs, insisting they are broke.</p>

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<p>Well, noone has infinite income and, at the end of the day, these are competitive markets.</p>

<p>Still, if you have $10K tuition and fees and can get FA of $5,000 and a tax credit of $2,500, you’re only left with $2,500 in loans or summer jobs.</p>

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<p>This is a function of K12 schools. We’ve pushed the problems up through the grades
and into the college system. If the K12 schools did their jobs, there would be far
less need for remedial instruction and more productive use of classroom time at CCs.</p>

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I put in our assets, which are indeed near zero (under $10K) when it comes to savings, but include about $200K in equity.</p>

<p>When I up the savings to $50K and double the equity to $400K, the figures all go up by $12K, which does push the $150K family to just under $46K–close to full freight, though still several thousand short at many privates.</p>

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<p>hmom - Indeed, the closest to an Canadian LAC would be Mount Allison, which has the size right but not the “liberal arts” part as much.</p>

<p>For the US citizens who are knowledgeable enough to have basic preferences regarding education, it’s a reasonable societal goal to help them afford those preferences. Obviously no society is perfect, but the ideal remains important.</p>

<p>Lots of people can’t afford a Mercedes but will sacrifice to buy a Corolla instead of a Bug because, for instance, their five-person family makes a four-car vehicle far more convenient.</p>

<p>BCEagle - I thought we were doing away with FA. A sliding scale tuition plan would have the poor paying nothing (in tuition) and the rich paying, let’s say, 20% of their income–end result, the wealthy don’t bother to attend publics due to cost. This would simply reinforce the classist divide between public and private universities, an existing barrier that is perhaps unique to the United States.</p>

<p>Loans/jobs in your hypothetical scenario would have to cover not only 5k in tuition (tax credits aren’t credited until the end of the year) but also year-round living expenses and books/lab fees (often tacked on per course, not with tuition).</p>

<p>nightchef’s EFC-analysis is quite interesting. What would happen with, say, $60k savings and $300k equity? Reasonable numbers for the “middle class,” IMO. The $150k family also probably has higher living expenses than the $75k family, due to lifestyle choices (not always true, before people start chiming in with exceptions–but true as a generalization).</p>

<p>I remember in seventh grade Health class, the teacher had us figure out monthly costs for housing and food. She wouldn’t believe me when I told her that my mom spent $200 a month on food for a family of 3–and our meals were far from extra-frugal compared to the grad-student days. Massive rice consumption probably helped, but we’ve always been a red-meat family and we hardly ever buy legumes, so it balances out.</p>

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<p>VW Beetle has a higher MSRP (by about $3,000) compared to a Toyota Corolla. The VW Beetle’s a better car if you are very tall.</p>

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<p>FA is provided by the Federal and State Governments for public schools. They may be funded by charging OOS students above the cost of education too. They can get private donations as well.</p>

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<p>Someday you’ll live in the real world. The classist divide that you think exists
in publics, isn’t.</p>

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<p>^Oops, my mistake for not checking prices… But anyway, the example given was a five-person family that would need to use the backseat multiple times every day, rather than a very tall person. Different needs.</p>

<p>What is the difference between “private donations” and private schools using endowment monies to fund FA?</p>

<p>The class divide between public and private universities has existed in public perception for a long time–and public perception, i.e. prestige, is what drives this instance of classism. Things are getting better, but as I said earlier, a true sliding scale would more than reverse any progress.</p>

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<p>If you have a five-person family, you could also buy a used car for a third of the price.
Many people don’t have a choice and go for the used vehicle. Having a choice of brand of used vehicle is a small luxury. The choice of a new car would be a large luxury. We bought our first new car after 20 years of marriage. We sold our cars at 225K and 185K miles respectively.</p>

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<p>Private donations are targeted.</p>

<p>Endowment money isn’t magic. It ultimately comes from somewhere.</p>

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<p>Worrying about reality > worrying about perception.</p>

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<p>This drives me insane. They do everything on their wish lists and have somehow come to expect financial aid to cover their costs for an education because their kids got good grades. I am dead serious when I ask when the heck it became so unpopular to save money for your children’s college education? Is this a direct result to the public outcry over huge endowments and improved financial aid policies at schools like Harvard in the 90’s? Did parents just start dipping into college funds to pay for camps and other expensive ECs?</p>

<p>Also… While I believe fit is important, there are plenty of large universities that allow for deep and complex debates and discussions in class. This doesn’t only happen at the LAC. They have recitations and those usually consist of 20 people or so. Even at s’s relatively small school, one of his class days is reserved for discussion and the other days, the professor reserves for lectures. Now, maybe there is some room for flexibility in a smaller class than a large lecture hall, but wanting to attend a smaller LAC and needing to are two very very different things. And from my experience, once you get beyond any kind of intro classes at a large university, class size gets pretty small. No, not 10-15 students, but 30 isn’t THAT big.</p>

<p>And while not very PC in the least, I also don’t understand how international students (and that would include Canada) have a right to take issue with US dollars in financial aid. If you don’t like it, you certainly have your own country in which to attend school. I would guess that the reason there is such a flood into the US is the perceived quality is better. And while I have no idea how it works when American students go to school outside the US, I ask the question with genuine interest: Do schools in the UK, China and Canada offer our students financial aid to attend their schools?</p>