Dear colleges, You have priced the middle/upper of the middle class out, so...

<p>cpt</p>

<p>it’s not my data, it’s from the national association of college business officers, who, I assume, are in position to know. Here on CC we get a skewed perception of the college access situation. There are thousands of colleges in the U.S., but we talk endlessly about a very small subset of those colleges, usually the most selective and expensive, and we hear the frequent complaint that higher income folks are being “priced out”. If we step back and take a look at the overall picture, that’s not true. The higher your income the more choices there are, and vice versa, as your income drops the fewer choices there are. The skewed perspective here on CC, leads to ridiculous statements like the one above, “The HAVES are the lower income folks who get the deal of the century sending their kids to elite schools” a frequent stated sentiment here on CC, which is only true for a few thousand very high achieving low income students a year. What’s really happening in college access is the rapid stratification of higher educational access based on income. That trend is moderated somewhat at a small group of elites by an admittance system based primarily on documented achievement at a very high level and a payment system based on the notion of paying according to one’s means as determined by the college.</p>

<p>To those who say either pay the price or be quiet - anything else is whining - I say No Way! Why shouldn’t I try and do my tiny part to convince colleges that this funding model has serious drawbacks, which will continue to worsen? Why not speak out - even in some small way- and tell them that I object to sales effort which characterize tuition payments as always affordable. Furthermore, every college, public or private receives my hard-earned tax dollars in some manner.</p>

<p>As long as rich people are lined up ten deep to pay for the elites, you can speak out all you want, but money talks and there’s plenty of apps willing to pay.</p>

<p>What private colleges do is one thing, and not one I’d bother fussing over, but when state universities are graduating lower income kids with 30, 40 , 50 thousand in debt, that’s a battle worth fighting.</p>

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Funding is not a cheery, exciting topic. Colleges don’t charge tuition because it makes them happy, they charge it because they are businesses and need cash in order to operate. If you are paying, they have already won. Griping will do nothing because they really don’t care if you feel warm and fuzzy about their pricing schemes.</p>

<p>Regarding tax dollars, it is an entirely different issue to complain to state representatives about your local state U’s pricing arrangements. I don’t buy the idea that research and/or federal grants should be contingent on undergrad pricing systems that are completely irrelevant and unrelated.</p>

<p>I am also uncertain as to why you assume that private universities care about the middle class. If their goal were to educate the people of America, they would double their enrollments.</p>

<p>@garland re post #140: THANKS! I really do think that many of the folks here on CC really don’t understand what your and my low income students struggle with on a day-to-day basis just to <em>try</em> to obtain an education.</p>

<p>@speedo re post #141. I agree with what you’re saying.</p>

<p>How many times on this thread have we seen people say their kid is <em>priced</em> out of Harvard since they earn $100K to $200K? I finally looked it up:</p>

<p>From the Harvard Admissions web page ( [Harvard</a> College Admissions § Financial Aid](<a href=“http://www.admissions.college.harvard.edu/financial_aid/index.html]Harvard”>http://www.admissions.college.harvard.edu/financial_aid/index.html) ):</p>

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<p>So a family with $180K of income can’t afford to throw $18K at Harvard if they’re kid gets in? I’m sorry, I don’t have any sympathy here: At my lowly fourth-tier faculty salary of around $70K, my kid’s EFC is $15 and I’ll <em>find</em> a way of covering that <em>without</em> any loans. [Mind you, his FA package contains the maximum amount of Staffords, and I’ll have to have him take them to get his private college’s bill down to my EFC.]</p>

<p>Yale says ( [Yale</a> Cuts Costs for Families and Students | Financial Aid | Freshmen | Office of Undergraduate Admissions](<a href=“http://www.yale.edu/admit/freshmen/financial_aid/yale_cuts_costs.html]Yale”>http://www.yale.edu/admit/freshmen/financial_aid/yale_cuts_costs.html) )</p>

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<p>Princeton provides a chart at [Princeton</a> University | Who Qualifies for Aid?](<a href=“http://www.princeton.edu/admission/financialaid/how_it_works/who_qualifies/]Princeton”>http://www.princeton.edu/admission/financialaid/how_it_works/who_qualifies/) . They are more expensive for the $150K to $200K income group, but the chart indicates that 100% of the applicants with incomes below $180K are given <em>need-based</em> <em>grants</em>. The grants for the applicants with family incomes between $160K and $180K average $25,950, which leaves an out-of-pocket bill for the family of just over $21K.</p>

<p>So maybe some of these $100K+ families shouldn’t be so quick to write off the (high) Ivies as <em>unaffordable</em> and tell their kids a different, but TRUE fact: You can’t count on getting into HYP, so where else would you like to go?</p>

<p>And for what it’s worth, my kids didn’t apply to any Ivies either—they knew their very, very strong stats were NOT competitive for the Ivies and they didn’t want to bother.</p>

<p>So an honest question: Since the truly elite schools extend FA eligibility well up above $100K, offer generous aid not based on unaffordable EFC, and promise to meet full need, is the real problem that the privates just below that stratosphere often don’t promise to meet full need and aren’t so generous? Those schools are also known to gap the low FAFSA EFC kids by quite a bit too.</p>

<p>Some of the elites are really on the verge of moving beyond our normal concept of “pricing”. If and when the stock market rebounds, with endowments in the billions, some of these colleges really don’t need to charge at all. The price is artificial. They could make it free or make it 100K a year and it really wouldn’t make much difference. In fact, probably the higher it goes, the more rich people would apply. What isn’t arbitrary is the percentage of full payers, which despite all the claims of “need blind” admissions remains remarkably stable year after year.</p>

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<p>The problem with this approach is that it abruptly end the FA at $180K. It should be extended all the way so that every one only contribute 10% or what ever a college decide for their children.</p>

<p>What is problematic is that one family pays $18K even though AGI is $180K while another family with an AGI of $220K pays $50K.</p>

<p>robinsuesanders: Even Princeton doesn’t provide any FA above $200K unless you have special circumstances.</p>

<p>There is no whining or complaints here but what is wrong in having a simple model for FA.</p>

<p>AGI up to $60K - EFC 0%
AGI above 60K - EFC 10%</p>

<p>So by the time you reach $500K 10% will cover all the expenses anyway.</p>

<p>I don’t really understand the purpose of having such a high price if you’re going to have a majority of the students on financial aid. Basically what that says to me is the discounted financial aid price is the real price, and the sticker price is the “rich person premium.” I’m mostly playing devil’s advocate here because truthfully I am very grateful that financial exists and when it is used properly it is an incredible tool of social mobility, but I can’t help but bristle a little at the fact that my parents are paying much more than the majority just because they can.</p>

<p>As my economics teacher likes to say, college pricing is pretty much the only successful instance of first degree price discrimination in America - namely, charging people the highest you think they would be willing to pay. That way there is no “consumer surplus” leftover. Say my parents were willing to spend 50k for college. If college then costs 30k, my parents technically get 20k in surplus that they would have been willing to pay. The current model of college payment allows colleges to determine that reservation price (through use of the financial information you supply them) and then determine the maximum amount they think you will be willing to pay - in this case 50k - and charge you that. Thus the consumer surplus (in this case 20k) goes into their pockets.</p>

<p>@ParentOfIvyHope – While I don’t agree with your solution I hear what you’re saying and you do have a point.</p>

<p>@robinsuesanders – Yes, HYPS are the only schools where the middle class people that I rub elbows with will receive need-based financial assitance. But none of our kids can get into those schools.</p>

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<p>The private colleges below the elites don’t have the endowments to offer the kind of financial aid that HYPS does.</p>

<p>"Basically what that says to me is the discounted financial aid price is the real price, and the sticker price is the “rich person premium.” "</p>

<p>The sticker price is the rich person premium for kids who do not have great stats and who really want to go there and have parents who are willing to pay. If the average SAT score is 1800 and your kid has only 1600 you can buy your way in - it’s the American way.</p>

<p>@jackpot – I think your economics teacher is looking at this in the wrong way.</p>

<p>First, at any college tuition does not cover what it really costs the college to educate a student. The true cost is higher, I’ve heard the figure $80,000, but I can’t site a source for that. The portion of a student’s education that they don’t personally pay in tuition is made up through the college’s endowment.</p>

<p>I think a school like Harvard could charge even more than they do, even the full $80,000 that it costs them to educate someone, and still be able to fill up its freshman class with full pays. Of course, the class would be from only wealthy families.</p>

<p>This is not what Harvard or any school wants to see. They don’t just want their education to be available for those who can pay the full sticker price, they want their education to be available to anyone, regardless of ability to pay. Hence we have need-based assistance. It’s an inspirational sentiment, although I do agree that the philosophy is not realized in practice.</p>

<p>What your economics teacher sees as capitalism run amuck I see as an attempt to bridge the gap between the rich and the poor.</p>

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<p>With all the states that are going broke, this can only get worse.</p>

<p>I don’t think EFC is 10%, my experience it is 1/3 to 1/4. of income.</p>

<p>so for example $50,000 in income- then you have an EFC of $15,000.
Income $100,000?
EFC is $30,000.</p>

<p>Tuition at a 100% need aid school ( for example) is $50,000.</p>

<p>First family pays $15,000- to the school- the remainder ( and ironically- what they have to live on…after taxes is $35,000 which is covered in the aid package- of grants- loans and work study award) </p>

<p>Second family only qualifies for $20,000 in aid- but they have $70,000 to live on ( after taxes) after they pay tuition ( which is also covered by loans and grants and work study)</p>

<p>The student from the second family likely has a smaller grant- but also smaller loans.
Their parents are more likely to be educated, to be able to afford to live in an area with a decent school district & more likely to be able to access resources ( or have experience) with supporting their childs growth.</p>

<p>100% need met- need only schools are more often private and considered competitive and rigorous ,
if you allow that they still have enough full pay applicants who could fill the school if no aid was offered, and that for a low income student to be able to reach the same level of accomplishment that qualifies them for the same admission as a student from an affluent and educated background- doesn’t that then sound like the lower income student- is the superior intellect- does more with less?</p>

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<p>Well, no, that doesn’t follow…</p>

<p>There’s a lot of unfairness about fin aid.</p>

<p>I know it would be very difficult, but I wish they could consider cost-of-living. 190,000$ a year is a LOT less in San Francisco or Manhattan than it would be in rural Montana or Alabama. But incomes are not adjusted for cost-of-living. My family pays a lot more for gas, property taxes, even bread and milk than a family living in another part of the country. So a lot more gets taken out of our income to pay for basic necessities, making the amount we can afford for college less. But Fin Aid in no way considers this.</p>

<p>And what’s with financial aid at the elites stopping at 180,000? So if your family makes that much you pay 18,000, but if yours makes 190,000 you pay 50,000? That doesn’t seem right to me.</p>

<p>emerald - 10% is on the average for income between $120K-180K on a sliding scale from x% to 0. That’s not bad. They are covering everyone up to 96-7% households.</p>

<p>At some places in Manhatton, people pay $500 for a glass of wine because they can. You can’t turn around ask the rest of the country to help pay for your lifestyle by adjusting cost of living, “Look I have to pay $500 for a same glass of wine you pay $5. You should give me $495 break.” Shouldn’t you just not drink it?</p>

<p>It just seems to me that colleges just don’t dole out much of their financial aid because a kid is poor. They do it because the kid is poor AND HAS POTENTIAL. Colleges are all about raising their prestige. All-in-all, why recruit a poor kid who has not had the benefits of college educated parents and is much more likely to drop out of school? Unless that kid has much more potential than a middle class kid with a 3.0 GPA and 1500 SAT’s. </p>

<p>My conviction is that if you have a kid with a high GPA and SAT scores, colleges WILL try to entice with generous financial aid.</p>

<p>The problem is that we have several different groups of colleges…</p>

<p>Ivies/elites with super endowments who can be extra generous with no or very small loans.</p>

<p>privates/a couple of publics with endowments that they meet need with grants and (sometimes good-sized) loans.</p>

<p>privates/publics with some endowments who can only afford to be generous to those they especially want with preferential packaging.</p>

<p>publics (like the UCs) who can be generous to those with very low EFCs, but not to anyone else because of generous state aid and some endowment money.</p>

<p>publics and privates who don’t have much endowments and can only give fed aid (and maybe some state aid) - which is only a small dent to the cost.</p>

<p>There’s probably a group I’ve left out, but the point is that there can’t be a one-size fits all solution because each group above is like a super rich family, a rich family, a middle class family, a low-income family, and an impoverished family. Who could expect a solution to work for all?</p>

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<p>It is with silly statements like this on CC, and on press, that give people wrong information and get people all worked up. What you are saying here is that the reason people live in NYC do not have money saved up for college is because they are drinking 500 glass of wine. Do you really think that? Or do you think before you write? What about having to pay 4-7000/month for a 2-3 bedroom apartment, so your kids could go to a decent public school? what about having to take taxi sometimes because it is not always safe to take a subway. What about having to pay close to $800/week for a nanny so you could continue to work? Yes, you could send your kids to day care, but I bet you day care in NYC probably costs 2-3 times more than other areas.</p>

<p>No, people could choose not to NYC, and they could live cheaper outside, but it then also get into a choice one needs to make about commuting 1.5+ hour each way (3 hours away from the family everyday). </p>

<p>When one wants to make a point, at least try to use an example that’s at least close to reality.</p>