Financial market impact on Endowments, Financial Aid, Applications, etc.

<p>Pan, I have no idea! I would think that full pays are a prized commodity in ANY given year, but even more so this year. I don't know what percentage of applicants also apply for FA (though I would love to have that info) but I cannot help but think that schools may be able to "find room" for those who can bring more than their talents and ambitions to the table this year, namely 40K+</p>

<p>Well, if most schools provide aid for between 30 and 50% of enrollees, and if you assume that applying for aid does not confer a disadvantage, then does it follow that between 30 and 50% of applicants ask for aid? Or does applying for aid alone confer a disadvantage, so that more than 30 to 50% of applicants ask for aid?</p>

<p>Are you kidding, the good schools are inundated with applicants from students who can pay in full. The vast majority of schools provide aid to fewer than 30%. They will be less diverse, but even in this economy there is no shortage of familes that are happly to pay full cost. And Pan, where did you hear that applying for aid is not a disadvantage? While a few schools may be truly need blind, it's very, very few.</p>

<p>Where did I hear that applying for aid does not confer a disadvantage? Well, if you read their websites, almost all the schools, including those that are not "need-blind" whatever that means, tell you that decisions in relation to admission and financial aid are separate. It is the exception that concede that applying for aid may confer a disadvantage. Be that as it may, only about 5% of American families have the wherewithal to write a $40,000 check ($43,380 next year for Choate) for a single year of high school, so such families are abviously grossly overrepresented at boarding schools. I personally think that all the schools just tell you what is politically correct on their websites, and that checking that box for aid confers a disadvantage at each and every school. They ought to just tell you the truth. Whatever your ideals and however altruistic you are, money talks. Always has, always will.</p>

<p>There are some schools that say applying for aid could reduce your chance of getting admitted (e.g. Hotchkiss, Choate), and some go so far as to discourage people who have the means from applying for aid. I don't think they deliberately lie about it, but to what extent they consider whether an applicant is applying for aid in admission decisions is hard to gauge. I guess that can vary from one applicant to another, and from one year to another.</p>

<p>So, what you guys are saying is instead of choosing a topnotch FA app over a topnotch FP app as many schools have been able to afford to do in the past for PC reasons, this year the shoe is on the other foot? The schools hardest hit by the financial crisis (most schools) will be fighting over the top notch FP students this year and into the future?</p>

<p>(I'm kidding)</p>

<p>Yes. Full pays will be a more valuable commodity with each passing year, as the economy slips into a deep and brutal winter. It will be worse (or better, depending on your starting point) with each successive year. Eventually, when the US defaults on its debt and the dollar is devalued, the exchange rate will be such that only the Chinese will be able to afford boarding schools in the US.</p>

<p>Most private schools simply don't have the endowment to not favor full paying students. Those with large endowments that have been generous have some tough decisions to face now. </p>

<p>Schools have several categories that they look at:</p>

<p>-Full pay and can donate considerable funds too
-Full pay
-Can pay majority
-Need lots of aid</p>

<p>Traditionally, boarding and private day schools have largely been comprised of the first 2 categories. It's only in recent years that schools have significantly reached out to other groups in their effort to diversify.</p>

<p>Each school, their administrator's and trustee's, will have to determine a workable philosophy for FA in these troubled times.</p>

<p>Of the 4 catergories hmom5 mentions, my guess is the 3rd one - "can pay majority" or the middle class - will most likely get the shaft this year.</p>

<p>I disagree. You can achieve some diversity by "discounting" for the third category, but taking many kids who need over $20K in aid makes your budget dwindle fast.</p>

<p>I think they will raise the bar for applicants who need lots of aid. Categoray 2 and 3 should both increase. Note Category 3 pool is larger than ever, so by increasing this category the school would achieve more diversity too.</p>

<p>I know of a school that sent a letter saying that any student who applied and was accepted to the school with out financial aid, was expected to continue to maintain his/her full pay status for the duration unless there was a dramatic change in the family's ability to pay.
Seemed harsh when spelled out like that.
ZP</p>

<p>Zuzu only a cold-hearted school would turn a 2nd year FA boy or girl away after a full year at FP. If the newly FA child is fully engaged in the school, and the parents' finances pass muster the school will make an effort to accommodate if possible. It is merely a warning to those parents who wish to try a bit of "gamesmanship" with admissions. I'm sure 1040's will be extra scrutinized for that kind of returning student.
Hmom5 what do you consider to be "only in recent years schools have reached out to diversify?" In my experience as a student in the early 7' all the minority students at the school were from inner cities and were on FA. It really accelerated towards the 30% minority/underprivileged goal during the Jimmy Carter years.</p>

<p>Off track for a minute here is a NY Times Archive from 1999 that I'm sure many of you will be interested in considering the economic crisis:
Fannie</a> Mae Eases Credit To Aid Mortgage Lending - The New York Times</p>

<p>The 2003 article where Barney Frank lobbies the Repubs down and talks about how great Fannie and Freddie are:
New</a> Agency Proposed to Oversee Freddie Mac and Fannie Mae - The New York Times</p>

<p>I'll stick with my opinion that full FA students who bring diversity to the school will continue to get the lion's share of the FA pool over partial FA, middle income kids. As Sarum, states above me, many of these schools have a long tradition of bringing in inner city minority students that goes back 35-40 years, easily. They have developed very strong relationships with programs like A Better Chance and Prep for Prep among others and it is unlikely that they will step back from these relationships.</p>

<p>Sarum-Not sure what that article has to do with this thread, but since I hear this argument a lot on entertainment radio (aka conservative talk radio) thought I would provide a different article that talks, in part, about the article you posted. </p>

<p>Jay</a> Hancock's blog: Did the liberals cause the housing bubble? - Economic navigation and sightseeing - baltimoresun.com</p>

<p>Don't get me wrong, I think the schools will continue their committment to ABC, Prep for Prep, etc. I also think they'll keep aid to local day students stable. I wasn't thinking about those kids. Where I think the cut will be is the middle class kids needing $2OK plus. This is the crowd I think schools have reached out to in recent years.</p>

<p>Thanks Emdee, always looking for a fresh perspective. I don't look at it as liberal or political by enlarge, just individuals in power that tried the best they could but really blew it. As our last Prez did... like our new one might if he doesn't figure out fast his mistakes and correct them. The middle class is hurting bad because of this stuff and politically we all know a large middle class makes for a happy country. The middle class can be Obama's ally and are atm if you believe the polls. I think conservatives are defensive at this point as they are being blamed for everything from Katrina to the economic crisis by the Liberal Entertainment radio, Obama's staff, and news pundits. Hancock's blog is more of a Liberal Spin on history and not factual as the historical NY Times Articles I posted. I am as moderate as they come.</p>

<p>Sorry if we're off topic. The posters on this thread are intelligent & savvy and I just thought it a nice deviation from the topic.</p>

<p>More off topic.
WOW! When questioned today who bought and owns all this AIG paper and WON'T re-negotiate with the US government....Bernanke says he won't tell the US Congress who. Swiss banks won't tell Congress who has trillions+ in their banks from the US banking side.
I smell a rat.
I hope these guys didn't go to the HADES schools:)</p>

<p>Lol ya, thats the whole point of having a Swiss bank account. Only rats have swiss bank accounts, if not from the country of course.</p>

<p>I do know that at non-need-blind schools (ie Middlesex) that they pick the first 30 or so applicants that they HAVE to have. Then they look at FA and dole out however much money need to go to those kids. Then they go through the rest of the applicants, keeping in mind FA applicants and how much FA money they have left. So if you're not in the top 30 (more for larger schools like Exeter), FA does come into play.</p>