It’s possible for wealthy people to legitimately qualify for a Pell grant; a typical example would be business owners who have losses. There is an industry term for it, “Pellionaires.” But the CSS should catch and prevent such people from getting aid at a selective need-blind school.
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For fraud, yes. But there are a lot of things in the tax code which are not obvious, which people might be missing. I already gave examples of things I’m aware of, which on the face of it seem unethical, but which are legal. So my question is, what else am I missing?
Everyone keeps asking “what would that be” but my point is, I don’t know, I’m asking this group.
How can people “just follow the rules” if they don’t know what the rules are?
How far does the $7k/year of a Pell grant go? Pellionaires? Pellseventhousandaires!
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This is, I guess, an analogy. The other day I took a NYC Transit bus home from the subway. The bus was almost empty. A passenger arrived at his stop and engaged in a conversation with the driver (while I waited, waited, waited for him to leave the bus so I could go two more stops and be home already!). He asked the driver what were the consequences of not paying the bus fare, that he saw people not pay their fare all the time and getting away with it, and why shouldn’t he do the same. Now, what was the bus driver supposed to say? I was really tired (which is why I had waited for the bus in the first place, exiting the subway at a station with an elevator to avoid the 50 or so steps to get out of the subway at the stop closest to my house) and I wanted to go home. So finally after listening to this nonsense for what seemed like many minutes, I asked the guy if he would just stop so the bus could go on to my stop. He told me to mind my own business and when he was finally done with haranguing the driver and he got off, he cursed at me.
Mind you, this guy looked like he was over 65 years old, so he had a half-fare metrocard just like me and could take the subway or the bus, or the subway and a bus within two hours of paying the first fare (or two different buses) for $1.35.
Sure there are parents who game the system as much as they can. Most of us, I think I can safely say, would not want to set that kind of example to their kids, if nothing else, to say nothing of the possibility of getting caught. Likewise the guy on the bus. I like to think we participate in a civil society and may not always like paying too much or or seeing others cheat or believing that others get away with stuff. But by and large, it feels a lot better to do the right thing.
Sorry for the very long and tedious story, but, having read the original linked article (and, sorry, I don’t have any gift articles left for my NY Times subscription), the guy on the bus made me think of the Ethicist article.
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That is not the impression that I got. I understand exactly what you were asking - whether you were “stupid” for NOT cheating. It was also obviously a rhetorical question and you were mostly venting.
You should have included a link to the article - things may have been a lot clearer.
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This is a piece by Ron Lieber on merit aid.
Besides the school’s net price calculator another resource to learn about a school’s financial awards given in the past is to review the net price paid by different income brackets by using College Navigator.
In the end though, average doesn’t matter. What will matter is what you are asked to pay and unfortunately at many colleges you just won’t know until after your student has applied and been accepted.
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Let’s get a few things out of the way first.
- How old are your kids? When will they attend college?
- How much can you realistically pay for their college each year? This should include savings, gifts, cash flow, work BUT NOT LOANS AND SCHOLARSHIPS. In other words, what is the budget?
- What majors are they interested in? Location? Type/s of school?
Based on these, I am sure we can offer better suggestions.
I will tell you my personal story. We saved a certain amount each month for 13 years for each kid starting at the time when they entered kindergarten to have enough in their 529 accounts to fully pay for in state cost of attendance. That amount is ~$80K per child here in NC. Actually, it is a bit less but lets say between $150-160K. This was all done on 1 income (mine) while making tremendous sacrifices. I made very clear to them that this was for their education and they had to show the desire to attend a college and show progress once they got there. We were not going to sign any loans in our names. If they wanted to attend a non-state or private school, they had to figure out the finances. In other words, setting limits and boundaries. I suggest you do the same.
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This is why some people use a GOOD tax preparer…who should be knowledgable about what is and isn’t allowed.
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I think that most people do just pay. However, just like the tax system, the financial aid system has some holes. I have no doubt that there are people jumping through hoops to take advantage of anything that they can. That is human nature. I don’t worry too much about it. What concerns me more is when a system disadvantages people that are already at a disadvantage.
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This. Yes, it’s hard when you don’t know what that will be until after application and acceptance. However, I’d be curious to hear ideas about how this could be remedied. I don’t know of any myself, but maybe I am not thinking creatively by virtue of having worked in the system.
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I like Lieber’s work a lot, and I understand some families enjoy or have no choice but to merit-chase, but I think he downplays the amount of stress it can create, and is overstating the value of what random parents wrote down on a spreadsheet. Kids with the exact same stats and finances can get wildly different offers in the same year just based on when their app hits the desk.
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An interesting variant on the NYT scenario is that another way to be independent for financial aid purposes (and potentially get instate rates at OOS colleges) is to get married. And it’s completely legal.
It’s sufficiently common to pop up in occasional press articles eg Til debt do us part: UC Berkeley students are getting married to save thousands in tuition
If your college kid came to you and said “I’m getting married to save on the cost of tuition”, what would your reaction be?
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Back in the USSR, kids would get married so that they would qualify for their own place. Most people I knew from the USSR were on their second or third marriage, and the first one was when they were 19 or so.
Of course, one of the good things about the USSR was that they believed in no-fault divorce long before any other country. One of the bad things was how difficult it was to get a place of your own, even to rent.
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Kids are 8th and 10th, current savings is about $100k in two 529s (the little one’s went higher because it is in a riskier account which paradoxically has done better, but I’m planning on re-balancing their accounts when 10th grader is in 11th grade to lock that in).
Older kid has straight As, two jobs, and volunteers and wants to do engineering or something technical and has her eyes on the Cal State or UC system (we are in WA) with a stretch goal of an Ivy League with a “why not try” attitude.
The other one would like to study history with an emphasis on gender and race theory in the south of France “or maybe Switzerland”. (I wish to god I were making that up as a joke but I’m not… did I mention she also hates French class? LOL.) She doesn’t want to be a librarian because “the pay isn’t good.” Anyway, we have some work to do there.
I’m not too worried about paying as we have saved and continue to save. I’m worried that if people think that putting all your money in a big obvious “this is for college” account is stupid, that my kids will be disadvantaged because colleges will look at them as not rich enough to help the endowment but too rich to meet their socio-economic diversity criteria or whatever.
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Well believe me I wish I’d have known that when I was literally bean counting in college. 
I’m not opposed morally* but that’s why we save money, so they don’t have to do that.
I think what I have learned from this thread is that commenters on the NYTimes article who claim that “everyone does it” are either:
- Lying
- Criminals
- Stupid people with stupid plans
There’s no “trick” that those commenters seem to be so confidently alluding to. That makes me feel better.
*Edit: In my view, marriage as a legal arrangement is first and foremost a legal and financial agreement, and we’re not religious, so that’s all it is for me. People get married for health care all the time. Even religious people get married for the legal protections. Otherwise they could just make their religious vows. So yeah, no issue withthat.
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Stop worrying. You are better off saving in a college fund than not. Tune out those who try to tell you otherwise.
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CSUs and UCs do not offer need-based financial aid to non-California residents. UCs are quite expensive for non-California residents (CSUs a bit less so). Some of the less popular campuses offer discounted WUE tuition. Note that many CSUs are heavily commuter campuses.
In Washington, is she not interested in UW or WSU?
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I think there is a lot to learn about college admissions and you are in the right place to do so. First, please allow me to point you to a few resources (internal to CC and external):
- Podcasts: Your College Bound Kid. This week’s episode is on 75 hardest colleges to get into. Host is AA and brings a ton of information to the table. In fact, if you can afford it, working with a consultant could be a great idea (although not a cheap one.)
https://yourcollegeboundkid.com/
Another one I really like is Admissions Beat from Dartmouth, although this one has a more noble tone about it. Admissions Beat Podcast | Dartmouth Admissions
Find the episodes you like and go from there.
I learned a whole lot from these two podcasts. - Internal resources here. First, paging the college selection oracle @AustenNut. I cannot emphasize the importance of a balanced list and this takes work. AustenNut is also AA/biracial and can provide some unique insights. Your list for kid #1 is unrealistic to put it bluntly. And it appears your kids will require $$ beyond what you have saved and can provide if avoiding loans is important. I am also paging some other AA parents whose kids have done really well in recent years based on my memory but apologies in advance for some oops moments here. @Dolemite @EconPop @UCDProf I think UCDProf’s son just got into Cornell engineering.
One last thing, generally speaking, at least for engineering, college brand is secondary to ABET accreditation and outcomes. But some majors are harder to get into. Go to the ABET page to find accredited colleges. Finally, do not get sucked into the prestige game. Instead focus on outcomes. Use this government resource to research outcomes: https://collegescorecard.ed.gov/
Anything else, just ask.
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Definitely not WSU. It’s a great school but if you don’t want to live in Pullman or join a frat, the culture is going to be really challenging to deal with. It’s an hour and a half from Spokane. Again, absolutely no shade on the quality of the school’s academics but the culture is very specific. I know multiple kids who dropped out after a semester or a year.
UW is a good and on the list but not a safety, especially for aspiring engineers. I know more than one kid with a 3.9+ unweighted, volunteering, 4 years of a sport, blah blah who were rejected. Washington State residents.
I know California is expensive but as you point out they have a lot of campuses. We wouldn’t get need-based aid anyway. That’s why I’m saving as much as I can.
Don’t dismiss Western especially if the kid is interested in life sciences. Some bigger biotechs in the area recruit there.
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