<p>Tell me if I'm missing something here, but I think a lot of schools could do what Harvard's doing with their financial aid program. (The main point being that families making $120K to $180K are only expected to pay ~10% of their income). </p>
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The enhanced aid packages will initially cost about $22 million annually, the University estimated, increasing the grant-aid budget from $98 million this year to nearly $120 million in the 2008-2009 academic year (about 22 percent).
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<p>I know Harvard's the most endowed university by far, but let's just take a look at Cornell as an example. </p>
<p>$120 million is only a little over 10% of that, and that's the amount that Cornell's endowment increased. That's not how much they made on their investments; that's how much their endowment actually went up. </p>
<p>By the way, both universities have roughly the same amount of total students, so I think this is a reasonable comparison.</p>
<p>Well, for starters on Cornell: Cornell's new financial aid initiative will be implemented over the next two years. In the first year, 2008-09, the university will eliminate need-based loans going forward for undergraduate students from families with incomes under $60,000, and cap them annually at $3,000 for students from families with incomes between $60,000 and $120,000. The following year, 2009-10, the program will take full effect by eliminating need-based loans for students from families with incomes up to $75,000, and capping annual loans at $3,000 for students from families with income between $75,000 and $120,000.</p>
<p>The university expects to spend $116.8 million of its own resources on undergraduate financial aid in 2007-08, 94 percent of which will be spent on grant aid. More than 60 percent of Cornell's undergraduates receive some form of financial aid. Cornell has a greater number and a higher percentage than most of its peers of Pell grant recipients -- students from families that have annual incomes below $45,000. For fall 2007, Cornell enrolled 1,799 Pell grant recipients, representing 13.3 percent of its undergraduate student body.</p>
<p>And it is all tied to endowment. When you are the richest you can afford to give more away. What happens to a smaller college when the endowment goes DOWN as will probably happen this year? That is why only select colleges can step up to paying for a greater share of the bill.</p>
<p>Is it just me or are we surrounded by funny math? Like gas prices are way up, oil companies have record profits but they say - and we're supposed to believe j- that they're not just plain and simple overcharging? The schools whose endowments are going up so dramatically - they may not be overcharging per se, but wouldn't it be nice if they would at least freeze tuition hikes for a year just to share their good fortune with the whole school community?</p>
<p>Main problem with Cornell: very high (relative to peers) "self-help" figured into the financial aid packages. Cornell's standard is $12K self-help, which means they include about $6K private loans in every financial aid package, while Cornell's peers typically set self-help limit to $6K (work-study + Stafford). To characterize private loans as "financial aid" is rather misleading, but College Board, Peterson's, and US News & World Report don't challenge Cornell's claim to meet 100% of demonstrated need. Result is that the grant portion of Cornell's finaid package was less than 1/2 the amount offered to my daughter from every other school (including some with endowments that are a fraction of Cornell's).</p>