The super selective private schools that are focused on in these forums typically have about half of the students with no FA. Of those with FA, typically only about a quarter to a third are on Pell grants (below median income). So there are still lots of students from upper half income families that are not in the top 3% or so, although the top 3% is the best represented.
just to support my thesis that the so-called donut hole is self-imposed??? 
If you have to spend $280K for a top school then hopefully your wealthy enough that it doesnât matter. So we know that those making between 200 - 300K are going to feel the pain. Less than that and I you start to approach numbers like in state tuition at your public flagship. I am lucky in that I am in the donut, but between FA, scholarships and my D contributions (she works during school and internships), I will pay about 100K for her to attend Uchicago. Personally, I wouldnât pay anything above in state tuition for any private school that is outside the top 20.
@stepl100: Our experience is exactly that Top Tier stats come with scholarships for highly ranked (not top 20) schools trying to entice donut hole full pay students. Not surprisingly, they usually reduce a $65K university bill to $35 or $40K. The first time I read about the extra perks of funding for overseas travel, summer experience funding, city excursions, I laughed a bit at the marketing tactics. Some schools award these merit scholarships need blind (which we all know is not need blind due to the wealth of information included in an application) but most require the CSS and FAFSA for merit aid consideration. Students without the high stats often choose in-state or OOS public schools to meet the same budget. Sometimes it is harder to complete a degree in 4 years due to scheduling, something private schools seem to be better at and I assume that low tuition cost is an additional driving factor for in-state students taking lighter course loads.
So, the real question a parent needs to answer is: Do I let a talented student apply to a top 20 meets full need school? Rolling the dice, if they get in, how do I explain that even though they worked very hard and desire to spend four years with equally talented peers, their family situation is not equivalent to either the wealthy or the many students who get generous aid. Itâs honestly counter intuitive to what most of us teach - work hard, keep your marriage healthy and compromise often because divorce is easier but expensive, pay off your home, save for college⊠Unhooked donut hole students often have exceptional talent. Those public school students many not have been as well prepared with incredibly advanced coursework from the super elite private schools and they do not struggle with the same transition as first generation students, but Iâm told that generally they arrive at a university with drive and self developed learning skills and often thrive to be at the top of the class.
Most donut hole parents are not inherently financial risk takers, we watched our children struggle through K-9 or K-12 being bored. A guidance counselor sat us down early in HS, explained the crazy ED/EA/RD application process and shared that in many states the flagship (ours) would be similar to a high school experience for our child. We ignored the test prep and college counseling craze, did not count AP courses and encouraged our children to socialize and spend time with their sports team.
"We ignored the test prep and college counseling craze, did not count AP courses and encouraged our children to socialize and spend time with their sports team. "
Though AP credit could mean cost savings as well.
If youâve waited until they were 18 to have that talkâŠ
And there it is. The so-called donut hole is that you want something that you cannot afford. No different that wanting a fancy car that you canât afford.
âAnd there it is. The so-called donut hole is that you want something that you cannot afford. No different that wanting a fancy car that you canât afford.â
Not quite. There isnât a âdonut holeâ for Jaguars. Because they donât give out financial aid for Jags.
Fancy private colleges have a donut hole because I canât afford it, but some people with less money than me can. With Jaguars, only the people with more money than me can afford it.
And of course, weâd need to point out how long the odds are for the poor kid to actually get into Harvard. While the private college donut hole is obviously a first world problem, that doesnât mean it doesnât exist.
1 Like
@PurpleTitan At most top 20 schools, students have all taken AP/IB classes so the starting point is different. AB Calc is often a prerequisite and at MIT students without BC are caught up over winter break. All have a math entrance exam so students are placed in the correct class with/without an AP score. Chemistry is taught much more in depth, put the book aside any pay attention in class because information is new and mathematical based. Most schools do not transfer biology, nothing will get you out of general writing requirements or history. Physics, is a maybe, but for a STEM major it needs to have been very well taught in HS. I was surprised for our oldest and am now realizing that I need to pay $400 for the May AP exams and they will merely gain our senior his earned GPA.
MIT AP credit: http://uaap.mit.edu/first-year-mit/first-year-academics/incomingcredit/previous-study/ap-and-transfer-credit-advanced-placement
Note that MITâs first calculus course, 18.01, is accelerated so that one semester covers what is two semesters at most other colleges. See http://math.mit.edu/academics/undergrad/first/calculus.php . 18.01 technically requires only high school algebra and trigonometry as prerequisites, but calculus in high school is recommended for students seeking admission to MIT (and there are probably many students in 18.01 who have had calculus in high school but did not score high enough on AP or other math placement testing).
Are there schools where (income - cost of attendance) increases if you make less money? I think the issue is that people with less money live a lifestyle where they can survive on less money. But anyone who makes more money can live that lifestyle also. Like, I donât think we should envy people that are so poor that their need based aid covers the entire cost of attendance. Yes they get to go to college for free, but they are also missing out on so much just because their familyâs income is so low in the first place.
@bluebayou âAnd there it is. The so-called donut hole is that you want something that you cannot afford. No different that wanting a fancy car that you canât afford.â
Actually did not wait past elementary school, well planned and could afford with planned sacrifice including home maintenance, fixing older cars, paying off home. No project too tough to tackle⊠Often, life does not work out the way you planâŠnot everyone is blessed to live long enough to watch their children graduateâŠexplaining that horrible reality and the unfairness of healthcare and financial aidâŠmany tough conversations to start with children at ages 12-18. Real life has one foot on a well planned course and the other on a banana peel,
Back to the OPs question. Is $280k for an undergraduate degree worth it?
Before comparing it to a less expensive alternative, it may be helpful to first try to understand the value vs. not going to college, and the assess it vs. less expensive options.
The expected financial value of college is higher when:
- The student is relatively advanced when they begin college. (kid w 35 ACT gets more value than kid w 15 ACT)
- The student chooses a major that has strong expected placement, solid expected pay, and adaptability.
- The studentâs odds of successfully graduating are higher. (school grad rate, student GPA, etc.)
Non-financial value:
*College often impacts the spouse you end up with. College-educated people tend to marry other college-educated people. Elite college grads tend to marry other elite college grads.
College-educated people also pass many things they have learned to their children that improve their childrenâs odds.
The point UCB is that studnet whose families that make too much to get meaningful financial aid but not enough to be full pay arenât able to go to those schools, leaving out that demographic. While the Ivies have no loan policies and give aid to families pretty far up the income ladder, many of the other privates do not. Many schools that use CSS profile offer almost nothing to families that have some home equity. This is particularly true at those schools that are in the rank below the super selective schools that do not give merit but do not give financial aid at a much lower income level than the Ivies.
I would expect this would vary by state as different states have different in-state tuition levels and strength of in-state publics. And how about school #21? There is a cliff between #20 and #21? And which ranking should be used?
Personally I use USNWR but everyone has different goals/aspirations, so they can use whatever ranking they want, and no, top 20 isnât hard and fast. I feel that USNWR is the most transparent in their criteria and I donât trust any ranking that isnât totally transparent (and most are not). In state flag ship universities usually run around 30K per year plus or minus cost of living adjustments so there is a figure for you.
BTW goals for my children are the best possible education (lot of personal factors here), with the best possible cohort, at a price I can afford.
CU- I donât disagree with your criteria, but what do you when kid number one is interested in aero/astro engineering, kid two is interested in musical theater, and kid three wants to teach first grade?
Just curious how you navigate kids with different interests where USNWR isnât terribly helpful.
Much2learn are you arguing that the expensive private school gives a better life outcome than a flagship state university? In many states, that may not be the case. Many very smart, capable kids end up at the honors college at Big State U for financial reasons but do very well.
Are you also saying that a kid that wants to be an english or sociology major should not waste their $280K? Not sure the major (except that engineers should go to a school with engineering) should matter.
It wasnât a direct relationship or formal calculation, but for me definitely the major the kid wanted to pursue mattered for how much I was willing to spend on college. Probably because I grew up poor and view college as a means to an end rather than an âexperienceâ, but I do think of it as primarily an investment. And part of how much Iâm willing to spend on that investment is related to the expected earnings after college. Of course kids change their mind and thatâs always part of the consideration. On the other hand, if I had a child that was planning to go into a field making $30k a year, then I would be more inclined towards the free in-state college options rather than an out of state private school.
DH and I have done well for ourselves with our basic college education, but weâre not so far removed from poverty that we are at the point where we would be willing to spend $250k (which meant we had to earn $500k pre-tax) for an âexperienceâ for either kid. Itâs just not how we view college.
If my kidâs dream is to be a ______ (insert field that earns a small income), then I will fully support him emotionally and help him understand the lifestyle choices heâll need to make to be self-sufficient on that income. Iâll love him and be proud of him. But I wonât be sending him to a college costing $250k. Iâll be sending him to the free state option.
âI think the issue is that people with less money live a lifestyle where they can survive on less money. But anyone who makes more money can live that lifestyle also.â
I really donât think this is a great argument, although it is literally true.
Sure a $200k a year accountant could easily afford to full pay for two or three kids â since the accountant could choose to live as if he only made $80k and save all the rest. Or he could choose to live on $60k. Or even $30k â since some families have to do that! And if you commit to live like a $30k-er (pretty much poverty level for a family of four), then you really donât need to save very much for retirement. So youâll have more money than youâll know what to do with. Youâre the multi-millionaire living next door â in the 'hood!!
But come on. Even extremely frugal people donât actually do that in reality.
Letâs take a look at what youâd face trying to send one kid to Harvard (which has the most financial aid allocated to higher incomes). Most schools would not be nearly as generous.
$65k income â $0. 0% of family income.
$100k income â $5k. 5% of family income.
$150k income â $15k. 10% of family income.
$275k income â $70k. 25% of family income.
$500k income â $70k. 14% of family income.
$750k income â $70k. 9% of family income.
$1,500 income â $70k. 5% of family income.
The system is progressive to a point, but then becomes regressive. Hence the donut hole. Fancy cars donât work that way.
1 Like
â$149k as âtypical lower or middle incomeâ is stretching it quite a bit, as it is around the 86th percentile.â
We are talking about college. Completely accurate statement in that context.
At a top 20 private college, the median income is 90th percentile (or higher). WashU median is $272k!!
At the well-endowed, full-need meeting privates, 86th percentile probably gets some need-based financial aid. If you are in a situation where you are deemed âfinancially needyâ, it isnât a stretch at all to say you are middle income or lower.