I have heard that a wealthier applicant pool applies ED because with binding applications, colleges have less of an incentive to provide comfortable financial aid; however, most schools also say that ED can be nullified if the applicant cites financial reasons for not attending, and, as I understand it, it is the applicant who decides whether the aid is to their standards or not.
So then, if ED is binding only to the extent at which the applicant THINKS it is worth affording, is it really biased towards the wealthy? As in could I apply ED to a school which I am not sure I can afford without generous aid and then opt out if accepted with mediocre aid and apply to other schools EA/RD? (I am considering EDing at either Columbia or Brown)
@kingofcats, I would run each school’s net price calculator (NPC), for which you will need income/asset information from your parents. If the expected family contribution (EFC) shown is unaffordable for your family, then I would NOT apply ED to that school. Don’t give up…just look for schools that have an EFC more in line with what your family can afford. If you do apply ED and the school offers you FA in line with what is quoted to you on their NPC, then you cannot in good faith back out of your agreement to attend. Rather, do research on the front end. Also, look for financial safety schools that you know you can afford. There are even schools that give tuition scholarships for good ACT scores to everyone that applies with those scores. Check out Univ. of Alabama, Mississippi, Oklahoma and more that you can find on other CC threads. Good luck!
Edit: By the way, I do agree that wealthier families are able to apply ED with less trouble/concern than less wealthy families.
I don’t think it has been documented that FinAid packages are deliberately lower in the ED round. The main thing is that applicants can’t compare FinAid offers from different schools, therefore, students for whom FinAid is crucial may tend to not apply ED.
I think research has borne this out, but not sure. Other reasons ED slants toward wealthier students is that they are generally better prepared and knowledgeable enough to apply early, have their perfect SAT scores and subject tests done early, etc.
I believe for any individual, you could apply ED (run the NPC to get an idea of FinAid, if it is reliable in your family’s situation) and then withdraw if you find the aid insufficient. I don’t know how big of a deal it is to decline the admission or how long it takes, if they require any substantiation, etc.
NO, because you would have to make a decision and withdraw applications from other schools before you see their aid package.
You generally have 2-3 weeks after ED acceptance in December to either accept your spot or ask to be released from the commitment due to affordability concerns.
EA schools will usually not provide financial aid packages until later, and of course with RD you would not get your aid package until after notification of admission in the spring.
That being said, the Ivies generally have better need based aid than any other college, so if your ED is to Columbia or Brown, it’s highly unlikely that any other college will offer you more in need-based aid. On the other hand, if you are qualified for admission at Columbia or Brown, you probably would also qualify for substantial merit based aid elsewhere.
Columbia generally gives better aid than Brown, but both are terrific. And if you qualify for need based aid at Columbia or Brown, their need based offers are often far better than merit offers elsewhere.
ED is just one tool that the schools use to help maintain a healthy mix of full-pay vs.needy students. There are certainly some needy students who can run the NPCs and decide that they will be able to afford an ED school - especially those at the very low end of the income scale who will get a full ride. For most needy families, though, the importance of comparing actual offers - which can vary by a few thousand -is critical. The fact is that a few thousand dollars generally means heckuva lot more to a family earning $70K than to a family earning $300K.
Your ED school should provided your financial aid offer letter with your acceptance letter if you have submitted all required FAFSA / CSS Profile / IDOC information. You do not have to accept the ED blind to the financial aid the ED school is offering and they understand that.
ED is biased toward the wealthy because it is only a good idea for those who can either pay full price or are reasonably confident they will get sufficient financial aid. (In a way, it may be a little biased also toward families with little money who apply to schools with great financial aid for low-income students.)
My D is a senior who considered applying to a school ED. I told her it would only have been OK for her to apply ED to a school that meets full need without any loans in the package. (And there are only 15-20 schools like this.) That way, if the package is, say, $5000 short of what was hoped then the difference could be made up in loans. If, on the other hand, there was already a $5500 loan in the package and we couldn’t come up with what the college thought we could, then there would be nothing to do other than even more borrowing.
According to what I’ve read, Columbia doesn’t include loans in the package for anybody, while Brown may for those with family incomes above $100K. So you should definitely check each school’s current policy and run the NPCs before applying ED anywhere.
Some schools only meet full need for all ED applicants…and not regular decision ones. I believe Carnegie Mellon meets need for all accepted ED students… but not regular decision accepted students.
The thing about ED is that it will be all or nothing. IOW you get that one shot at your 1st choice and if they don’t come through with enough FA then you have to reject them and go with the school (most likely public in state school) that gives you the most money.
Generally speaking yes. However, if you can’t afford what the NPC says you will get, then I don’t think it’s a good idea because it’s a real hassle to get out of the ED, and you are unlikely to get more elsewhere unless they tack on some merit. However, if the NPC results work for you, then I say by all means, feel free to apply ED.
The problem is that there is no way to know what other schools will offer at the time the decision is required for the ED school.
Colleges that say they meed full need do NOT meet FAFSA EFC. They use their own formulas to calculate “need” and that can vary considerably. In my case, reviewing RD packages over two admission cycles, there was a $10K variance in need-based awards within each cycle.
Whether a college promises to meet full need without loans is immaterial, because if college A. decides that the family should pay $20K, and meets that need with a combination of grants and a $3500 loan, and college B decides that the family should pay $30K, which is fully met with grant aid — the family is still being asked to pay more at the college that did not require loans in the package. The difference in the college’s loan policy doesn’t make up for the difference in determination of need.
The NPC calculators are ballpark figures only; there can be considerable variance between results and actual packages.
Some factors which impact the determination of need are:
Home equity on primary residence
Parent self-employed
Weight given to income & assets when parents are divorced / never married (NCP situation), and where parents have remarried (step-parent income/assets)
Multiple kids in college
Factors which may be considered in the exercise of professional judgment
If parents cannot compare awards – then the end result might be:
(a) Parents and student accept the award and end up taking on thousands of dollars of extra, unnecessary debt for college, carrying that burden for many years post-graduation.
(b) Parents and student turn down ED spot, only to learn later that no other college offers better aid, meaning that the parents/student end up paying more money for a less-desired college.
So it is a gamble, and potentially a very expensive one, for middle class families who cannot be sure of the amount of need based aid they will qualify for at the time of applying.
The problem is that without having a basis for comparison, it is difficult to know whether an aid package is “generous” or “mediocre.”
@thumper1 - in my view, given the uncertainties of how a college defines “need”, any colleges that follow the practice you’ve outlined are being particularly predatory — as it is a practice specifically designed to put added pressure on financially needy applicants to apply and potentially lock themselves in without the opportunity to compare awards.
Many colleges in the RD round will review their own awards and potentially match offerings from peer schools. So it obviously saves the colleges money out of their financial aid budgets to accept students who won’t ever get to that step.
It’s not a problem if you are willing to pay what is offered. That’s what most people do, even people of low income. If it’s less than equal to the NPC forecast than it’s what you expected anyway. I have a relative with a very low income who got a near full ride to an Ivy ED.
If the NPC forecast is insufficient, I agree it’s a bad idea.
If you are shopping colleges on price, I agree with calmom, you can’t guarantee the best deal.
@calmom I’m not saying I agree with CMU policy… but it is what it is.
There are also schools that meet full need for kids innthe ED and RD rounds but not off the waitlist.
I personally think schools should do away with ED altogether. This is especially true now when use of prior prior tax year on the financial,aid forms…and the October ability to file for financial aid…have come into play.
But I guess some schools like to have an early lock on admitted students.
The big issue is supposedly there is no way for ED admitted students to compare financial aid awards… it this year, some schools sent those out before some ED acceptance were sent.
And ED2? I think that really should be eliminated.
If a school wants early applications…do early action…which is not binding.
@alooknac wrote in post #2, above: “I don’t think it has been documented that FinAid packages are deliberately lower in the ED round.”
You may be correct, @alooknac, with regard to financial aid being handed out in an even-handed fashion between ED and RD. I am not sure that it has been documented either way.
However, I do think it is pretty well understood that applying ED is likely to undercut efforts to receive non-need based merit awards. There are schools that do give merit awards on a need blind basis. Families that know they won’t receive need-based FA after running the net price calculator may target merit and may therefore choose not to apply ED. Some would consider families that don’t qualify for need-based FA to be “wealthy.” Others call them to be “donut” or “donut hole” families, I guess because they miss out on need-based aid but cannot comfortably foot a $70,000 annual cost of education per kid.
Given this analysis, I would modify my post #1, above, to tell the OP that yes, I agree that ED favors the EXTREMELY wealthy, those for which cost truly does not matter because such families need not worry about finding merit aid, but at the same time ED may serve those with financial need that have targeted schools likely to fully meet that need with grants (not loans). Thus, @ClassicRockerDad’s relative qualified for great FA from an Ivy. However, ED does not well serve families that can expect no FA but are not wealthy enough to comfortably pay for the very high cost of education today.