Middle-class squeeze in affording "match" schools

Parent Cafe
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<p>For middle-class families needing financial aid, are the "match" schools typically the most difficult to afford?</p>

<p>You can afford the "reach" schools -- if your student can get in -- because these richly endowed schools can meet 100% of need.</p>

<p>You can afford the "safety" schools, because your student's above-average credentials earn merit aid there.</p>

<p>But the "match" schools remain financially out of reach. These colleges aren't rich enough to meet 100% of need, yet your student's credentials don't stand out enough to earn major merit aid.</p>

<p>In dd's case, the college sticker prices seemed to vary directly with the level of selectivity. However, after financial aid offers came in, the schools on the top and bottom of her list were far more affordable than those in the middle. Her younger brother has a different set of potential colleges, but the financial aid numbers on the College Board site lead me to expect a similar outcome.</p>

<p>Have others found this to be true?</p>

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You got it right!</p>

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<p>My kid was accepted at the 100% need + need-blind reach schools (except for one impossible reach), and waitlisted at 2 match schools – while accepted to her safeties – so I think there is also an additional barrier to getting in if the college is need-aware in its admissions policies. (I’d note that is something that we did not anticipate and clearly was missed by my d’s high school gc – but for us, at least, there was a happy ending). However, based on that experience I’d say that my d’s reach-heavy application strategy, anchored by a couple of definite safeties, was very wise in hindsight.</p>

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<p>That’s only true for some rare middle class families whose reach schools are tier one universities with excellent financial aid, and whose safeties are schools that have wonderful merit aid. This means that such kids have to have stellar grades and scores.</p>

<p>Ordinary middle class families may find it hard to finance students’ reach schools, too because those kids’ reach schools may be higher gpa/scoring students’ match ones.</p>

<p>Hanging around CC can give one a distorted sense of families’ admissions experiences.</p>

<p>Many middle class families’ reach schools also are in-state publics, which typically don’t guarantee meeting 100% of demonstrated need and certainly don’t have the fabulous financial aid that Harvard now offers.</p>

<p>It’s important to realize that most students’ reach schools aren’t places like Harvard and Princeton.</p>

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<p>It’s also only true for those “middle class” families who actually qualify for financial aid at 100% need schools. What we consider affordable and a reasonable EFC is very different than what the schools consider affordable and a reasonable EFC. 100% need schools that don’t give merit aid are also unaffordable for those of us with absurd EFCs, particularly when home equity is considered an asset and the housing market has gone crazy.</p>

<p>D is going to a school that gave her some merit aid. Not the most that she got, but a nice chunk. 100% of need schools would have given her nothing, no matter how much of a “reach” they were.</p>

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<p>quote:You can afford the “reach” schools – if your student can get in – because these richly endowed schools can meet 100% of need.</p>

<p>I’m laughing and crying. D got into reach school ED, but what they consider need and what we consider need are in 2 universes. Eg, The school expects us to pay >30% of take-home income on tuition., we’d like to pay the mortgage, taxes, insurance, eat once in a while, and pay back college loans for an older child.</p>

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<p>NJ mother’s D’s experience is yet another example of why it’s unwise to apply ED unless finances are no consideration. NJ mother may not like the D’s financial aid offer, but that may not be reason enough for the college to release the D from ED.</p>

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<p>has any one ever defined “middle class” on CC? Because more than income is included for EFC, I think it may be wise to use EFC as the value.</p>

<p>What will be a range of EFC for a CC “middle class”, $15,000 - 35,000/year?</p>

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<p>My experience is at the very lowest end of this range, or the next step down – an EFC of $10,000 to $15,000. That’s the zone where I found the reach and safety schools to be more affordable than the matches. I don’t know whether it holds true for other ranges of EFC.</p>

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<p>After the research we have done - all the online calculators as well as anecdotal evidence from parents of D’s friends - that would seem to be the case for us, which is why we are trying to convince our D to push her hook if she really wants to try her reaches…I think in our case, if we go with the match, it would be at the expense of not being able to help with graduate school expenses since second D will be in college by then. Try getting that through to a 16 year old…</p>

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<p>So if your EFC is 10-15K it will be less expensive to attend a reach vs. a match? Can anyone give an example where they found a reach school was LESS expensive than a match. I know our neighbor’s D got into Williams as her reach, she got into Holy Cross as her match. Her parent’s make 150K… which I think put thier EFC around 10K or less. Williams, the reach, offered almost nothing but Holy Cross gave her 2/3 tuition via a merit scholarship. I’ve read here that if your income is between 80K-160K, at least prior to Harvard’s new initiative, you would get so little aid, merit or otherwise, that many of the elite reaches, (ranging from Ivy to say a Colby or other top fifty) would be unaffordable to most folks in that income range. That being the case folks in the 80-160K range grab the match, or the safety, with the merit offer as incentive. In the alternative you pay full tuition at say, Princeton, as another neighbor did, lose that nice 100K plus job, and find yourself in bankruptcy.</p>

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<p>Nightengale, your neighbor’s example illustrates how a student need not compromise greatly to make college quite affordable for many families. Our son did the same, forgoing the likes of Cornell and JHU in lieu of Case, Oberlin and Rensselaer. Students do not have to go far down the academic selectivity food chain to be competetive for merit aid and sacrafice little in academic quality either.</p>

<p>I also do not know why FAFSA formulae do not take regional cost of living differences into consideration. It would be easy to make such an adjustment and be much fairer to families and students.</p>

<p>Finally, college affordability need not be such a big issue for many families if they began a college savings plan as soon as their child was born. I have little sympathy for families who live above their means, save little and then expect a big hand need based handout when their child reaches college age.</p>

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<p>I doubt the EFC on 150K of income is 10K, unless they have 15 kids or something else quite unusual.</p>

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<p>With a salary of 150K, you’re probably talking about an EFC of about 40-45K, even without a whole lot of assets (based on FAFSA only). That’s why Williams offered almost nothing - it’s all need-based, and according to Williams (using both FAFSA and institutional methodology, which usually gives a higher EFC), she had no need. Williams does not give merit aid.</p>

<p>Holy Cross gave her merit aid, not need-based.</p>

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<p>NJ_mother, did your D applying any other EA or rolling school? If the other school gives you better FA package already. Is it sufficient to withdraw from the ED? Or you can call the ED’s FA office explain your situation, they might match up a little more? In most of those info sessions from ‘need-based’ school, all FA officer say don’t hesited give us a call, even you are in ED, if you feel uncomfortable with your FA. In one of these sessions one even given an example just like you.</p>

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<p>Chedva, based on my own four year experience with Tufts University (only need based aid) your assessment is as accurate as it can be.</p>

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<p>AnotherNJmom, D didn’t apply to another school; H is calling school today to go over CSS with FA officer. We’ll see what happens. We can manage the first year by spending out her entire 529 plan without extra loans; she already has a summer job lined up at $8.50/hr.</p>

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Contact the school’s financial aid office and make sure they are aware of the loan payments you are making for the older kid – I had my d’s grant increased by a few hundred dollars this year by providing evidence of the PLUS loan statements for the older brother. (My loan payments are relatively low on that, since my son so kindly dropped out of his high priced college after 2 years --about $1200 a year – so basically they subtracted the total payments from income and recalculated the EFC). </p>

<p>That being said, the 30% mark is pretty typical (actually better than many families face – I think my EFC is around 42% of my net income) – they do assume that the family will borrow – so it is probably something that could have been anticipated with various online calculators – and your post simply illustrates once again why families who have a need to weigh and consider financial aid awards should not bind themselves with an ED application.</p>

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Thank you for that post – I think that indeed it is a good measure – and while my personal assumption would be more like range would of $10-30K - your suggestion goes far to address the claims of people who self-describe as “middle class” but have high EFC because their income and/or assets are well within the top 10%, and probably top 5%, of the nation.</p>

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I know it is frustrating when you can’t afford the EFC and do not seem to have much income left over after paying all your expensess, but if you don’t qualify for any aid whatsoever at a 100% need school with annual COA about $45K… then you really aren’t “middle class”. Your lifestyle may seem middle class to you, but your accumulated assets and/or income means that you are better off than the vast majority of people who live in this country. Yes it is frustrating to have home equity counted when you can’t spend a house – but equity is an accumulated asset - something that can be borrowed against and, more important, something that renters do not have to fall back on. </p>

<p>I am in a similar situation – I think my home adds about $12K to my EFC – but the fact is that I do have a stronger financial picture and more options because of my home equity. For example, I think I will need less in retirement because I will be able to pay off the home by the time I reach retirement age – giving me the option of either living rent free or selling the home and cashing out its value. Or I could move to a smaller, cheap apartment and rent out the home to keep a good flow of income. If I had the same income without the home – I simply would not have the same long term options. </p>

<p>I looked at college borrowing for my kids in terms of my own net worth, including the home – so even if I borrow a lot, my net worth is still very safely in the positive range. For me, that means the borrowing is not too risky – in a worst-case-scenario I could pay off all debt with proceeds from sale of the home. I wouldn’t want to do that, of course – but I wouldn’t be bankrupt. </p>

<p>However, even with that large asset, I do qualify for a lot of financial aid because I only earn about $50K… so it is very difficult for me and others in my situation to hear people with 6 figure incomes complain about being “middle class” and not being able to afford college. Whatever your “class” is, it is a lot higher up the income ladder than mine – and I certainly do NOT consider myself poor or lower class – nor does the college that sets my EFC in the ~$20K range. (FAFSA EFC is around $8K – but as noted, I’ve got that home equity added to the equation). </p>

<p>Ask yourself this: what would the EFC be without the home equity? Would you be happy to give up your home in exchange for that EFC, assuming full grant aid to make up the difference? I know that for me that would be quite a joke – of course I would never want to give up a 6 figure, growing home equity to save $12K or even $20K in annual tuition – in the short term I feel the pinch, in the long term I am essentially living atop a gold mine, given my income. </p>

<p>So yes – it is tough for me and tough for you to pay for college – but I wouldn’t want to trade places with a -0- EFC family, and you probably wouldn’t want to trade places with me, for my $20K reach-school EFC, at least not after you saw my house with 20-year-old carpeting and ratty old livingroom furniture. (I’ll redecorate after daughter graduates from college! - right now its tough enough to keep up with necessary maintenance). </p>

<p>However we define “middle class” – lets keep in mind that the people who qualify for more aid by definition have much smaller incomes and nest eggs than the people who qualify for little or no aid.</p>