<p>My father is convinced that the full-pay families are paying for both their own child and someone else’s scholarship. He points to the fact that what he paid for all four years of college for me (COA, not just tuition) is now less than the COA for one year at the same school, 25 years later. Meanwhile my salary (I do approximately what he did) is about twice his. He is infuriated by this. I’m…resigned to it. Do you think there is anything to what he says? Are colleges funding their socioeconomic diversification by transferring costs to the families who don’t qualify for aid?</p>
<p>Nothing costs what it did 30 years ago. My tuition room and board was about 7500-8000 a year. So… </p>
<p>Bovertine - son filled out the common application and there was a box on every general page that asked that you check the box whether or not you were applying for financial aid. Other than that (and perhaps your address and where the kid went to HS), there is no other indicators of financial means. And even though they do ask what your parents do for a living and where they went to school, there wasn’t one choice that would give a hint or was even close to what my husband does (heck, I can barely understand it). </p>
<p>But I will say this about applying for financial aid - it is not for the faint of heart. State schools only require the FAFSA which is invasive enough, but private schools (i.e., need-blind schools) require a much more thorough accounting. While I don’t have a clue for how it works for internationals (and that’s an entirely different conversation), I do know they want to know about cars, vacations (which I am like… I WISH I could take vacations), 401K’s, property, and if you own your own business, it’s even more so. So… no, you don’t put all your info out there just for the fun of it to see if you can get a dollar. It just wouldn’t be worth the effort of pulling all the information together.</p>
<p>
</p>
<p>Absofreakinglutely !!!</p>
<p>While endowment draws will help cover FA at some schools, there is indeed cost shifting going on with full pay families having part of what they pay going to fund FA for someone else. Yes, there are a handful of schools where the endowments may be large enough for this not to be the case - but at the vast vast vast majority of school sit is indeed fact</p>
<p>At private schools, the COA is only partially covered by the tuition (or comprehensive) fees. That is, Williams costs slightly less than $50k this past year. The actual “cost” to educate each Eph was in excess of $80k, with the $30k gap covered by endowment and annual gifts. That is, even full pays at these schools are paying the full cost. Full pays are only paying a greater percentage of the full cost than FA students. Both are being subsidized at private, elite institutions.</p>
<p>As for need-blind? One has to wonder how those that still claim to be need blind for internationals (amherst and williams) can make that claim? A great thing to do, but one has to wonder what need blind means in this context. With more than 1000 international applications to those two LACs, how is it that only 6% of the student body is international, and that percentage has not changed much over time. Remarkable applicants from China alone could provide 6% of Williams’ entering class, so it is strange how that number has not changed over time, and simply underscores all the suspicions raised now about what it means to be “need blind.”</p>
<p>
</p>
<p>I agree with what you’re saying, but how do you know this?</p>
<p>Reply to #8</p>
<p>When we were at the “Junior Day” (they called it something else) at Univ of Richmond about a year ago, they were fairly clear that their “need blind” policy is more “need aware” during the last couple of weeks of the process. There’s only so much money left at that point. This was said to encourage folks to get their financial aid paperwork in early.</p>
<p>And maybe I’m off base here, but I feel like sometimes kids and parents interpret “need blind” to mean if I’m accepted my need will be met. The term “need blind” simply means that at the point of reading applications need is not considered but there are a million indicators on an application that can tell a school in a rough sort where a student might fall on the contiuum of family wealth. Can’t be that difficult to do a rough sort and end up with a pile that approximates on some level the composition of the class both in terms of interests, skills and financials. Sure there will be an outlier or two, but those aren’t going to bust a budget and then you have the admit-deny factor for the errors. Bottom line though is “need-blind” does not mean “meets need.” As far as Pell recipients for all practical purposes those are full need kids. The Pell monies might be federal money but a full Pell grant doesn’t come close to covering the costs of these institutions.</p>
<p>Pell Grants are the first part of a student’s financial aid package when s/he qualifies. Since the amount is so small, it requires a huge investment on the part of the school to take one.</p>
<p>Williams and other prestige LACs argue that they provide a HUGE subsidy to every student from the endowment, and that no student pays near the cost of attendance. In other words, my donations subsidize the millionaires’ kids (which I am happy to do). But the millionaires’ kids’ tuition payments don’t subsidize poorer students in the least.</p>
<p>In other words, all students received huge financial aid. For the millionaires’ kids, it just isn’t “need-based”, but noblesse oblige.</p>
<p>Most prestige schools (with a few notable exceptions - Princeton being one) are far less socio-economically diverse than they were 25 years ago. Not only do they have lower percentages of Pell Grant students, but the income necessary to be a full-pay student is well higher than it used to be (meaning that if the percentage of those receiving need-based aid remains stable, the student body has become far wealthier).</p>
<p>The problem with using Pell Grants as the sole determining measure of socio-ec diversity is that the Pell Grant rules are arbitrary and, being defined by Congress, unlikely to track the real world in any precise meaningful way.</p>
<p>An example: A family earning $40,000 a year in 1970 was solidly middle class and able to afford Williams without aid. Today, thanks to inflation and two-earner families, $40,000 would be in the bottom quartile of Williams students, and probably qualifying for a Pell Grant.</p>
<p>So, if we just throw up our hands and say, “OMG, Williams has a much lower percentage of families earning under $40,000 than they did forty years ago” that really isn’t telling us anything about socio-economic diversity at Williams.</p>
<p>To make any valid conclusion, we would have to measure against some benchmark index that accurately tracks real socio-economic position over time. There may be such measures (although even something like median family income may be problematic). I am fairly certain that the Pell Grant thresholds are not terribly accurate as a measure. I mean, is a college with 100 families earning $39,500 really any more diverse than one with 100 families earning $40,500? No. The challenge is that the distributions of incomes in the US have changed so radically that it is almost impossible to compare. I don’t know what “middle class” means today, really.</p>
<p>It’s all in the distribution of incomes and no single measure is going to really give us that information. The ideal would be a line graph of all family incomes at a college, allowing us to see peaks and valleys at various income levels. Plot several of those, from peer colleges on the same graph and we could start to see meaningful differences, if any.</p>
<p>BTW, I don’t argue with mini’s assertion that elite colleges are less socio-economically diverse today than they were forty years ago. I have tried and never been able to prove him wrong. On the other hand, I’m not sure that is fair to the colleges. There is no question – it is unassailable – that elite colleges are vasty more diverse ethnically and radically different in the look and feel of the students, faculty, and (in some cases) administration. The fact that African American, Latino/a, and Asian Amerian students are now solidly “middle class” (and really spanning the entire range of economic classes) is hardly an indictment of elite college admissions practices.</p>
<p>I link to this article whenever I see this topic come up: </p>
<p>[The</a> Best Class Money Can Buy - The Atlantic (November 2005)](<a href=“http://www.theatlantic.com/doc/200511/financial-aid-leveraging]The”>The Best Class Money Can Buy - The Atlantic)</p>
<p>The article is from 2005 , but nevertheless gives a good idea of how the schools leverage financial aid, overlay zip codes, target and recruit from feeder schools, disperse merit-aid and practice admit-deny strategies. Some of these factors are more or less relevant depending on the school. For example, some of the most selective schools don’t give any merit aid and do meet full need (fewer in this category than there used to be, unfortunately). I liked the discussion of “unilateral disarmament” - shows how incredibly competitive these schools are with one another.</p>
<p>I would hardly indict private colleges for their admissions policies - they are selling a product, and it is terrific that they make it affordable for some folks who might otherwise not have access to it (and recognizing that in doing so, adding value for all customers.) It is the need-blind myth that needs puncturing.</p>
<p>ALL “need-blind” colleges give “merit aid” - it is called admission. In the case of Swarthmore, every millionaire’s kid receives a $220,000 scholarship over four years (or so Swarthmore itself claims.) The poor kids’ scholarship is larger of course, but not by any order of magnitude. The big difference is that the scholarship for the rich family’s kid is neither neither “need-blind” nor even based on need.</p>
<p>Yes, I remember hearing the “no one pays the full cost of attendance” thing when I was in college. My father didn’t believe it then, either. </p>
<p>I don’t know whether I do or I don’t.</p>
<p>In real dollars, Swarthmore provides far more in subsidies for the rich kids (who may not even need it) than they do in extra subsidies for the poorer ones.</p>
<p>The admissions director at Amherst was quoted in an article as saying something to the effect of “Need-blind doesn’t mean we’re actually blind, but is does mean that being disadvantaged will not disadvantage a student in admissions.” He also said they do not discuss applicants with the financial aid office prior to admissions decisions.</p>
<p>I’m sure it’s true you get a general read on the relative wealth (or lack thereof) based on other details of the application without having to ring up the financial aid office. Folks trying to determine just how blind is blind or whether schools use that as a cheap marketing trick or whether it’s to show their willingness to accept high-need students, or whatever… I mean, there’s no way to know unless you work there. I assume that schools that adopt this policy basically have good (or at least neutral) intentions toward higher-need applicants.</p>
<p>Of course you can know. A reporter actually sat in on the process at Williams, and even published it in the school’s alumni magazine (with their blessing), showing exactly how they were not need-blind, and how they literally counted the “socio-ec” students accepted as they went along.</p>
<p>(As noted, I think their intentions were not “basically” good or bad. They just were what they were.)</p>
<p>I don’t feel like I understand it, even noting what the reporter witnessed at Williams. Schools vary, policies vary, years vary… heck, even reporters vary.</p>
<p>But whatever works for you.</p>
<p>I think schools also want to spend their money their own way. I think my upper-middle class impoverished kid (not joking – H lost $300,000 and bankrupted the family after kids had basically upper middle-class life in fairly elite neighborhood, public school) was more attractive to Williams than to Amherst. I think Amherst wanted kids lower on the socio-economic scale to spend its money on. Can’t fault them for that, but I am grateful that someone wanted to spend money I my kid. I gave the money I saved for him to save his dad’s mental health. I think it was a wise choice. I thought a destroyed father was worse than not having a fancy education. We were lucky both were possible.</p>
<p>Ditto Barnard with D. Smith wait listed D; all women’s colleges all accepted her. Couldn’t help thinking that maybe Smith didn’t want to spend its money on D. Again, don’t fault them for that. Their dollar, their decision.</p>
<p>However, I do think one can get some idea of the kinds of decisions the admissions office makes by really scrutinizing the numbers and policies.</p>
<p>I think the schools made a good investment in my kids, too. D, after spending a year GA, is going back to NYC for law school with the goal of working in NYC for the rest of her career in prison reform and for the Innocence Project. She is interning at the GA Capital Defenders (anti-death penalty group) and working as a nanny to fund her internship.</p>
<p>So, she is reflecting Barnard’s generosity back to NY. S wants to make Latin available to anyone willing to learn it. Don’t know if Williams is excited by this, but its Classics Department is.</p>
<p>So, I agree with mini. Schools are not need-blind and they do cherry pick, but that doesn’t mean needing aid is a detriment, as 'rentof2 has stated.</p>
<p>Nice to see that this discussion has continued as I’ve been off working and doing other things. It seems like, so far, the consensus is that need blind is probably a little more of a shades of gray thing in practice; schools can claim to be need blind to an extent, but do subtle things to influence the selection process.</p>
<p>Now, it will be interesting to see how things turn out the next year or so as more and more colleges have to deal with their own budget struggles.</p>
<p>Does anyone have figures on what it actually costs a private school, say one with a 50 grand “list price”. I also wonder if schools have researched how elastic the supply/demand situation is for a tier I/II school. If one of the cc Top universities or cc Top LACs bumped their price from 50s to 60s, but kept EFC for everyone with FA the same, how much of a hit will they have in their full-pay population?</p>
<p>
</p>
<p>That information is readily available from the colleges’ annual financial reports. Gross sticker price minus fiancial aid discounts gives you net student revenues. Total spending is provided. Both of those can be easily converted to per student numbers for comparison between schools. </p>
<p>It’s cloudy for research universities because they have so many different business units that are unrelated to undergrad education: grad schools, law schools, government research contracts, even chains of hospitals and physicians practices in some cases. For liberal arts colleges, however, it’s pretty cut and dried.</p>
<p>The very top LACs have been spending between $60,000 and $85,000 per year per student (not including financial aid). Operating budget, ongoing maintenance, debt service. They have been getting between $25,000 and $35,000 in net per student revenue (i.e. the real average price they are charging).</p>
<p>What you describe as a pricing strategy is exactly what has been driving the sticker price increases. They have been intentionally raising sticker prices to charge closer to what the market will bear for wealthy customers and then increasing aid to fill the seats at variable prices below that – just like airlines price their flights. The Robin Hood pricing structure is a conscious decision. Occasionally a board member will even talk about it.</p>