<p>Government</a> says students don't need $5.3B ? USATODAY.com</p>
<p>What do you think?</p>
<p>Half the cost of attendance of HYPS schools is subsidized by their multi-billion dollar endowments even for full pay students. If they want to give aid to families making $200K a year, that is their prerogative. Just as these aid policies put pressure on lower ranked institutions to give more aid, the top tier students at these institutions are being wooed with merit money elsewhere pressuring HYPS to dig a little deeper to retain the students it wants.</p>
<p>
</p>
<p>A false construct, for the most part. The reason that this would be the case it that they keep raising the top price, and then discounting it for those who can’t afford it. Its hardly truthful to call it “the share of financial aid”. A more accurate statement would be to say the the price paid by full pay parents has risen dramatically over the past 10 years. giving rise to “discounts” for even students just under the top income groups.</p>
<p>
</p>
<p>No kidding. People who are being asked to pull the wagon for everyone have choices. The ones with the highest scores and grades have a lot of really good choices.</p>
<p>The article is a muckraking one that conflates apples and oranges: merit aid and financial aid. The headline implies that affluent families are somehow freeloading on government programs. However, the author fails to distinguish between government programs and merit scholarships that the colleges themselves award as they see fit. The article also does not point out that a great deal of “financial aid” is in the form of loans. The income requirements for Pell grants, etc. are so low that very few students benefit from them.</p>
<p>Everyone’s angry these days about the cost of college and the burden of student loans. This article is red meat to the students and parents drowning in college-related debt. But eliminating private merit aid for high-stats students whose parents happen to be affluent would not help those other students at all.</p>
<p>The distinction between merit aid and need-based aid is often a false one. Many colleges will sweeten the pot for families able to afford full freight by giving them small ($5k a year) “merit” awards. The family can then brag their kid got a merit scholarship, and the college collects $200k rather than $210k (and then they seem raise the tuition, etc. over four years). Same is true with “eliminating loans” and offering "need-based aid to top 10% families. The parents may take out loans anyway, but it might not show up in all the data, and the college can take pride in the higher precentage of students receiving need-based aid, without taking on any more poor ones who would cost them real money. I can make my institution look great by raising tuition by 50%, and then offering 50% more aid to students attending (actually, I come out ahead.)</p>
<p>From the parents’ perspective, merit aid, need-based aid, and the list price should be irrelevant. The only thing that matters (in the money arena) is what you actually pay.</p>
<p>Articles like this tick me off. For example: " Universities say they have been forced to pay out more to people who don’t need it since Harvard, Yale, Stanford and other elite schools started waiving tuition altogether for families that earn as much as $130,000 in a battle for cream-of-the-crop students." Really … FORCED?! I don’t think so. Obviously, these schools WANT these students. If these students have multiple options, and if a particular schools wants them, that school CHOOSES to offer merit aid in order to “get” that student. If it wasn’t important to the school to have that student on its campus, they wouldn’t offer him the money.</p>
<p>And then there is this: “It just doesn’t make any sense,” said Chris Ogren, 20, a junior at New York University, who has come to the financial aid office for the fifth time in two days to sort out a problem with his $45,000 worth of student loans. “You don’t give the bloated guy the cheeseburger when the starving man is starving.” Dude, did you really HAVE to go to NYU?! Was there NO other school in the entire USA that could have done the trick for less money? Yeah, I would like to eat lobster every day … but if I think I am starving because I have to eat a cheeseburger instead of lobster, then I am the idiot.</p>
<p>If schools want to offer THEIR money without regard to ability to pay, that is their business. It certainly happens all the time with sports … why not recruit top students in the same manner? Both bring “prestige” to the school. If someone objects to using “their” tuition money to fund a merit scholarship for someone else, then do the logical thing … attend a different school. </p>
<p>I have been in the trenches of financial aid, and I have seen the masses … poor enough to get lots of aid, poor enough to need it but just “rich” enough to not get much aid, decently well off but unable to get anything but unsub loans, and lucky enough to be able to pay without aid. I still maintain that merit aid is an acceptable tool for schools to use.</p>
<p>Yeah, right…the family in Los Angeles, San Francisco, New York, Boston that earns 100k or 150k does not need any help paying for college. Really? They did not factor in if there is even more than one child in college, 5 children under 18 living at home, age of parents, earnings over the last 20 years, pension vs. savings on their own for retirement. A blanket statement was made about those who earn xyz dollars. Does the income in a low cost of living area go a bit further sometimes than in a high cost of living area?</p>
<br>
<br>
<p>That’s what I thought when I read that.</p>
<br>
<br>
<p>Way more than a bit further.</p>
<p>
</p>
<p>Do the quotes around “merit” imply that these kids somehow do not deserve them? The schools give them to kids they want. It is not “need-based.” So what is it?</p>
<p>There are many families for whom 55K a year is not justifiable for a decent but not stellar place, but if they get, say, 10K a year of merit aid, they may reconsider. It’s like getting four years of college for three years’ payment. It’s a negotiation between a family that could, but does not want to, pay full price for the product on offer. Yes, it’s a “sweetener,” but if the college does not want the kid that badly, then they don’t have to offer the money. I still don’t see how this takes bread out of poorer families’ mouths, as the article implies.</p>
<p>As far as bragging goes: most people I know do not discuss their financial arrangements for college with their friends. I do not know who else is getting what kind of aid, nor do I care. As you say, the only thing that matters is what I’m paying.</p>
<p>Just curious, can anyone here name a school that has increased their merit aid amount distributed faster than tuition has gone up in the past five years (not counting changes at HYPS)? I can name at least one that cut out merit aid altogether. We were going to look at Franklin & Marshall as an academic & financial safety for D2 – D1 attends Dickinson with a nice merit scholarship, and we thought F&M might be a good fit for D2 because she is more sciency. But F&M stopped giving merit scholarships (last year, I think).</p>
<p>Re #5
in our time, full pay family, DS, got a 15% to COA,instigtutional grant to get him, and to compete against. A 40% COA offer
__
DS unsubsidized Staffords interest is subsidized by taxpayers by 3.7x And the PLUS interest is subsidized 4.4x for another 10 yr and 20yrs .</p>
<p>We borrowed about 70% of COA. For those who are good at algebraic word problems, there is still a bunch money to pay off. DS in income and savings is such he can pay off both loans real quickly.</p>
<p>Leave it to USA today to send a write a who has no clue about the difference between financial and merit aid.</p>
<p>Apparently they thought that nobody knew that colleges give out merit aid to the students they really wanted. I wonder what they thought merit aid was for?</p>
<p>“Do the quotes around “merit” imply that these kids somehow do not deserve them? The schools give them to kids they want. It is not “need-based.” So what is it?”</p>
<p>It says that they wanted the $50k a year, and were willing to forgo $5k in order to get it. (It doesn’t say that they were “without merit”.)</p>
<p>And, no, it doesn’t take money out of poorer families’ mouths, at least directly. But it does make a school look like they are more committed to “socio-economic diversity” than they really are.</p>
<p>And, hey, it’s their money (actually “price”, they are not giving anything away), and they can do with it what they please. It is just useful to understand better what they are doing, so one can make good choices.</p>
<p>It’s like Apple discounting a $1,000 MacBook yesterday by $101. Apple is still making a good margin on the product but they’re pulling in a lot more sales by dropping the price for a day. They will also make money on accessories, software and services that aren’t discounted and they may bring more people in to consider Apple’s other products.</p>
<p>Son was at the mall yesterday looking for a new backpack. He said that we went to the Apple Store but couldn’t go in because it was too crowded.</p>
<p>The price tag at most of these schools was 50k in 2008. Now they are all asking for close to 60k in 2012. What percentage of families have had a 20% bump in their income in the last 4 years? </p>
<p>What is it that these schools have done to deserve a $7000 tuition increase in 4 years?</p>
<p>The published cost for most private and out of state colleges is unaffordable to almost all of the population. A good deal of merit aid is awarded based on separate applications, including essays, recommendations, interviews, etc. Anyone who really didn’t need it wouldn’t bother go through the process. Also, EVERYONE qualifies. That includes students with low-income parents.</p>
<p>“The price tag at most of these schools was 50k in 2008. Now they are all asking for close to 60k in 2012. What percentage of families have had a 20% bump in their income in the last 4 years? What is it that these schools have done to deserve a $7000 tuition increase in 4 years?”</p>
<p>That’s simple: supply and demand. Every time the prestige schools at least raise the list price, they attract more applicants. What they have done is “be in continuing demand”.</p>
<p>Currently its more advantageous to borrow college costs from the taxpayers.</p>
<p>
</p>
<p>A prof friend of mine remarked that his not-very-selective school engaged a consultant in the early 2000s, and, for a healthy fee, this was the recommendation (other than the actual percentages), including the reasoning stated above. He said that applicantions did increase, but he wasn’t personally sure it was directly related to the increase in tuition and aid.</p>