USC meeting your full financial need- a lie?

Colleges and Universities A-Z University of Southern California
21

@blueskies2day - yes, no bitterness here either. Just calling it like I see it. We are considering acceptances from USC, NYU, UMich (OOS), Northwestern, and a host of others right now for my 2015. From past experience, we knew what we were getting into so no surprises here. All very, very fine schools and the educations will be superb. Despite some cheaper instate acceptances (Berkeley, UCLA), I suspect 2015 will land at one of those other schools… Perhaps even USC, which is a great school! In no way am I bitter or angry at USC - this isn’t about “me.”

It’s the misleading marketing that is so offensive to me. Of these, USC is among the worst because they really do disseminate the false notion that their aid is superior when it is not. It is heartbreaking to watch kids’ dreams fail just because these types of schools claim that all of the need will be met, when they know full well that for many families, there will be large chunks of real need met only by loans.

USC is very good at marketing the Trojan Family, and no matter how many times I have warned people to get ready for a big bill, they just don’t believe it until they see it. They say they ran the NPC, etc., but those of us who have studied these things for a long time know better. This is why I am actually a bigger fan of the FA at NYU and UMich (OOS). They are very upfront and honest about not meeting need, and therefore they are not enticing unsuspecting, hopeful newbies into falling in love and applying. If it hurts their acceptance rates, so be it (although, I think they do not suffer from a lack of applications at all, so the honesty can pay off too!)

22

I don’t see that USC says that they will meet need without loans and work-study.

In fact, their website is very clear:

And they even have a nice big diagram that shows that loans and work study is about 1/3rd of the financial aid.

So the aid includes merit, grants, work and loans. That is NOT the same as saying that they will give you everything you need and you won’t have a big bill that you will use the work-study and loans for your bill.

23

I do agree that using the word “need” is misleading. Clearly each university’s FA office determines some mysterious number they then tell you is your “need.” It’s infuriating, but I think it’s the use of that word. The fact that this figure is not consistent among schools, and no school reveals this exact figure and how they’ll “meet” it until after admissions notices go out makes it all feel hinky, too. But, all of the schools we researched used these same words–“meet” and “need.” I don’t think USC is particularly guilty of the worst offenses. They use the same words, true, but they actually meet (!) more of this figure they call need (!!) with actual grants than loans. Students are only responsible for $5500-$6500 per year in Fed loans (sub and unsub) plus work-study. The rest is all grants. The difficulty, imo, is being told your family is supposed to pay an EFC one finds onerous and ridiculous.

However, we’ve seen USC offering kids their best FA packages, or competitive packages, or lousy packages–but this is usually the interpretation of each family vis a vis their own definition of “need.”. A lot may depend on how FAFSA vs PSS profile parses a family’s assets/income, but again, I don’t see USC as being deceptive or misleading in any way other schools are not. The fact that another schools offers better aid is just the way this illogical system works. ’

Middle class students with high financial need cannot expect to afford to attend a 60K/year university. They can try for merit aid (if it’s high enough), they can apply to lower ranked colleges who lure top students with excellent packages. Or they can go to their state schools. As harsh as this may be (and I hate it–it affected my family for sure), each family has to tell their student the reality. Getting admitted to a school the family cannot afford is a no-go.

I also have no axe to grind or any school to defend out of rah-rah pride. I just see the situation for excellent middle class students who have worked so hard, and earn admissions to dream schools is terribly real-world brutal.

24

Well said, Madbean. The only reason I mentioned USC and not the many other schools that do this is because the OP of this thread brought this up in the context of USC - and it is one of the handful of universities I am very familiar with when it comes to these practices. The EFC itself is the first shock for many middle class families - the insult to the injury is when a college tells the family that they are expected to pay even more than that EFC, in some cases MUCH more, which is in effect a “rejection after acceptance” for so many.

As usual, it’s the kids in the middle that get hit the worst…and that’s the majority of American students. I do not like the trend of many elite/top colleges being accessible only to the very wealthy or the very poor. It closes doors for many hard working middle class students and keeps them, well, in the middle. Of course there are many wonderful colleges out there that are not in the top tiers, and a hardworking student can reach the top of any profession no matter where they start, but there’s no denying that some schools do provide that extra bit of assistance, connections, door-opening “name,” cache, etc. that is simply not accessible to so many SOLELY because they have “need” that the college will not/cannot “meet” after they billed themselves as willing and able to meet all need. The catch is that they get to define need, and many families assume (reasonably, in my opinion) that their EFC is a good estimation of their “need.”

I’m not suggesting that USC is bad or wrong or anything like that. It’s a good school. I just wish that these schools would stop pretending and advertising that they meet “need” because THEY DO NOT in many individual situations. I realize that there’s not enough money to pay everyone’s way, and I do not offer a solution. It’s just, as madbean says, terribly real-world brutal.

25

where does USC say that they meet need?
They explicitly say that loans and work is about 1/3rd of the aid that is provided and state that financial aid and the cost should be a primary consideration, not the only consideration (video).

Well, assuming that your premise is correct and the implication of the middle staying in the middle is bad, what is the alternative? Close those doors to the poor and keep them poor? Prevent rich kids from attending?

26

“Freshmen Financial Aid Applicants 1,913 (63.4%) of freshmen
Found to Have Financial Need 1,147 (60.0%) of applicants
Received Financial Aid 1,147 (100.0%) of applicants with financial need
Need Fully Met 1,093 (95.3%) of aid recipients
Average Percent of Need Met 100%
Average Award $42,272
Need-Based Gift
Received by 972 (84.7%) of aid recipients, average amount $30,707
Need-Based Self-Help
Received by 1,041 (90.8%) of aid recipients, average amount $7,080
Merit-Based Gift
Received by 661 (57.6%) of aid recipients
Merit-Based Gift 617 (20.5%) of freshmen had no financial need and received merit aid, average amount $20,752”

From Common Data for USC.

“Freshmen Financial Aid Applicants 3,195 (62.4%) of freshmen
Found to Have Financial Need 2,506 (78.4%) of applicants
Received Financial Aid 2,426 (96.8%) of applicants with financial need
Need Fully Met 450 (18.5%) of aid recipients
Average Percent of Need Met 73%
Average Award $31,857
Need-Based Gift
Received by 2,270 (93.6%) of aid recipients, average amount $26,202
Need-Based Self-Help
Received by 2,161 (89.1%) of aid recipients, average amount $7,119
Merit-Based Gift
Received by 223 (9.2%) of aid recipients
Merit-Based Gift 136 (2.7%) of freshmen had no financial need and received merit aid, average amount $9,083”

This is solid data for the two schools. Where the issue arises is in the definition of aid Some schools throw in a $2K base, or more that a student even with a zero EFC, no family income or assets have to cough up, and yes, Harvard is one of those schools. Also, how the homes are evaluated and family businesses can vary widely. Also one has to keep in mind that the figures are for those enrolled. How many decline admissions because of insufficient fin aid rather than other reasons like preferring another school is unknown.

One thing about NYU, it has A LOT Of commuters. Even kids from well to do families swallow hard about paying COA there. I know a large number of kids who commute from family home to NYU. For HEOP kids (a program for low income kids in NY), NYU will only give aid up to tuition and fees, not full COA, and there is a question as to how many kids in those aid figures are commuters. People say that they can only make it work by commuting. That is not something that shows up in the Common Data.

I hear bitter complaints about NYU fin aid,merit awards all of the time because I’m in the area. The few kids I know who got fin aid from USC were happy, and my brother who lives on the west coast says, the rep is good for meeting need. But then they have to compete with the much lower cost UCs and other state options that are excellent in terms of providing financial aid, probably the best in the country. That USC can be competitive in getting the students it gets with that state system is a testimony of sorts to its financial aid. My brother, who does keep track of these things says outright, that though no Stanford, it holds it own in getting CA brain power. Sort of like NYU and Columbia is that relationship, but NY does not have the fantastic state choices in term of ratings, rep and recognition that CA has.

One ALWAYS gets complaints about fin aid. The fact of the matter is that few school come close to USC in what it provides, so as poor as it might be perceived, it doesn’t get a whole lot better on the pure fin aid numbers, given there are thousands of colleges in the US.

And I have no interest in the school, nor did any of kids. Not touting it at all. Just looking at it as objectively as I can.

27

I think another huge problem with financial aid is that many parents do not understand how it is calculated at different schools (private vs. public, HYPS vs. other top 25). This is a problem truly created by non transparency by the schools, but there is information out there to gather and make informed guesses (they will never be more than this, however). My kids’ high school has several financial aid nights for parents where they make sure parents and kids have an understanding of what “need” is-- which is VERY different than what we think it means. I wish all high schools across the country did this- there would be less confusion. There are also numerous books out there to lead you through the process-- I know Alamemom mentioned several books on her fab financial aid page on the old USC forum (you can search for this thread I think).

In addition, many parents do not talk to their kids about their financial situation. Kids do not understand that assets are tapped when calculating financial aid and that many parents will not (and probably should NOT in many cases) tap these assets. They don’t understand how their family has an EFC of 30k when their family owns a home (home equity), has several cars, has a 401K, etc… Yes, your parents do not want to sell or tap any of this, but they could. This has always been the case too-- was the same when I went to college in the 80’s.

Yes, it means the middle class can not usually attend a 60K a year college without merit aid or without parents living below their means for many many years and saving. Many private schools do offer merit aid or better financial aid for middle class students. USC is highly ranked enough now to offer much less than other schools who need it to attract students. There are some excellent schools out there that do want USC caliber kids at a discount.

28

@cptofthehouse‌

That was a great post.
Very useful.

@camomof3‌
Yes, it is about information - but I think it is often that the bad information out there seems to travel wider and is louder and listened to more (e.g. people hopeful that the bad info is correct) than there is good information. But there is still good info out there and it takes work.

On bad info, so many bad comparisons (e.g. “my friend got full aid but his parents salary is the same as mine”…okay, but your parents have no debt and a paid off house, and your friend has a big mortgage…)

29

USC is obviously unable to meet everyone’s needs. They do NOT have an endowment big enough to do that. They will meet you according to their extremely unfriendly equation but of course that won’t be good enough for a ton of people. That’s the truth. However if they do not enroll their target of 3,000 or so they will be forced to give more discounts to enroll more student so therefore you should appeal and hope you will be one of the lucky to have your aid increased. I saw quite a few people have their aid increased last year from their original offer.

30

Another way you can tell USC financial aid is not adequate is the yield. USC yield is about 33% give or take 1% from t year to year. That is low for a top 25 school.

31

What should be required is how much of need as defined by FAFSA EFC is met, not need as defined by the college. Bunch of bull that each school gets to define its own need so it’s all over the place and then have comparisions of the % met when the definitions are not the same. If that were there, then we could see definitively what % of need a school meets with need defined the same for everyone.

32

Many assumptions here. Yield is far more complex than that.

Besides, since UCLA has a similar ranking, similar yield and far different cost, there really is no evidence that USC or UCLA yield is driven by aid. CMU and Emory, also are closely ranked and have lower yields, and even UCB with costs similar to UCLA has below a 40% yield.

33

Hi Simbaa, I’m feeling your pain. In fact, I came straight to CC to see if anyone else was in our situation; thank you for posting.
Today, I just un-registered for the Accepted Students Preview Day next week. USC is off the table. My son’s EFC was $17,000. His sister is also in college, so his is half of our family’s total.

USC proclaims they meet 100% need. I know it’s based on their own secret formula, but why is it dramatically different from other schools?

For example, USC brought our cost down to $42,000 with a grant. That is a lot higher than our Fed EFC. BUT, 3 other very selective private schools gave him scholarships plus additional grants to make our cost less than $30,000. Needless to say, he will choose from those 3 schools.
We are still waiting for the award from BC, but I’m guessing it will be like USC.

So, hopefully you applied to some good schools that gave you better packages. Don’t take on crazy debt. It’s not worth it. Schools that don’t offer much merit, and claim to meet 100% need, are very risky to plan to attend. They are certainly not for families that make $100-200,000 a year.

I read a post a few months ago by a dad who had one student at SC, then his younger child also entered college. SC did not increase his grant at all, even though his EFC was cut in half. No way to sign up for that uncertainty for 4 years!

Remember, everything happens for a reason and you will be happy and successful somewhere else!

34

@maggpie

You seem to be conflate the idea of meeting need and giving grants for the full amount of need.
Their website is very clear that 1/3rd of their overall aid is in the form of loans and work study.

35

Great points about schools not reporting the need met for students that did not enroll. Of course, many of those are the ones that could not afford to.

Good idea for schools to report numbers showing an average multiplier for their awards vs Fed EFC.
For example, my USC cost was 2.5x my fed EFC.
My Tulane, SMU and BU cost was 1.5x our fed EFC. Obviously a better value!

When you don’t have any idea of the formula they use, it is hard to decipher where to apply. The schools are not obligated to pay for you, but they are truly deceptive and ambiguous in their presentations.
Lucky, during the entire process, I kept telling my son that he might get into some schools where the financials just were not going to work. But, he was also told that he would get to go to a really good school, just maybe not his first or second choice.

36

i am curious about this as well as the other comments.

It would be useful to see what people got vs. what the NPC estimated.

I ran a simple case of a family of 4, only 1 in college, 53k salary (US median), no assets, no savings, no home equity, no other debts.

NPC came up with $8k in loans/work study, $7k of family contribution and the rest in Gift.

So, even if you run that, you would not conclude they “met full need” since you have to essential contribute $15k in loans, work and cash. Is what people are getting that much different from what the NPC is estimating?

37

@skyoverme - I know of a student with an EFC under $2000, who was awarded a Pell Grant, and who was expected to take on $30,000 in loans/work study/family contribution. No assets other than minimal home equity. Assuming they were being honest with me, and I personally believe they were given the school she ultimately chose and the package she was presumably awarded, that’s not really meeting full need according to my definition. Of course, I don’t make the rules at USC.

38

@cptofthehouse - what a BRILLIANT idea - requiring schools to disclose how the school awards need in relation to FAFSA’s EFC. Does the school expect more than EFC, and on average how much more? EFC + work study + a government student loan? Or MORE than that, and how much more typically?

Since EFC is a standardized (for the most part) calculation for everyone, it would give people a true idea of a school’s generosity in a way that is transparent and more easily compared among various schools. No more slick marketing and creating false impressions!

39

@prospect1‌
Thanks. But that doesn’t really help clarify anything if the 30k was in 29k in loans/work study and $1k in family contribution, or the opposite :wink:

I think the problem is that that phrasing seems to imply to many people here that there are no loans. USC clearly states that financial aid includes loans and work, and in fact show that those categories represent about 1/3rd of the aid provided. So if you have a 2k EFC, and they offer work study of 5k, low interest loans of 25k, 1k of family contribution and the balance as a gift, does that meet full need?

40

@skyoverme, yes, nothing about this process is clear. I wish this thread were not titled “USC” because they are far from the only school with these practices. And there are schools with far, far worse aid. I have no answers, just feel bad for lots of families this time of the year whose kids have worked hard enough to deserve a spot at a fine school. Yes, I said “deserve,” because they worked hard enough to be admitted to schools with outrageously difficult standards. All the research and planning in the world is sometimes not enough to prepare first-time parents of graduating seniors for the bills they are going to face. It’s a shocker to many, even planners and savers.