<p>One of the things I have been wondering was where boarding schools spend their money, especially those schools with oversized endowment. I initially thought financial aid... and sure, it's one of them, but not one of the things where they spend most. </p>
<p>To illustrate my point, we all know that Exeter has the largest endowment of all boarding schools ($992M) and that 47% of its students are on financial aid. But there are 40 schools (out of 321 total) with smaller endowment but higher percentages of students on financial aid. For example, consider a couple of those schools with strong advocacy on this board: St. Andrew's ($15M endowment; 48% FA) and Emma Willard ($86M; 54%). In fact, when all boarding schools are analyzed as a whole, the correlation coefficient (r) was 0.07 (see below, red-highlighted line), which basically demonstrates no correlations whatsoever between how much money a school has and what % of its students are on aid. So don't get your hope too high up when you apply to financial aid from super-rich schools. </p>
<p>They do spend money on extracurricular activities and sports (r=0.63 and r=0.44, respectively; see below, blue-highlighted lines). It is easy to grasp how much money EC and sports cost. That's one reason why many cash-strapped public schools cut their art and music programs, which don't help improve standardized test scores. The more money a school has, the more of these activities it can offer. And top students are attracted to diverse opportunities in enrichment programs at rich schools, which could help them satisfy their non-academic needs and stand out in college application.</p>
<p>Perhaps this is an oversimplification to some CCer's taste, but it is supported by data:</p>
<p>Category | Correlation Coefficient (r)
Number of extracurriculars | 0.63
Avg. SAT score | 0.57
No. of students | 0.55
Number of AP courses | 0.50
Avg. SSAT percentile | 0.49
Tuition (day) | 0.46
Number of sports | 0.44
Campus size | 0.39
% faculty w/ advanced degree | 0.29
Tuition (boarding) | 0.28
% students of color | 0.25
Avg. class size | 0.11
% students on aid | 0.07
% boarding | 0.04
% international | -0.2
Year founded | -0.2
Acceptance rate | -0.5</p>
<p>Note…I think there’s a typo in your SAS endowment estimate…missing a zero and even then I’m fairly certain $150 million is on the low side of what I believe to be the actual figure. The school just ended a successful $55 million fundraising campaign.</p>
<p>So the beauty of attending one of these mega-endowed schools is that you are getting much more than your money’s worth, because in essence, ALL the students (including the full-pays) are FA recipients.</p>
<p>That’s true of all virtually all private schools, not just the “mega-endowed.” Even at the small private day school that my younger kids go to, tuition (which, while not as expensive as BS is still pretty hefty) doesn’t cover the school’s full operating costs. The school uses a combination of the return on its endowment plus annual giving to meet the difference. Because very few parents give as much in annual giving as the per student shortfall is, pretty much all the kids at that school too are, as you say, FA recipients.<br>
I would also say to SharingGift that while the analysis is interesting, just looking at the overall percentage of kids receiving FA doesn’t necessarily tell you that much. Some schools may be spreading essentially the same amount of money out over more students, others may choose to focus their FA more narrowly and thus have more full FA (or close to full) students. Just to say that one school has 54% of students receiving FA and another school has 47% doesn’t tell you how much each school is actually spending on FA.</p>
<p>Agreed, operating expenses include all expenses associated with running EC and sports programs. Let’s look at Exeter, using the great link that GMTplus7 provided. Exeter says that it covers half of shortfall in the operating expenses from its endowment, and the other half comes from annual giving and other income. Given that most or all schools probably use the same rough rules of thumb on how much of their endowment to spend in any given year, it’s fair to say that Exeter has more money to spend than other schools do to contribute to the school’s annual operating expenses (of course Exeter also has more students too). But the “operating expenses” reflect nothing other than the school’s choices about what to provide – how many teachers and staff, how many different courses, how many sports teams, how many ECs, and how much financial aid. Two schools that had the exact same amount of money to spend might make different choices on how to allocate that money – one could give out a ton of FA but have fewer sports teams or a slightly higher student:teacher ratio, and the other could do the reverse. I just don’t think that the amount of the endowment necessarily tells you much about FA vs. sports vs. ECs, etc., other than when you’re talking about schools that are wildly differently situated.</p>
<p>Just as a matter of interest I did the math on FA for Exeter. There are roughly 1000 students at Exeter, and almost half get FA, and the average award is just shy of $38k. That means that Exeter is handing out a total of about $18.9M in FA each year.</p>
<p>Wow, those numbers are really interesting in comparison to Exeter’s. According to the link posted above, at Exeter net tuition covers only 30% of the operating budget (compared to Choate’s 62%), and Exeter’s endowment draw covers 50% of the operating budget (compared to Choate’s 22%). For both schools, annual giving covers 10% of the operating budget and “other income” is similar (8% for Exeter and 6% for Choate). So Exeter gives out more FA or costs more to run (on a per student basis), or both.</p>
<p>Both Exeter & Choate give out approx $35k/recipient, on average. Their annual FA budgets are $10m and $8m, and percentage of students receiving FA are 45% and 33%, respectively. Endowment/student is $900k vs. $300k.</p>
<p>How do you get a FA budget for Exeter of $10m? It seems a lot higher than that. If the school has roughly 1000 students, 45% FA, and the average award is $37,779 (that’s the figure in the article you linked to), then the total amount of FA is more like $17m.</p>
<p>It turned out, it was not a typo; I was in effect referring to another St. Andrew’s School, the one in RI. (In fact, there are three St. Andrew’s School–in DE, RI and FL, with the one in DE being better known and strongly advocated by SevenDad.) To correct my earlier post, SAS DE has $170M (endowment) and 46% of students on FA; SAS RI has $15M and 54%; and SAS FL $13M and 19%.</p>
<p>I can actually appreciate this criticism. To rephrase in a simplistic way, with the same FA budget, a school can choose to give out either $30,000 per student to 50% of total students, or $15,000 per student for the entire student body. We would need more than % students on aid, such as mean or median grant amount, standard deviation, confidence interval, etc. These numbers are not readily available, since schools don’t publish them:-)</p>
<p>When I casually browsed FA amount for individual schools in the past, I was surprised to sense that there were no significant difference in FA amount between rich, well known schools and poorer, lesser known schools. boardingschoolreview.com do publish average grant amount, so you could calculate total $ figures individual schools spend on FA and how such an amount compared to its endowment size. Previously, I used % of students on aid because those figures could be easily retrieved and I was too lazy to transcribe them one school at a time. I still am not willing to do that, but here’s data for some of the schools:</p>
<p>School | Endowment Size | Enrollment | Percent Students on Financial Aid | Average Financial Aid Grant | Total FA amount | Total FA as % of Endowment
Exeter | $992M | 1085 | 45% | $38430 | $18763447.5 | 2%
Andover | $800M | 1141 | 47% | $38055 | $20407754.85 | 3%
SPS | $433M | 536 | 35% | $44275 | $8305990 | 2%
Deerfield | $398M | 630 | 35% | $39000 | $8599500 | 2%
Hotchkiss | $362M | 594 | 37% | $36960 | $8123068.8 | 2%
Choate | $283M | 864 | 33% | $38000 | $10834560 | 4%</p>
<p>The above schools are inversely sorted according to their endowment size, and the last figure in each line is total FA amount as a % of school endowment. As you can expect, HADES schools are ranked top in endowment size, but they are not necessarily giving more in FA. </p>
<p>In conclusion, this supports my previous conclusion that endowment size had no correlations with FA, even when I just used % of students on aid.</p>
<p>You should factor in the average size of the FA grant. As Soxmom pointed out, % of students on aid isn’t a meaningful comparison without that information. </p>
<p>Endowments often carry restrictions. So, for all I know, some of the schools might have separate funds for taking care of church towers, or mowing the football fields, or procuring fetal pigs for biology courses. The money which is available for FA could be significantly smaller than the size of the endowment.</p>
<p>You would also need to correct somehow for different percentages of day and boarding students. I don’t regard ECs and sports as extras, as it helps to keep kids out of trouble if they’re doing something supervised by an adult. The boarders don’t go home, and everyone sleeps better at night if the teenagers go to bed tired.</p>
<p>The more boarders a school has, the more people they need to supervise the dorms. I don’t think there’s a separate line for that? And new buildings cost less to maintain and run than old buildings.</p>
<p>One thing that I wanted to clarify was that I believed those rich, elite boarding schools were right on the money that they spend a big chunk of their cash reserve/endowment on extracurricular activities and sports. If you think about it, many boarding schools, richer or poorer, do reasonably well in supporting students academically. And as I have elaborated in [url="<a href="http://talk.collegeconfidential.com/prep-school-admissions/1550335-ssat-sat.html"]SSAT-to-SAT[/url">http://talk.collegeconfidential.com/prep-school-admissions/1550335-ssat-sat.html"]SSAT-to-SAT[/url</a>], SAT performance of most students are “largely” determined even before they set their feet on the campus, regardless of the schools they choose. A smart kid with extracurricular/sports talent may look for opportunities for diverse enrichment activities, and rich schools can cater to their palates.</p>
<p>Agree, SharingGift–ultimately it’s the ec’s and sports that distinguish kids from the masses of straight A, 2300 plus SAT crowd. Not to mention that when it comes to boarding school, a kid busy with challenging school-sponsored activities in addition to challenging academics is, more often than not, a kid too tired to get into trouble!</p>