Agree. For many. But the premise of this thread- I think- was the “woe is me, we make too much money for financial aid but can’t afford to cash flow four years at $400K”. What is your solution to that– increase aid eligibility to families making half a million dollars a year?
That’s not what I said. I said the idea that these folks are “taxpayers” is disingenuous when the reality is they contribute such a tiny amount, it’s basically immaterial and it’s a big financial net negative.
I never said the state didnt have a core responsibility in educating kids.
Where did I say that?
Can we also agree that even public universities rely on federal funding that relies almost exclusively on upper income taxpayers?
Define Upper Income before I sign on. There are lots of “upper incomes” who pay virtually no taxes and I’m not just talking about the Hedge Fund crowd. Upper income wage earners who get W2’s (like school teachers and cops) are paying taxes. Upper income wage earners who invest in real estate and the like– there are entire industries devoted to making sure that they pay the bare minimum (remember Warren Buffet’s disgust at learning that billionaires pay less federal tax than his administrative assistant?) AND can pass it on to their kids by avoiding the estate tax.
I’m not sold on the notion that since the “upper incomes” are paying for higher ed they should get a finger on the scale. That finger is already a massive fist.
Where did I say they should get a finger on the scale? No one is saying that.
This is about affordability not whether they should get an advantage in the admissions process.
And the reality is that not every family who dont get aid has the money to pay for these elite schools and its not because they took fancy vacations. $800k after tax (specifically for an undergraduate education) is a ton of money to save, even for those who make a lot and try to save as much as they can.
Finger on the financial scale. The argument appears to be that if upper income families can’t afford the 400K pricetag, there should be some mechanism for making them affordable to these families. That’s the finger on the scale. Subsidizing upper income families for the college of their choice. I’m trying to identify what solutions y’all are proposing here. There are plenty of colleges that don’t cost 400K– so having “options” is already happening. The beef is that not everyone can afford Stanford, right???
The issue for me is not class warfare and whether low income families deserve to get into these schools. They obviously do.
The issue is do these schools really need to charge full pay families $100k per year for those who cant get any aid?
What’s the elite school inflation rate? 7% per year?
I can’t read the article well due to the paywall, but as others have pointed out, focusing on the sticker price has little meaning at colleges that offer the equivalent of ~$0 cost to parents after FA, for parents making near the US median income; and where most students do not pay sticker price. The quote focuses on Stanford and Berkeley, so I’ll compare NPC totals for these 2 colleges. I am assuming CA resident, lives on campus, no siblings in college. For all but the wealthy and unique financial situations, Stanford is typically lower cost to parents in this example – the opposite conclusion of the article.
- $100k Income: Stanford = $1k cost to parents, Berkeley = $17k cost to parents
- $150k Income: Stanford = $22k cost to parents, Berkeley = $36k cost to parents
- $200k Income: Stanford = $34k cost to parents, Berkeley = $52k (sticker)
- $250k Income: Stanford = $45k cost to parents, Berkeley = $52k (sticker)
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Does this include the caveat of “typical assets”. What if you have $400k in lifetime savings (which is not wealthy).
Obviously not, but the ‘elite schools’ as you called them are charging what the market can bear.
Like I said above, there is no reason a typical full pay family has to play in the hunger games and chase need-based-only prestigious college admission.
It will be interesting to see if list price growth slows with the new cap on parent plus loans.
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There’s also no reason any student regardless of income need to play in the hunger games and chase prestigious college admissions.
I find this argument to be specious.
You’re literally singling out one specific demographic group when the same argument could apply to anyone.
I didn’t say they did.
But, the reality is for most low income students the only way they can attend a 4 year residential college is to gain admission to one that meets full need. Full pay students have MANY more options.
For the record I do think that attending community college is a fine option for many low income students. Not all of course. Some don’t live near a CC, some don’t have a safe home to live in while they go to CC, etc.
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Yes, that was the “typical” part in my example – low savings. Parents and students are expected to contribute a portion of non-retirement savings/investments (sometimes retirement as well) at Stanford, Berkeley, and other colleges. The student portion is often an especially high % of assets. $400k in savings wouldn’t change the conclusion, but cost to parents would be higher than listed.
How many schools offer full need? Is it only T20 schools?
Not sure how many meet-full-need-for-all schools there are, maybe 60-80? Whatever the number, these schools are such a small proportion of the 4 year US college universe (and have relatively small undergrad populations) that I would call them all ‘elite.’ Many have single digit acceptance rates, and the vast majority would be under 30% acceptance rate.
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I have been struggling with how I feel about this.
We were one of the “donut hole” families that based on the way that universities compute need just could not afford to attend the highest ranked private universities in the US. In our case this might be partly related to being older parents and having a health-induced retirement in the middle of the process. This was in spite of my wife and I both being alumni from some of the schools that at this point we could not afford.
Instead our kids got their bachelor’s degrees at very good universities that we could afford. I do not think that there was any harm here to us. Our kids got a great education at a school that was a good fit for them. Both went on to highly ranked graduate programs, and way more importantly to graduate programs that were a good fit for them. One daughter is currently getting a PhD at a university that we could never have afforded for a bachelor’s degree. I think is has all worked out very well.
Is there a problem here at all?
At least in my mind I am not sure that there is a problem for the students as long as at least some very good affordable options are available.
I however know a lot of families with academically very strong children who are also in the donut hole. I am not convinced that it is to Stanford’s or MIT’s benefit to exclude these kids, particularly when these schools have such enormous endowments. However, THIS IS THEIR CHOICE. These are private schools. If they want to exclude a huge number of donut hole kids they have right to do this. They still seem to find plenty of very strong students to educate.
And we have the right to keep this in mind when we get our annual requests for donations from MIT, Stanford, and Columbia.
To me something does not feel right here, but this does not make it to the top of my list of things to worry about.
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No - that’s not my point at all. My complaint is the cost of college, for the many families who don’t qualify for aid.
This isn’t just an upper-middle-class issue, either. In many places, even families making around $100k (especially with two kids in college) don’t qualify for meaningful aid. And while I don’t think everyone needs to be able to afford Stanford, I do think a qualified student should be able to afford their state flagship. In a lot of states, families in the $100–150k range simply can’t.
This isn’t personal for me; we were fortunate enough to be able to pay full freight anywhere, and we did. But plenty of families can’t.
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True. But as you stated, it’s what the market will bear. And the reality is a school, ie Case Western gives scholarships to 85-88% of their admitted students so no one really expects to pay $100k.
Therefore, what we’re really talking about are only a handful of schools that can charge $100k. Nobody “has” to apply to Stanford because there may be another 50 that offer full aid. Nobody has to play the Hunger Games sweepstakes, including low income families so not sure why only full pay families have to look for other options.
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This is a great question- but let’s unpack it.
Where to cut, where to cut….the things I think are expensive and dumb are the “raison d’etre” for someone else. And vice versa. I’d love to take a whack at a college budget. I don’t know why the athletic facilities have to rival the world’s finest spas, gyms, training centers, etc. I swam regularly in college in an ancient pool which handed out threadbare towels and somehow a lap is a lap is a lap. I know that’s heresy now. Colleges that do not have world class facilities (not just for the athletes- but for everyone) are described as “what a dump” on CC, Reddit, etc. And it’s not just the capital cost of building- it’s the staff, the “assistant to the assistant” for the football team, the trainers who are busy taking care of a gymnasts ankle injury. Why does everyone else have to pay for the gymnasts ankle?
Why does every college need an entire Risk Management team? Cut, cut, cut. But I’m rational enough to do the math- it’s cheaper to have folks on staff every time a drunk freshman falls off a roof (which had signs posted EVERYWHERE that access to the roof is prohibited) rather than having outside counsel deal with the lawsuits and the aftermath. Why does every college need an entire Dietary team? A kid is allergic to nuts- well, avoid the nuts. Or live at home and commute so you can manage your food allergies in your own kitchen. Why does every college need a tutoring center? Kid is failing Organic Chemistry- well, maybe you should switch majors to philosophy.
Etc. We could all achieve a 20% reduction in the annual budget all by ourselves. But my pet peeve is your absolute must have. That’s the way life is.
So absent meaningful cuts– how else are you going to achieve your “full pay families don’t get charged 100K” objective? Push the endowment managers to ever riskier/higher payoff investment? That seems shortsighted. Cut faculty salaries across the board? That seems like a bad idea– except for the faculty in the departments we don’t like. You should cut their salaries AND get rid of them.
Stuff should cost less. All stuff. But getting there is a lot harder than it looks.
And don’t forget that the colleges that have RAISED prices (beyond inflation) are the ones who have benefited from the jump in perception, application numbers, “exclusivity”, etc. I remember when Northeastern was the blue collar budget option for Boston kids who couldn’t afford BU and didn’t want to go across the state to U Mass. Northeastern figured out that being a “good value” college wasn’t positioning them for where they wanted to be. Ditto for GW in DC (and DC doesn’t even have a flagship U).
High prices are a signal for many families. Whether or not they can afford those high prices….
Isn’t the answer to this question, because those full pay families can’t afford (or don’t want to) what the private institution is asking them to pay? The low income family can typically afford what Stanford is asking them to pay (or at least afford it more than what virtually any other 4 year college is offering them). The high wealth family, can afford what Stanford is asking them to pay. So, it is a good option for those families but not the full pay ones you appear to be talking about.
Consistent with Data10’s earlier point. I knew a working class family whose kid got into Stanford and Berkeley. They could not afford what Berkeley was asking them to pay, but could afford the lower cost that Stanford was asking from them. The kid went to Stanford because that was the option that could work for them.
These schools would need huge cuts to drop their list price. As we know, at least for some schools that have worked out the numbers, it costs them much more than the tuition list price to deliver said education to a student. Said differently, even full pay students are being subsidized by many meet full need schools.
I don’t know of more recent data, but the Bowdoin Orient looked at this in 2019 for the NESCAC schools. They simply took total Operating expenses for the college and divided by the number of undergrads.